Seasoned investors know the importance of getting a portfolio analysis done from time to time & for many of them it is part of their basic financial hygiene but… why? Well, here’s the problem. Everyone wants to invest in quality assets but not everyone knows how to pick them. In fact, you should never pick Mfs on your own.
If you have already invested on your own, chances are you have a few bad apples in your portfolio. This is why it is important to get expert help in analysing your mutual fund portfolio from time to time. A lot of people have the misconception that once you invest in mutual funds your job is done. Simply investing in a set of mutual funds consistently doesn’t guarantee results in the long term.
You have to pick the right funds and a fund that is right today may not be right for you next year. A fund can change its objective, the fund manager may leave or maybe the market itself is facing volatility like it is right now. That’s why you need to get a Mutual Fund Portfolio Analysis.
But before we talk about the solution, let’s take a quick look at what getting a mutual portfolio analysis even means.
What we call Mutual Fund Portfolio Analysis is the process of assessing all your mutual fund investments. This helps ascertain if the mutual funds you have in your portfolio are good, bad, or in some cases just terrible.
This way if a fund you’ve invested in is not performing as well as others in the category you can take action. You can exit a fund before you lose more money, switch to a better fund and in the best case scenario reaffirm that your portfolio is fine & will help achieve your financial goals.
1) Track Your Investments
The solution is simple - Track your investments. If your portfolio is performing the way you expected it to perform – all is well. If not it’s a good time to talk to a Wealth Coach and get an expert’s opinion on what you should do next.
2) Leave The Analysis To The Experts
Number 2, don’t evaluate your own mutual funds. Even if you’re an expert investor it’s difficult to view your own money objectively. It’s essential to get an expert wealth advisor to help you through this.
Many things are done when your mutual fund portfolio is analysed, such as:
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
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
Basically a lot goes into doing this and I don’t know about you but, I like to leave this bit to the professionals. Of course, you don’t have to pay someone to do this.
That’s because you can get your mutual fund portfolio analysed for free. Cube Wealth is offering this instant portfolio analysis service for free.
Watch our video on Portfolio Performance Analysis
Rishabh P Nair
Rishabh P Nair is the Head Of Brand Content at Cube Wealth, the Financial Freedom App with a smart Perfect Portfolio Planner. Rishabh has been weaving stories for over 10 years and prides himself on building brands with a strong identity.
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