| Description | |
|---|---|
| Sectoral allocation |
It informs investors about a fund's concentration level in sectors and stocks. There are different sectors where the fund manager can allocate the funds to. While there are sector specific funds which invests the funds to particular sectors, other funds exposes the customer to different sectors. An aggressive fund manager may have high concentration among fewer companies and sectors, which may not be appropriate for investors seeking diversification. |
| Sharpe Ratio |
One of the most useful ratios in mutual fund industry, Sharpe ratio measures the risk-adjusted returns. It is the excess return over risk-free return divided by standard deviation. Funds with similar returns can be compared on the level of risk taken to generate the similar returns. |
| Standard deviation (SD) |
It measures the volatility of a fund's returns vis-à-vis its average. With mutual funds, the standard deviation tells us how much the return on a fund is deviating from the expected returns based on its historical performance. If a fund has 11% average rate of return and a standard deviation of 3%, its return will range from 8% to 14%. A volatile stock would have higher standard deviation than fund with less volatility. |
Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.
