What Is A Mutual Fund Portfolio Analysis?
This way if your fund is not performing as well as other mutual funds in the category you can identify the poor performing fund. It also allows you to switch to a better fund, exit a fund before you lose more money, and in the best case scenario reaffirm that your portfolio is well balanced and will help achieve your financial goals.
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Why Should You Track Your Portfolio’s Performance?
How To Evaluate A Mutual Fund’s Performance?
There are a number of factors that are taken into consideration when your mutual fund portfolio is being analysed. Here are some of the most important things that are done when your mutual fund portfolio is analysed:
Risk-adjusted returns are looked at
Your funds are compared to appropriate benchmarks
Market & economic cycles are taken into account
Multi-year performance of your fund and it’s category is considered
Various ratios are applied to check your portfolio funds
Your fund manager’s track record and movements are taken into account
The quality of the stocks in each of your portfolio funds is checked
The overall AUM and performance of the fund is checked
How Often Should You Evaluate The Fund Performance?
If you have a Wealth Coach, he or she will be perpetually analysing your portfolio. In such a scenario a full-fledged portfolio analysis is required less often and you could even do it once every few years. If you have been investing on your own and intend to continue to do so then it’s a good idea to get a portfolio analysis done at least once a year. This way you will be able to ensure your portfolio is in good shape and you are not losing money while trying to make more.
Which Financial Ratios Are Used For Technical Portfolio Analysis?
There are a lot of financial ratios and measures that financial advisors use to perform an in-depth portfolio analysis. While not all of them are used at the same time, given below are the most popular ones: