Open an Account
Trade Now
  • Markets
  • Products
  • Research
  • Partner with us
  • Blog
  • Refer & Earn
Open an Account
Trade Now
  • Markets
  • Products
  • Research
  • Partner with us
  • Refer & Earn
Home » Blog » Mutual Funds » Equity Mutual Funds: 10 things you can read from an Equity Mutual Fund Factsheet
Religare Broking by Religare Broking
September 19, 2023
in Mutual Funds
0

Equity Mutual Funds: 10 things you can read from an Equity Mutual Fund Factsheet

Equity Mutual Funds: 10 things you can read from an Equity Mutual Fund Factsheet
Sep 19,2023

If you are holding equity mutual funds, you must access the fund fact sheets on a monthly basis. Apart from giving the fund manager’s guidance for the economy and the markets, this monthly fact sheet also provides a glimpse of the latest portfolio of the mutual fund. Here are 10 things you can actually glean by reading the fund portfolio carefully…

1. Compare the portfolio mix with the original stated objective of the fund. If the original objective of the fund was to invest in a diversified portfolio of large cap stocks, then that is what it should be. If your reading of the portfolio reveals that the fund has shifted substantially into mid-caps or into specific sectors, you need to re-think.

2. Is the fund diluting the definition of its objective? This is quite common with many funds. They define the fund objective as an IT fund and you would logically expect it to focus purely on IT stocks. Over a period of time, if IT is underperforming in the market, these funds expand the definition of IT to also include banks and other sectors which leverage on IT. Remember, as an investor, this introduces a different element of risk than what you were originally prepared for.

3. Is the fund sitting on too much cash for too long? This is a common practice when fund managers are ambiguous about the market or markets are appearing stretched. But holding on to cash for too long defeats your entire purpose of creating wealth. You want your fund manager to be prudent with your money, not overly conservative.

4. Look at the sector mix of the portfolio. If your equity fund portfolio is largely in tune with the weightage of sectors in the Nifty or Sensex, then you will earn approximately Nifty returns. Then you will be better off choosing an index fund as they have much lower costs.

5. Is the fund manager adding risk to the portfolio? This is evident if you compare the Sharpe ratio of the fund over the last few quarters. A rise in risk will typically be indicated by a falling Sharpe ratio. Most funds reveal the fund Sharpe ratio as part of the fund portfolio.

Recommended Read: Benefits of Investing in Mutual Funds over Direct Equities

6. Check out the Beta of the fund portfolio. In a market like India, you surely want a portfolio that has a Beta of greater than 1. A Beta of less than 1 will mean that the prospect of your fund outperforming the index stands reduced.

7. The proof of the pudding lies in the eating. Your fund, at the end of the day, needs to beat the index. Occasional slip-ups are understandable, but if your fund is consistently underperforming the index, then you need to ask some serious questions to your financial advisor.

8. Look for portfolio shifts when ownership changes. Indian mutual funds have been consolidating over the last few years with mergers among funds happening quite frequently. When a merger happens, the new AMC may come with a new set of philosophies and investment strategies. This will be reflected in the portfolio.

9. It is important for one to understand the fund manager of the portfolio through the portfolio mix and its trajectory. Whether your fund manager is aggressive, conservative, mid-cap oriented, large-cap oriented will all be captured by the fund portfolio over a period of time.

10. Last, but not the least, compare with peers. If you are holding on to a diversified equity fund, then look at the portfolios of peer group funds. What are the stocks which peers are adding and what stocks are they exiting? Is your sector mix and sector shift broadly aligned with the peer group? In case of substantial discrepancies, you need to talk to your financial advisor and understand the logic for the same.

Recommended Read: Benefits of Investing in Mutual Funds over Direct Equities

Most mutual fund investors tend to just see the top holdings of the funds they own and leave the rest to the fund. As an investor, it is your right and your obligation to keep yourself well informed about the holding pattern of the fund. It can go a long way in pre-empting wrong decisions. After all, it is your hard earned money.

Previous Post

Benefits of investing in mutual funds over direct equities

Next Post

Debt mutual funds understanding different types of debt mutual funds

Religare Broking

Religare Broking

Religare Broking: Online Trading of Stocks, Commodities and Mutual Funds in India

Next Post
Debt mutual funds understanding different types of debt mutual funds

Debt mutual funds understanding different types of debt mutual funds

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Disclaimer: This blog is written exclusively for educational purpose. Any stock mentions in the blog are examples and not recommendations. Please refer to our research reports or analyst recommendations for stock ideas.

