A lot of investors send us queries about the ambiguities they face while trying to select a mutual fund to invest in. When we answer investors’ questions on fund selection, we often tell them to evaluate a fund’s performance over an entire market cycle. What this means is that you should not consider just the returns generated by a fund during a bull run, you should also look at how it has fared in struggling markets. A good fund would be one that has managed to beat its category and benchmark during the good times, and has fallen relatively less than its peers in bad times. Such a fund would be an ideal pick for most long-term investors.
This strategy of fund selection seems easy enough, but how do you find out the returns that mutual funds have earned over specific time periods? Where would an ordinary investor get the data of returns earned by funds between two dates? Needless to say, we have the answer to these questions – the Value Research Point-to-Point Returns tool. One of the many free-to-use research tools available on www.valueresearchonline.com, Point-to-Point Returns gives you the returns earned by mutual funds over two dates specified by you.
Begin with specifying the Start Date and the End Date. These dates define the period during which you’re interesting in looking at the funds with better returns.
Next, choose the Fund House if you’re interested in investing in funds only from a particular AMC. If you want to keep your options open, select ‘All’.
The next selection is the most important one. To narrow down your choices, select the Category of funds you want to invest in. You can look at the returns from funds from all equity categories, all debt categories or specific categories within these asset classes.
With that done, you can further narrow down your search by selecting the Fund Type, which lets you pick between open-ended and closed-end funds, and the Value Research Fund Rating, which allows you choose funds that have been assigned a particular star rating.
Once you’ve selected the options, hit the ‘Get Data’ button and you’ll be taken to a list of the funds that match the criteria specified by you. This list shows you the scheme name, start date NAV, end date NAV and returns generated over the period defined by you. You can sort this table as per your preferences.
This is how the Point-to-Point Returns tool tells you the funds that have performed the best over a particular period. It is the easiest way to make fund selection a simpler process.