Assest Management Company
There are 44 numbers of AMCs with over 11,000 schemes across various categories in India, and growing. The good thing is that we are spoilt of choices, but that’s just on the face of it. Recommending a combination of funds requires a great deal of study, skill and experience, starting right from listening to the need of the client, digging into the meaning of his needs to filtering and identifying just the right fund from the labyrinth of schemes, each with a unique feature.
Fund Entails
The process of recommending a fund entails, but not limiting to, understanding the duration for which the funds need to be invested. Whether the investment will be a one time investment or in installments over regular/irregular intervals. The risk the investor is willing to take, the time in which the investment may be withdrawn. The age and income profile of the investor along with his current portfolio across various asset classes.
Process Starts
Once the type of category is clear the process of identifying the right fund begins. In this process we look for a fund which has delivered excess returns over and above risk free return not taking as much risk as other funds in the same category. Another important parameter to evaluate a fund’s return is the downside risk measure. Cost of the fund, quality of the portfolio, track record of the fund manager are also evaluated. Since these parameters are dynamic and change over a period of time the data is analysed across various time frames. As and when the parameters change necessary recommendations are given to the client to tweak their investments. This helps the client to maximise gains with measured risks over a long time frame.