No Result
View All Result

Category

  • Demat Account (13)
  • Mutual Funds (19)
  • Stock market (41)
  • IPO (4)
  • Trading Account (27)
  • Market & Economy Update (7)
Related Blogs
Debt-to-Equity Ratio

Debt-to-Equity Ratio: A Comprehensive Guide

Read More »
Sep 29,2023
10 Most Expensive Stocks in India

10 Most Expensive Stocks in India

Read More »
Sep 29,2023
Understanding Options Trading

Understanding Options Trading: A Comprehensive Guide

Read More »
Sep 29,2023

Latest Blogs

Debt-to-Equity Ratio: A Comprehensive Guide
  • Stock market

Debt-to-Equity Ratio: A Comprehensive Guide

By Religare Broking / September 29, 2023
Undеrstanding divеrsе financial ratios are critical for еducatеd dеcision-making in thе...
Read More
10 Most Expensive Stocks in India
  • Stock market

10 Most Expensive Stocks in India

By Religare Broking / September 29, 2023
Company sharеs, somеtimеs known as stocks, signify ownеrship of a portion...
Read More
Understanding Options Trading: A Comprehensive Guide
  • Trading Account

Understanding Options Trading: A Comprehensive Guide

By Religare Broking / September 29, 2023
Buying options may be a suitable choice if you wish to...
Read More
How to Open PPF Account: A Comprehensive Guide
  • Market & Economy Update

How to Open PPF Account: A Comprehensive Guide

By Religare Broking / September 29, 2023
Opening a Public Provident Fund (PPF) account is a prudent step...
Read More
NRI Investment in Mutual Funds – Process, Do’s & Dont’s
  • Mutual Funds

NRI Investment in Mutual Funds – Process, Do’s & Dont’s

By Religare Broking / September 29, 2023
For non-resident Indians (NRIs) keen to explore the Mutual Fund market,...
Read More
How to Withdraw, Transfer and Close a PPF Account
  • Market & Economy Update

How to Withdraw, Transfer and Close a PPF Account

By Religare Broking / September 29, 2023
Navigating the intricacies of a Public Provident Fund (PPF) ensures you...
Read More
What is Difference between Cash Market vs Future Market
  • Stock market

What is Difference between Cash Market vs Future Market

By Religare Broking / September 29, 2023
When navigating the financial world, the concept of Cash market vs...
Read More
Dеlivеry Trading Explainеd: A Solid Invеstmеnt Stratеgy for Invеstors
  • Stock market

Dеlivеry Trading Explainеd: A Solid Invеstmеnt Stratеgy for Invеstors

By Religare Broking / September 28, 2023
Introduction: Stock markеt trading takеs sеvеral forms, ranging from physical buying...
Read More
Intraday Trading vs. Delivery Trading – How to Choose Wisely
  • Stock market

Intraday Trading vs. Delivery Trading – How to Choose Wisely

By Religare Broking / September 27, 2023
Introduction Whеn it comеs to trading in thе stock markеt, invеstors...
Read More
Unlocking Opportunities: Margin Trading with Religare Broking
  • Trading Account

Unlocking Opportunities: Margin Trading with Religare Broking

By Religare Broking / September 17, 2023
Margin trading is a powerful tool in the world of finance,...
Read More


To remain updated on the latest
market updates
follow us at

  • instagram

Copyright 2010 Religare. Trademarks are the property of their respective owners. All rights reserved. Please note that by submitting your mobile and email on our website, you are authorizing us to Call/SMS/Whtsapp/Email you even though you may be registered under DNC. We shall Call/SMS you for a period of 6 months

Religare Broking Limited (RBL): Registered Office: 2nd Floor, P-14, Religare Broking Limited (CIN: U65999DL2016PLC314319), Registered Office: 2nd Floor, P-14, 45/90, P-Block, Connaught Place, New Delhi 110001. Telephone No. : +91-011-49871213 | Fax: +91-011-49871189. Member Religare Broking Limited (RBL) : SEBI Regn. No. INZ000174330 NSE CM, F&O, CD TM Code: 06537 Clearing Member (F&O) No. M50235; BSE CM, F&O, CD, CO Code: 3004 Clearing No: 3004; MSE CM, F&O, CD, TM Code: 1051| MCX Membership No. 56560 | NCDEX Membership No. 01276 | AMFI ARN No.139809. Depository Participant : Religare Broking Limited (RBL) – NSDL: DP ID: IN 301774 | SEBI Regn. No: IN-DP-385-2018 | CDSL DP ID: 30200 | SEBI Regn. No: IN-DP-385-2018. Research Analyst: Religare Broking Limited (RBL) – SEBI Regn. No: INH100006977 | Registrars to an issue and share Transfer Agents (RTA) - SEBI Regi. No : INR000004361 | Corporate Agent (Composite) - IRDA Regi. No : CA0581 | National Pension System - Point of Presence (NPS-POP) - PFRDA Regi. No : POP01092018.

Disclaimer : Investment in securities market are subject to market risks, read all the related documents carefully before investing. RBL is a distributor of Mutual Funds / IPOs / Insurance / Bonds & NCDs. Equities, Currencies & Depository Services are offered through Religare Broking Ltd. Brokerage will not exceed the SEBI prescribed limit. Securities quoted are exemplary and are not recommendatory. | https://www.religareonline.com/disclaimer


T&C Apply*

Open an Account
Please enter valid name
Please enter valid email
Please enter valid phone
Please enter valid OTP Your One Time Password sent to above number.
Resend OTP
No Result
View All Result
  • Markets
  • Products
  • Research
  • Career
  • Partner with us

© 2021 RELIGARE -Designed By Religare.