Recognising when it's time to sell that fund

Many mutual fund investors tend to think that once they have bought a fund, they can stay invested in it forever and wealth creation will just happen. Alas, not all funds are meant as a lifetime investment. You must review your fund's performance periodically and decide whether it is doing well or not. While not every bit of bad news should get you worked up, here are some situations when you may consider exiting a fund. Fund performance If a fund has been consistently underperforming in its category, or even worse its benchmark, this is definitely a red flag. However, you shouldn't exit a fund just because it underperforms in the short term. Even good funds that have outperformed for decades can face temporary setbacks. In such cases, stay invested and wait for a recovery. You may use Value Research's star ratings to assess a f

This article was originally published on August 03, 2020.