M. Pattabiraman's Blog, page 121

A screener to select mutual funds with lower risk & higher return

Here is a simple way to select mutual funds that have beat the category benchmark in terms of both return and risk over the last one, two, three, four and five years simultaneously! That is higher than the benchmark return and lower than the benchmark risk. This option is available in our monthly MF fund...

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ETF tracking error screener Aug 2022

This is an ETF screener based on tracking errors and tracking differences (ETF return minus index return). The screener will help a user evaluate how efficiently an ETF has tracked its underlying benchmark. The tracking error is simply the ETF’s standard deviation minus index monthly return differences. The lower the tracking error, the more efficient...

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Can I use ultra short duration funds instead for short-term goals?

A reader asks, “You usually recommend money market funds for short-term goals. Can we also consider Ultra Short Duration Funds for this purpose?’ The definition of money market funds is simple: “Investment in Money Market instruments having maturity up to 1 year”.Ultra-short duration funds are defined as “investment in Debt & Money Market instruments such...

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Conventional ETF tracking errors can be misleading here is how to correct them

In this article, we explain why conventional ways of measuring ETF tracking errors can be misleading and present an alternative. The efficiency of a passive fund (index fund or ETF) is measured by the tracking error or tracking difference. The tracking difference is simply the fund return minus benchmark return. This must be a small...

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Axis Nifty 100 Index Fund Performance Report

Axis Nifty 100 Index Fund is an open-ended index that aims to achieve a return close to Nifty 100 subject to tracking error.  The Fund was launched in Oct 2019 and currently has an AUM of about 760 Crores. When the fund launched, we reviewed the underlying index in detail and mentioned that we needed...

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Equity Mutual Fund Screener Aug 2022: Shortlist consistent performers

The freefincal Equity Mutual Fund Performance Screener (Aug 2022) is now available. Use it to screen for consistently performing equity mutual funds. You can screen based on fund category & benchmark and spot mutual funds with a higher return than a benchmark at a lower risk. Inside, you get discounted links to our two courses:...

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Will PPF interest rate be increased after three RBI Repo Rate hikes?

A reader wants to know,” Will the Public Provident Fund (PPF) interest rate be increased after three successive RBI repo rate hikes?” The PPF interest rate does not directly depend on the RBI repo rate. Some history is in order to appreciate how small saving interest rates are decided. Several committees that have discussed the...

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Are Focused Mutual Funds better than Index Funds?

A reader asks, “Can you please do an analysis on focused mutual funds and discuss if they are a better choice than index funds?” What is a focused mutual fund? According to SEBI, it is an open-ended equity scheme focused on the number of stocks (maximum 30). The minimum investment in equity & equity-related instruments...

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How to start investing in debt mutual funds – a primer

This article lists the essentials an investor needs to keep in mind before selecting debt mutual funds. (1) Debt mutual funds are not replacements for fixed deposits! Do not take product manufacturers (AMC guys) and sales guys seriously! A fixed deposit in a bank too big to fail has a risk so small that it...

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All the financial advice you need can fit in a 3×5 inch card!

When Dilbert cartoonist Scott Adams could not find a publisher for a one-page book on “Everything you need to know about financial planning”, he was forced to write a 368-page book – Dilbert and the Way of the Weasels. (Ref: MyMoneyBlog) You don’t even need a page to hold all the advice that Adams gives. All...

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