The dividend distribution tax associated with debt mutual funds (dividend payout and dividend reinvestment options) has been hiked again in this budget. Last year, the government changed the way in which the DDT was calculated. (read more here). The DDT hike by a huge extent: from 22.073% to 28.325%. This year, they have increased the…

Use this tool to compare the risk-adjusted year-on-year performance of two mutual funds over the last 8 years. This is an alternative to the previously published, fund A vs. fund B mutual fund analyzer, in which the  comparison could be made for investment durations ranging from 1-8 years. This year-on-year analyzer allows you to compare funds…

Thanks to Narendra Bhongale, there is now clarity on when investors can invest online in MF Utility after getting the common account number (CAN) . He was kind enough to attach the response from the MFU team in his comment to yesterday’s post. It is reproduced as is, below. ~~~~~~~~~~~~~~~ Dear Sir, We thank you for…

Here is  a set of illustrations that highlight the benefit of investing in direct mutual funds for your long-term goals. First some good news: MF Utility a portal in which investors can consolidate their holdings in different AMCs and invest in them with a common account number (CAN) will start operating from March.  You can…

MF Utility is a web-based transaction portal through which investors can invest in direct mutual funds offered by 25 (as of now) fund houses. Mr.  V Ramesh, Managing Director and CEO of MF Utility, answers some common questions investors ask about the facility. This is the website of MF Utility: www.mfuindia.com Extract from investor page:…

Use this rolling standard deviation calculator to evaluate  the volatility in returns of  a mutual fund.   This is an idea that struck me during the Chennai investor meet in response to a question. The sheet calculates the rolling return and rolling standard deviation for a specified interval. For equity funds, the rolling standard deviation of…

Use this rolling returns calculator to compare the consistency in performance of one mutual fund with another. When you have shortlisted two funds and are not sure which one to choose, this tool along with the Fund A vs. Fund B Risk and Return Analyzer can be used to choose one fund. For those who…

In this post, let us compare two large cap funds from the  same fund house. One a consistent performer with a terrific track record and the other a young superstar. The results will hopefully show how herd instincts among investors (and perhaps amcs  and therefore(?) intermediaries too?) can obscure good funds from the same fund house….

In the first part on why you should ignore mutual fund star ratings, I had stressed on the importance of focusing on our portfolio health and performance of the fund with its benchmarks. In this post I would like to add a couple more reasons to strengthen the argument. Let us assume that an investor named Tom has chosen…

‘Should I choose only five star rated mutual funds?’, ‘Should I switch funds each time my funds rating is downgraded?’. These are extremely common questions among mutual fund investors.  In this post, let us discuss how star fund ratings are irrelevant to the goal-based investor. Any action, buy, sell, hold, switch etc. should be based on…

It is raining closed-ended mutual fund NFOs. Here is why one should avoid this category of mutual funds. There are many articles that describe the features of closed-ended mutual funds. Therefore, I will not mention them here. Let us focus on the titular suggestion alone. 1) The first and foremost rule of purchasing – be…

This post details a backtesting analysis based on the investment strategy to be adopted by the NFO IDFC Dynamic Equity Fund. It is inspired by a thread in facebook group Asan Ideas for Wealth started by Anup Maheswari. IDFC Dynamic Equity Fund (IDEF) is a quantitative tactical asset allocation fund along the lines of  Franklin’s…

What factors should we consider before choosing a mutual fund or evaluating a mutual that we hold? Should we only look at star ratings? Should we consider only returns? Risk-adjusted returns perhaps? Should we track the actions of the fund manager? Should I understand the kind of stocks that he/she has picked or is likely…

On Aug. 25th 2014, the Economic Times carried an article titled, PPF investment can beat Sensex returns over 20-year period. They showed that between Aug. 1994 to Aug. 2014, Sensex returned an annualized return of 9.15% while the PPF returned 10.46%. Needless to mention this article created a lot of buzz among investors and distributors. Investors panicked and…