How To Read A Mutual Fund Statement?

Mutual funds offer investors an opportunity to diversify their portfolio and mitigate risks, and this is one of the factors that contribute to the growing popularity of mutual funds. Just like other investments, you must review such mutual fund investments periodically. The statement of account you receive from the fund house is a trove of information. If you know how to read a mutual fund statement correctly, you can get a lot of valuable information from it.

So, how to read a mutual fund statement?

A mutual fund statement is a summary of your investments that the fund house shares with you periodically. Some aspects contained in it are as follows:

  1. Folio number

A folio number is a unique identification number mentioned at the top of your mutual fund statement. The folio number has the same purpose as your bank account number; it identifies your investment with the fund house. You can hold multiple holdings with a fund house under one folio number.

  •  Investor details

A MF statement is addressed to the investor, registered as the sole or primary holder (in case of a joint holding). The statement also has the name of joint holders (if any). It has your address, contact details, date of birth, PAN details, mode of holding, investor category and KYC status.

  • Nomination

Your statement also highlights the nomination status for your account. If you have assigned a nominee who has the right to claim the investments on account of the primary holder’s death, the nomination status shows as “Registered”.

When you go through the statement, do check if a nomination has been registered. Being aware of the nomination status can save your family members from unnecessary hassles in the future.

  • Bank details

A mutual fund statement mentions your bank details, which includes the bank name, account number (masked), and the IFSC code. Ensure that these details are accurate as the proceeds are sent electronically or through a cheque to the mentioned account.

  • Transaction details

The statement reflects your transactions for the statement period. Going through transaction details helps you stay informed about the scheme name, the amount you have invested, amount redeemed, the number of units you hold, any switches you may have made and the NAV at which you bought the units. Always pay close attention to these details.

  • Portfolio valuation

Your statement gives you a summary of your portfolio valuation too. You can calculate your overall returns based on the cost at which you bought the units and the current NAV. Going through the statement helps you learn about mutual funds and aids you in your overall financial planning. You can choose to invest more based on how a scheme is performing or exit it.

  • Systematic Investment Plan (SIP) details

SIP details, like the scheme name, the start date, the end date, investment amount, are also mentioned in the statement. These details help you plan your outflows and investments better.

Going through your statement also keeps you updated about the nearest investor centre, your advisor (if any), exit load etc. This information helps you make informed decisions about future investments or current holdings. You can choose from the best performing mutual funds in India based on returns, exit load etc., to get maximum returns with minimal costs.

Hence, do not just skim through your mutual fund statement or toss it aside. You should be aware of the jargon used, and the information provided in it. Financial awareness helps you make the best of your investments and keeps you safe from fraud or negligent mistakes.