Who Is Cube’s MF Advisor?

Wealthfirst is Cube’s advisor partner in mutual funds. With a team of highly experienced finance gurus and young and spirited investment experts, it is a leading Wealth Management company in India. All the mutual funds are handpicked and recommended by WealthFirst. Additionally, Wealth First has a history of outperforming the market by about 50%.

How Is WealthFirst Different From Others?

Let’s understand this by looking at a 2020 case study where our advisors recommended exiting a fund and recommending a new fund that was expected to perform better than the deprecated one.

As you can see in the graph, our advisors recommended that we depreciate the fund (marked in red). They also forecasted when the value and performance of the depreciating fund would decline. (marked in yellow). 

Wealth First came to this conclusion by looking at the quarterly performance of the fund rather than the annual performance and considering other factors as well. It's not surprising that expectation and reality converged.

It also suggested a new mutual fund (marked in blue) that performed significantly better than the deprecated fund when that fund was being urged to be discontinued. The difference was a staggering 17%, which is absolutely astounding.

Why Is Choosing The Right Financial Advisor Important?

To plan investments, prepare for retirement, handle emergency finances, and do much more, you will need a financial advisor. Financial consultants support you in achieving your financial objectives and building lasting wealth.

To find the right financial advisor, you will have to invest a lot of time. You might ask your friends and family, surf online, or go from offices to places to find the right one for you. Cube Wealth is a one stop shop for all your financial needs. You can get the Financial Freedom App here. Android / IOS

You don't want to choose an advisor who is more committed to their firm and the goal of profit than to genuinely creating wealth for you. Neither do you want to choose an advisor who makes the wrong forecast and  picks the wrong fund for your investments.

How Cube’s Advisor, Wealth First, Picks A Mutual Fund

While picking a fund, WealthFirst follows a systematic approach.

1. Consistency 

 The primary distinction between Wealth First and the other financial consultants is in evaluating quarterly performance as compared to annualized performance.

2. Fund Manager

The second step that distinguishes our adviser is that they take into account not only the data but also the fund manager, who is responsible for overseeing all day-to-day trading for their clients.

A fund manager plays a crucial role in picking a mutual fund. He or she is like the face of the fund. When there is a frequent change in the fund manager for a fund, our advisors often recommend that investors stay away from that fund.

Also, when there is a "key man," or a person who has been with a fund for a long time, and decides to part ways, our advisors often ask our investors to wait and watch or exit the fund.

3. Fund House

Analyzing the background of the fund house based on factors such as size (total AUM), history, stability in fund management, and the aggregate performance of its funds to evaluate its track record.

4. AUM Size

AUM is also a crucial factor to consider if you are planning to invest in debt funds. A debt fund with more capital can spread the fixed fund expenses across a larger number of investors. This can reduce the expense ratio per person and hence increase fund returns.

The impact of a large AUM affects mid- and small-cap companies. The main reason behind this is that small-cap companies invest in high-growth potential companies, which are redundant. Buying and selling shares in these small yet high-growth companies becomes a challenge, and as such, high volumes may not be available in the market at all times.

Small-cap funds have a tendency to restrict cash inflows beyond a certain level. Such a situation arises when the assets under management for the given mutual fund rise beyond a certain mark.

5. Risk

When all the measures have been taken, our consultants suggest a fund with a low risk-to-reward ratio. (The Sharpe Ratio)

For example, our advisors had recommended an exit from Franklin debt funds in January 2020, before the COVID-19 pandemic. At that time, Franklin debt funds were performing above the category average. However, our advisors were not comfortable with the risk taken to deliver this return and recommended an exit, three months before Franklin blocked exits and they were downgraded.

Trial-and-error procedures are never better or faster than expertise, experience, and effective means. In today’s busy world, we do not have so much time to dedicate to our wealth. Let's work together to simplify your life and create wealth.