Mutual Fund Performance Data For Better Investment Decisions

Mutual Fund Performance Data For Better Investment Decisions

When comparing mutual funds in Thailand, it is important to look at the portfolio turnover ratio in conjunction with the expense ratio and the fund manager’s track record. It is also useful to compare the fund’s underlying holdings to those of similar funds in the same category.

By using a peer benchmark, checking fees, analysing turnover ratios and looking at risk-adjusted returns you can make more informed investment decisions.

Expense Ratios

Expense ratios, which include management fees and administrative expenses, show how much a fund charges on an ongoing basis to run its business. Sales loads are not to be mistaken with expense ratios, which are transactional charges that include a percentage of costs to buy or to sell shares as well as compensation for brokers. Investors should be aware that sales load expense ratios are separate from operating expenses and can vary widely from one fund to the next.


Investing in funds that have lower expense ratios allows you to leave more money for growth and compounding. Investing in funds that have higher expense ratios will reduce your overall investment performance and reduce your returns.

A fund’s expense ratio is its total annual fee expressed as a percentage of its assets. A mutual fund with a 1 percent expense ratio will use 1% of assets every year to pay for administration, management and advertising costs.

Many investors use the expense ratio as a proxy for a fund’s quality, and a low expense ratio indicates that the fund is well managed and likely has a good chance of yielding solid returns over time. But this is not a foolproof way to find the best mutual fund for you, because it’s important to consider other factors as well.

A high expense ratio is not always a sign of poor management. In fact, some funds have higher expenses because they are pursuing specific goals or strategies. For example, actively-managed funds require a group of managers and researchers who constantly review investments and rebalance portfolios to try to earn better returns than market average. This additional research and involvement may result in higher fees for management, which are then passed on to investors.

Fund Fact Sheets

Fund factsheets are a great resource for investors looking to learn more about the pros and con of a specific mutual fund. They provide an overview of a fund’s investment objective, fees, holdings, and past performance. They can also be used to compare funds in the same categories or to learn more information about a particular fund. They may also include a summary of the fund manager’s commentary on current market conditions and the investment strategy.

The next section of a fund fact sheet outlines the key performance data for a given time period. This includes total returns, calendar year returns, and annualized returns. Investors can use this information to see if a given fund has performed well over the long term and to assess its historical returns in various market environments. The performance of a fund in relation to a peer group can also be found on a fact sheet. Investors can compare a fund to similar peers within the same category in order to determine whether it is performing well.

A fund fact sheet will typically list the top 10 holdings over a period of time. This can be a good indicator of how well diversified a particular fund is and what sectors it is invested in. It can also show whether a fund is positioned to invest for growth or value.

A fund factsheet should also include any minimum investment requirements for the purchase and sale of stocks, as well tax treatment of capital gains and dividends. Investors should discuss the fund fact sheet with their advisor and seek additional resources if needed to ensure they are comfortable before making any investment decisions.

Portfolio Turnover Ratio

A fund’s portfolio turnover ratio is the percentage of its holdings that have changed in a given year. This metric gives insight into the trading strategies of the fund manager. A low turnover ratio typically indicates a buy-and-hold investment approach. A high turnover rate may also indicate aggressive trading. This can lead higher transaction fees and reduce the overall returns of a fund.

The portfolio turnover ratio can be calculated by dividing by the average net asset value of the fund during the same period the number of securities purchased or sold. This gives a rough indication of how often the fund changes its positions. However, it is important to note that many funds may hold some of their holdings for a period of years, so even a high turnover rate could mean that only a small percentage of the fund’s portfolio was churned.

Generally, funds that have lower turnover ratios perform better than those who have higher turnover rates. This is because the more frequently a fund sells and buys securities, the more expensive it is to execute these transactions. Additionally, the resulting capital gains taxes that must be paid by investors can also hurt the performance of a fund.

Turnover ratios may not be a foolproof measure of fund performance, but can give important clues to the fund manager’s strategies. If a fund’s ratio of turnover suddenly jumps up from 20% to 80% it could be a sign the manager has changed strategies.

The portfolio turnover rate is a crucial factor to consider when choosing mutual funds. The lower the portfolio turnover ratio, the better your client’s long-term performance will be. In addition, a low turnover ratio will typically minimize the risk of short-term losses due to market fluctuations.

Sharpe Ratio

Sharpe ratio can be used as a measure to compare mutual funds. It is calculated as the return on a fund’s investment minus its risk-free rate, divided by its standard deviation. This metric allows investors to understand the level of risk they take with their investments, and decide if the returns are worth taking. This metric is not the only one to consider when selecting a mutual fund.

The Sharpe ratio was developed by Nobel laureate Harry Markowitz, the founder of modern portfolio theory. It measures the excess returns of an asset compared to its risk-free return per unit of volatility. To calculate the ratio, subtract a risk-free rate, such as the yield on a short-term government bond, from the return on an investment and divide it by the return’s standard deviation. The higher the rate, the better.

Using the Sharpe ratio is an effective way to evaluate the performance of a fund. It is important to note that the Sharpe ratio does not take into account correlations between assets within a portfolio. Therefore, it is important to regularly review and rebalance your portfolio. This will help ensure that your investments are aligned with your risk tolerance.

To calculate the Sharpe for a certain period, divide by the standard error the average of daily returns. The ratio will be more accurate if the returns are measured over a longer period, such as a year. Moreover, using leverage can affect the Sharpe ratio because it increases both the numerator (return) and denominator (standard deviation).

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