Techniques for judging best fund

Mutual funds are the fund houses which invest our money in select equity shares and bonds depending on the type of the mutual fund scheme. An equity mutual fund will be investing in shares of the companies while a debt fund will be investing in bonds and other such financial instruments. A balanced fund will invest in both the types of the investments in some ratio. Before going to find out ways to identify better fund schemes, let us try to understand the basis on which such decisions are required to be taken. The mutual funds growth depends on the share market growth. Share market consists of so many companies. They are in fact categorised in various segments also like Pharma, FMCG, Banking, Fertilisers, Services etc. Now all the sectors will not go up or have similar growth patterns. In fact some of them may go down also. Hence, in this scenario it is very likely that the mutual funds will also swing in the same way following the trend of those shares. Following these points it is imperative that we should check the holdings of a mutual fund before investing in it. Which are the sectors where the particular fund scheme has invested. Once we check that then we can have a feel of its speculative success in the coming times. From the financial news we can find out which segments or sectors are likely to progress in the coming times and naturally the mutual funds which have invested in them heavily will be in advantageous situations.

It looks simple and straight forward but requires detailed analytics and one has to devote considerable time in studying those aspects and then taking a conscious decisions. If one has a god understanding of share market then one can directly invest in it because mutual funds are also going to do same thing for us. Many people who have no knowledge of share market and its fluctuations go and invest in mutual funds so that fund houses can perform that job for them. In fact mutual funds do it in the best possible ways and many of them churn their portfolios also time to time to increase the returns.

Another thing is the past performance of a fund scheme. Though past performance is not a guarantee for the future one but to some extent it reflects on the efficiency and dynamic working of a fund and can be expected as one of the factors to choose them. One more point in this reference is that a balanced fund is sometimes more safer as it has both the components there. The equity component which is the high risk high gain area and the debt component which is low risk low gain area. Due to its mixed nature many people opt for the balance funds.

The performance of a mutual fund scheme can be judged by its net asset value on our regular monitoring relating to performance of a particular fund falling under the open ended scheme. In case, it is an open ended fund, the same can be evaluated on weekly basis.
The mutual funds publish their performance in the interval of half an year at least indicating different parameters reflecting its financial health such as present net asset values, directors and promoters involved in such a business, its reputation and trusts among the investors etc.
At the same time, the returns and yields over a period of time ie quarterly, six months, yearly etc can be tracked down, Investors can also look into other related informations like percentage of expenses of the total assets affecting the yield.
The mutual funds send their annual reports to the unit holders at the end of the year. Hence if we go through the various studies in relation to the mutual funds, we could collect their performance in terms of their yields by going through the financial magazines available in the market. The economic times contain different articles enriching your knowledge of the performance of various funds.
Apart from this many research agencies undertake their projects highlighting the performance of the different schemes and their research could benifit you to assess the rankings of the different funds.
Investors would be required to go through their schemes and should compare their results with the benchmark like BSE Sensitive Index, CNX, Nifty etc.
Once the performance of a mutual fund is known, the investors can decide to have this portfolio in his basket.

At present, most people want to invest in mutual funds, in such a way, having an interest in this field will also be beneficial for the future. Due to a lack of complete knowledge about the mutual fund, people choose an expert or agent for their investment who advises on the best investment plan for them. But for this, the agent should have a lot of knowledge, as well as the standard of morality in you so that the trust of the people always remains with you. Because people invest their hard-earned money, it is the duty of a mutual fund to maintain their trust.

It is first necessary for a mutual fund agent to register for NISM. It is a certification exam by the National Institute of Security Market. It can be registered both online and offline. Once you get this certificate then you have to register in a mutual fund association. After registration, an ARN number is issued to the agent, after which an agent can sign an agreement with any company and start their work.

To become a successful mutual fund agent one must strive for certain skills -

Conduct market research, keep a close eye on the financial movements occurring in the market, know how much profit and loss is being made in a company, especially those Copenias whose investment in Mutual Fund is very high.

Mutual fund agents should design ways to conduct efficient quantitative research for interest rates. You must carry out credit evaluation with global best practices.

Always keep in mind that you generate better business ideas, and you should come to identify any problems or bad debts. Analyzing loan and loan portfolio performance should come up well.

Understanding the Basel-based internal rating system is an important factor in improving regulation, supervision and risk management, etc. within the banking sector. You should have detailed knowledge about all these parameters.

Some organizations will help you in becoming a Must Fund Fund Agent -
Foreign Exchange Key, Visakhapatnam
Kunjbihari S Goyal Online Academy for Learning and Development (Gold), Mumbai
Institute of Career in Financial Market, New Delhi
Sydenham College of Commerce and Economics, Mumbai
New Era Institute of Professional Studies (NIPS), New Delhi
Focus Educare Private Limited, Bangalore
CSE Institute of Capital Markets, Kochi
Dutta Institute for Stock Market Education, Hyderabad
Stock Market Institute (SMI), Bangalore
Jain Arbitrage Destination, New Delhi

Mutual funds are very famous among investors today. The returns are attractive and there are various choices and options to select. But all schemes are not suitable for all. One should decide based on his/her investment objective and risk-taking ability.
There are two steps to be followed in the process of selecting a mutual fund. The first one is to select the category and the second is the selection of a scheme in that category.
For selecting a category of mutual funds you have to consider the following factors
1. Objective: Why you want to invest? What is your goal to accomplish with the money you get from the mutual fund? The investment objective can be long term or short term. To pay the fees of your children when they are getting admitted is a short-term goal. You want to have some fund by the time you retire. This is a long-term goal.
2. Time period: This can be short or can be long. I day also you keep or you can keep even for more than 5 years. Different funds will be good for different time durations. Basing on the time period these funds are divided into categories like liquid funds, ultra-short duration funds, short-duration funds, balanced fund and equity fund.
3. Risk tolerance: The amount of risk an investor is willing to take with his/her invested money is known as Risk tolerance. There are 5 levels of risk associated They are low, moderately low, moderate, moderately high, and high.

By studying the above three factors of a must fund category you can pick up a category. In that category, there may be many schemes. How to select it?

The following are the points to be considered.
1) Performance Against Benchmark
2) Performance Against Category
3) Consistency of Performance
4) Fund Manager's Experience
5) The track record of the asset managing company
6) Expense ratio
Based on the above points you can decide on the scheme in the category you wanted.
I suggest you get associated with a person who is already in the financial advisor position to various people and learn from him how is advising the people on the investments. Initially, you should understand the fundamentals and then you can start on your own. There are some online courses also which will help you in understanding the entire process very well.