How To Evaluate Your Mid Cap Mutual Funds?
There are various ways to evaluate your Mid Cap Mutual Funds. Take a closer look at the basis of various parameters:
Performance and risk analysis.
This is one of the most important metrics to analyse your mid cap mutual funds. If the mid cap has shown consistency in performance across various market periods with calculated risk adjusted returns. Before investing make sure to check what was the fund performance during the short term and long-term periods such as 1 year, 3 years and 5 year, depending upon the risk- reward ratios like Sharpe Ratio, Sortino Ratio and Standard Deviation.
Performance across Market Cycles:
An investor before investing make sure to check, whether the fund can perform consistently across different market cycles. Before investors Invest in Mid Cap Mutual Funds one should compare the performance of all the available mid cap funds vis-a-vis their benchmark index across bull phases and bear phases.
Assessment of Portfolio Quality:
The investor must access their portfolio should be well diversified and the exposure to the top 10 holdings should be ideally under 50%. Also, from the investor point of view, make sure to note down the portfolio turnover ratio and expenses as well as fund manager performance over a time. Further make sure to ensure that the mutual fund house has a track record of consistent performance over different schemes.