Mutual FundsAnd it's really easy to invest in them!
A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt. The combined holdings of the mutual fund are known as its portfolio. Investors buy shares through in mutual funds. Each share represents an investor’s part ownership in the fund and the income it generates.
Who can invest
- Resident Indian Individuals / HUF
- Indian Companies / Partnership Firms
- Trusts/Charitable Institutions
- NRI
Characteristics of a Mutual Fund
- Mutual fund are manage by professional fund managers
- The funds are invested in a portfolio of marketable securities, reflecting the investment objective.
Benefits of Mutual funds
- Portfolio diversification
- Professional management
- Reduction in risk
- Reduction in transaction cost
- Liquidity
- Convenience and flexibility
EQUITY FUNDS
- Mutual fund invest in india’s BSE-500 index.
- Pre-dominantly invest in equity markets
- Diversified portfolio of equity shares
- Select set based on some criterion
DEBT FUNDS
- Predominantly invest in the debt markets
- Diversified debt funds
BALANCED FUNDS
- Majorily invest in Equity & Debt instrument
- Investment in more than one asset class
- Debt and equity in comparable proportions
- Pre-dominantly debt with some exposure to equity & vis-vis
Our Mutual Fund Selection Process
The first step in the research process begins with an initial screen of historical performance. The initial screen is intended to identify both outperformance and consistency of performance, While factoring in risk characteristics. It starts with simple requirements; the portfolio manager Must have at least three (3) years of tenure within the fund’s investment process and his or her Performance must be better than 50% of peers according to Morningstar and/or a customized peer Group over rolling three- and five-year time horizons. Quantitative screens are used to help narrow the universe of funds, focusing only on those that have demonstrated the ability to outperform Within their categories over a full market cycle.
During The Second Step, The Specialist Teams Further Evaluate Performance Using A Scorecard Approach That Assesses:
- The Fund’s Relative Quartile Performance Compared To Its Benchmark And Peers
- Risk-Adjusted Returns To Measure How Much Return Is Generated For Each Unit Of Risk
- Upside And Downside Capture As It Relates To Index Benchmark Performance
And 2nd Part Is While A Variety Of Metrics Are Considered, The Team Has Found That Standard Deviation, Sharpe Ratio, Sortino And Beta Are Particularly Useful Because They Are Easily Comparable Across Peer Groups.
In The Portfolio Manager Review Our Team Seeks To Determine The Soundness Of The Management Team And Process Through A Variety Of Questions Such As, But Not Limited To:
- Does The Portfolio Management Team Adhere To A Well-Defined Investment Philosophy And Process?
- What Is The Team’s Sell Discipline?
- How Do The Portfolio Holdings Reflect The Team’s Philosophy?
- What Attributes Does A Particular Security Have That Makes It Either Attractive Or Unattractive
Given The Team’s Philosophy?
- Has The Philosophy Changed Over Time, And If So, How?
At This Point, Our Team Combine The Initial, Secondary And Management Interview Research To Construct A Detailed Picture Of The Fund And Its Management Team. All Of The Available Information On Performance, Investment Style, Portfolio Management Team Depth And Consistency Is Considered In Selecting The Funds That Are Believed To Have The Highest Potential To Continue To Deliver Above-Average Result.
The Fifty Stage Of The Continuous Mutual Fund Research Process Is The Monitoring Of The Manager’s Performance.
The Monitoring Process Includes:
- Speaking With Portfolio Management Teams At Least Twice Per Year
- Assessing Relative And Absolute Performance Using The Scorecard System Described Above
- Conducting Attribution Analyses Across Industry Sectors And At The Individual Security Level
- Performing “Style” Analyses To Gauge Whether A Fund Has Moved Substantially From Its Original Or Stated Investment Focus
- Identifying Any Management Changes To Determine If The Focus Has Changed Significantly From The Original Recommendation To The Investment Committee
- One To One Client Meeting Periodically For X-Ray Report Of Portfolio.
Ultimately, The Team Strives To Construct A Core List Of Mutual Funds That May Be Used To Fill Most Asset Allocation Needs. The Team Focuses On Consistent Performance Over A Full Market Cycle Rather Than Current Hot Funds Or Trends And Does Not Attempt To Predict Short-Term Performance. Recommended Funds Are Chosen For The Long Term, With An Understanding That Their Particular Asset Classes Or Client’s Goals And Investment Styles May Not Be In Favor In All Markets.
Investment & Portfolio funds selection & Analysis
By MORNINGSTAR Software
Portfolio X-Ray Will Show The Details Of The Portfolio Allocation Along With Sector Bifurcation. It Will Also Display The Morningstar Equity & Fixed Income Style Box & Top Ten Holdings Of The Portfolio.
Portfolio Snapshot Will Display Portfolio Activity Graph Along With Trailing Returns For 1,3,5, 10 Year Returns & Also The Best & The Worse Time Periods Of The Portfolio Performance.
Risk Reward Scatterplot Display The Risk And Reward Performance Which The Portfolio Takes And Also Shows Whether The Schemes In The Portfolio Lies On The Low-Risk High Reward Or High Risk High Reward Or Low Risk Low Reward Or High Risk Low Reward Accordingly.
Stock Intersection Shows The Details Of The Underlying Holdings In The Portfolio.
Common Holdings Report Will Display The % Of Securities Held With Their Respective Holding Proportion Across Portfolio. This Helps Us To Know Which Schemes Have Underlying Stocks Or Holdings Which Are Similar Or Not.
