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Why compare Mutual Fund schemes?
- Having numerous options is beneficial but can also create confusion. Mutual Funds comparison allows investors to go through multiple choices, helping them make informed decisions aligned with their investment goals.
- By understanding how to compare MFs based on performance and other crucial features, investors can design a well-balanced investment portfolio that minimises risk and maximises returns.
How to Compare Mutual Funds: The Parameters
Mutual fund comparison involves evaluating various parameters to ensure the chosen scheme aligns with your financial objectives. Here are the key parameters to consider:
Advantages of Mutual Fund Comparison
![Avoiding common mistakes in Mutual Fund comparison](/content/dam/icicibank/india/managed-assets/revamp-pages/compare-mf/avoiding-common-mistakes-in-mutual-fund-comparison.webp)
Avoiding common mistakes in Mutual Fund comparison
In Mutual Fund comparison, steer clear of pitfalls for better decisions. Here are the common mistakes that investors should avoid:
- Don't fall into the short-term focus trap; 1-year returns may mislead, especially for volatile Equity Funds. Opt for a more insightful approach by considering long-term returns for a comprehensive view.
- Another pitfall is the single-criterion decision trap. Basing choices solely on one factor, like returns or risk, oversimplifies the process. A better strategy involves considering multiple criteria, such as consistency, risk measures and portfolio details.
- Lastly, pay attention to a holistic evaluation. Focusing only on performance numbers may lead to neglecting crucial factors. Adopt a comprehensive approach, considering various criteria for making the right decisions aligned with your financial goals. Avoiding these mistakes, helps navigate MFs strategically.
T&Cs.