VR Logo

Apples And Oranges

Comparing two funds from different categories & with different investment mandates is like comparing apples to oranges…

I have SIP investment of Rs 2,000 in Magnum Multiplier Plus for a year. However, in recent times I observe that Magnum Emerging Businesses is performing better than this fund, should I switch my investments?- Sunil Jog

Fund Scheme  Category  Rating  3-yrs ret (%)  5- yrs ret (%)
Magnum Multiplier Plus Multi Cap *** 15.11 16.51
Magnum Emerging Businesses Mid & Small Cap *** 22.41 17.43
Returns as on July 22, 2011, Rating as on June,2011

Before you start, you must have a financial goal or need. This approach will help attain the desired clarity on the investment objective, the tenure of the investment and the expected return on such investment. The two funds that you have selected are from different categories that have different investment mandates. Comparing the two on performance parameters is akin to comparing apples to oranges. If the investment in Magnum Multiplier Plus has achieved its objective, you may move to another fund. However, when investing in mutual funds, look for a fund that is consistent and has a proven past-performance track record. Also analyse the fund’s performance over the long run in both bull and bear markets when you invest in them and not just short-term performance.



Post Your Query