Chapter 5 of 12

How to read a mutual fund factsheet

7 min read

Every fund publishes a monthly factsheet. It is the quickest way to see what a fund holds and how it has behaved, if you know where to look.

What to check, in order

• Objective and category: what the fund says it is trying to do, and which SEBI category it sits in.
• Benchmark: the index its performance is judged against.
• Fund manager and tenure: who is running it, and for how long.
• AUM: how large the fund is.
• Expense ratio: what it costs you every year.
• Exit load: any fee for withdrawing early.
• Portfolio: the top holdings and the sector split.
• Performance: returns against the benchmark across several periods.

Reading the portfolio

Look at how concentrated the top ten holdings are, and whether the sector mix matches what you expect. A fund that calls itself diversified but has a third of its money in one sector deserves a closer look.

Reading the performance table

Compare the fund with its benchmark over one, three, five and ten years where available, not just the latest year. Funds that beat the benchmark in one hot year often fall back, so consistency matters more than a single number.

This content is for education only and is not investment or tax advice. Mutual fund investments are subject to market risks; read all scheme-related documents carefully.