Mutual funds have become a very favourite investment tool among many for wealth creation these days. The act of choosing the right mutual fund is indispensable for achieving your financial goals; however, investment alone is not enough. You would have to monitor the mutual fund portfolio's performance so that your investments will be on track. Monitoring the performance of your mutual fund portfolio will help you make better decisions and make necessary adjustments whenever there is a need for it.
Ways to monitor the investments in your mutual fund
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Using Online Portfolio Trackers
Since people now are more tech-oriented, using online portfolio trackers would be the easiest method to monitor one's mutual fund investments. Many online tools give you a holistic view of all your mutual funds, including those invested through multiple Asset Management Companies. Trackers can provide additional details, such as assessing investments, comparing the performance of your portfolio against the benchmarks of NIFTY 50 indices, and showing aspects such as sector allocation, equity mix, hidden fees, and underperforming funds along with risk exposure. Some of the popular portfolio tracking websites also allow you to monitor alerts for events such as new NAV updates or distribution of dividends.
The net value of your online mutual fund tracking account gives you a comprehensive view of your investment portfolio and the basis on which you decide whether you should hold, sell, or buy more units in a particular mutual fund scheme.
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Refer Monthly Mutual Fund Fact Sheets
Most Asset Management Companies (AMCs) make available monthly fact sheets for all their mutual fund schemes. One can find in these documents a swift glance at the mutual fund's performance as well as its portfolio composition and other relevant metrics. In most of the fact sheets, key holdings, sector and asset allocation, volatility measures, expense ratios, and fund performance compared to its benchmark index are included.
Reviewing these fact sheets regularly will let you know whether the fund is operating well and what changes, if any, the fund manager has made in your portfolio. You could, with the data, check if the mutual fund matches your investment objectives, risk tolerance, and financial goals. The fund may have been underperforming for a long period of time, and you might want to reassess your investment in that scheme.
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Check with Your Investment Advisor
If you have an investment advisor or financial planner, tap on their experience and expertise with regards to your mutual fund portfolio. An advisor can provide expert views, suggest portfolio optimization strategies and, at best, find areas in your investments that could be rebalanced or diversified.
An investment advisor will also make you aware of changes in market situations that will impact your mutual fund investments. Changes in your financial situation, increased risk appetite, or altered life goals may necessitate suitable modifications to your portfolio. If you're a first-time mutual fund investor or feel you can't monitor your investments, support from an advisor is invaluable.
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CAS (Consolidated Account Statements)
Consolidated Account Statement is basically an amalgamation on a common platform of all mutual fund transactions from various fund houses. It means depositories like CDSL or NSDL will report back month after month to the investor an overall view of all their investment as reflected in purchase transactions, redemptions, dividends, and other transactions.
You can download your CAS either to your registered email address or view it online from the CAMS website. CAS is an excellent tool for mutual fund investments since, besides throwing up the record of the holdings, it even serves as a great reference for all the tax planning and other financial requirements. It is particularly handy when you have multiple folios and investments with various mutual fund houses.
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AMC Websites or Mobile Apps
Most of the AMC's have their respective websites and mobile apps through which you can track the performance of your mutual fund investments. You can login to your accounts for accessing the respective performance of the fund you have invested in, check the NAV updates, refer to historical returns, and even check the portfolio composition.
Although it can be pretty convenient to keep an eye on your investments with an AMC-specific platform, it may not be ideal for investors who have more than one mutual fund through different AMCs. In that case, trackers of portfolios or consolidated account statements serve the purpose better to get a comprehensive view of their investments. However, AMC platforms can still be useful to keep track of what is going on with every single fund-for example, to stay up to date with news and developments.
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Utilize Mobile Apps for Real-Time Tracking
One can utilize mobile apps that are mainly designed to help in mutual fund tracking. These apps make you well-equipped with your live data regarding your investment and allow you to track the performance of your funds while on the move. They will also offer additional features in the form of an SIP calculator, investment suggestions, and customized alerts on market changes or fund performances.
With the mobile app having tracking features, you will never tend to be too far away from your portfolio, thus enabling you to take swift decisions at will. It is mostly useful for active investors who keep track of their portfolios and want to keep abreast of the latest market trends.
Why Track Your Mutual Funds?
Not only do you check returns, but monitoring your mutual fund investments regularly also translates to understanding how the underlying portfolio is performing and identifying any changes in risk factors that maybe should have adjustments made to keep investments in tune with goals. Regularly tracking mutual funds ensures you can promptly respond to shifting markets, balance when necessary, and capitalize on new investment opportunities.
With the use of these tracking methods, one is in a position to keep heads above the game of investments, to make better financial decisions, and to ensure that investments in a mutual fund work towards long-term financial goals.