Mutual fund investments bring together a pool of funds from investors that share similar financial or investment goals. These are then invested into top-performing mutual funds that can bring returns aligned with the investors’ goals, whether short-term, medium-term or long-term. A very crucial aspect of this process is assessing and evaluating the past, present and potential performance of the mutual funds investments. In order to get a good grip on these parameters, investors should either have the time, the knack and the expertise to do these assessments, or they can rely on the mutual fund managers. Mutual funds managers are usually part of a larger Asset Management Company (AMC). So they have access to industry information and resources that can help them make better decisions about the investment avenues.
So is a mutual fund manager important?
The answer is a huge, emphatic yes! First of all, AMCs or mutual funds managers therein, bring with them a lot of experience. This experience can play a crucial, decisive role in making profitable investment decisions so that the funds generate good performance. An experienced fund manager would have seen many economic cycles, business developments, political and policy changes, issues that have a bearing on investment performance. Since all these issues are normally beyond the grasp of an average investor, a fund manager brings not just their own expertise and competence, but also the collective wisdom from the information and data that he has access to.
The ultimate goal is that the fund manager picks stocks and invests in them while keeping two solid objectives in mind. One, he or she should try to find avenues such that the portfolio is ahead of its benchmark and peers. Two, it is necessary that the portfolio aligns with the risk profile and financial goals of the investors. If they are a bunch of conservative investors, looking for capital protection and an assured return, the portfolio will be heavily dominated by debt funds. If they are inclined towards risk, equity funds will dominate the portfolio.
What exactly does a mutual funds manager do?
- Upkeep of compliance requirement: The Securities and Exchange Board of India regulates the mutual funds investments in India. So it becomes imperative to follow the reporting standards as per the regulatory guidelines and to comply with other legal regulations. Fund managers are responsible for abiding by these and also apprising the investors of such rules.
- Monitoring performance of the fund: Fund managers are also responsible to monitor and track the growth and performance of the mutual funds. They keep a constant track of the shifts, ups and downs that the market experiences. Thus, the operational task of a fund manager is to place an order for and buy/sell individual stocks/bonds from the portfolio to keep the investments optimal at all times. The mutual fund manager also analyses the competition in the industry to gauge a macroeconomic outlook and goes through resources like the annual results and reports of companies. As a part of an AMC, there’s a team at work: is the fund manager is assisted by the research team, junior fund managers and an operations team who collect, collate, compare and look incisively at these funds and options.
- The main task of investing: The fund managers primarily exist for investing the funds pooled together by the investors. In trying to optimise the investment, they check for the pulse of the stock market. They study quantitative parameters such as price-to-earnings ratios, sales, earnings, dividends and other metrics to make an informed choice of investing in stocks. When you open an account with Finserv MARKETS, you get detailed portfolio summaries and insights into the performance of your mutual funds investments. Empower your money and portfolio by investing in well-performing mutual funds today with Finserv MARKETS. You are delegating the investment to professionals: top-performing mutual funds are run by professional managers who pick different instruments to invest in, and so you can rest assured that your money is in expert hands. Depending upon your risk appetite, you can choose to invest in equity funds, debt funds or hybrid mutual funds. Since the investment in securities is spread across a variety of industries, sectors and companies, the risk is reduced.
Investing in mutual funds with Finserv MARKETS is easy too! All you need to do is submit your KYC documents and fill up a few details on the website. Once you open an account and make mutual funds investments, you can also get detailed portfolio summaries and insights into the performance of your investments.
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