Understanding the key terms in your mutual fund statement

Mutual fund statement
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A mutual fund statement also known as consolidated account statement (CAS) contains a summary of all investments made with a specific fund house across several schemes. It also provides investors with details of their holdings, transactions, fund performance, fees, and other important information related to their mutual fund investments.

In this article, we discuss what to read in mutual fund statement and they key terms in mutual fund statement.

  • Table of contents
  1. Mutual fund statement overview
  2. Key terms in your mutual fund statement explained
  3. FAQs

Mutual fund statement overview

Investors get a bird’s eye view of their mutual fund holdings with the help of a mutual fund statement. You can see how your investments have performed over time, the asset allocation details, associated expenses etc. Also, mutual fund statements are important for tax purposes as they allow you to report your investment income (including dividends) and capital gains correctly.

Additionally, mutual fund statements may also provide market updates, definitions of key investing concepts, and performance indicators. Investors can use this data to better grasp the basics of investing and make well-informed investment decisions.

Let’s check out the things to read in mutual fund statement.

Key terms in your mutual fund statement explained

  • Folio number: Each investor has a unique folio number that is provided by the fund house. This number serves to identify your specific portfolio.
  • Personal details: Your complete name, mailing address, phone number, email address, birth date, and investor category will be shown under “personal details” of the mutual fund statement. This part also includes your PAN number.
  • Nomination: A nominee is someone you have designated to receive your mutual fund investment in the event of your demise. The section on nominations will indicate whether you have chosen a nominee. If you haven't already added a nominee, please do so as soon as possible. Having a nominee facilitates the smooth transfer of assets in the event of an unfortunate event.
  • Details about the advisor or distributor: The advisor or distributor's name and Application Reference Number (ARN) are shown under the advisor or distributor details.
  • Bank information: This section includes information about your bank account, such as the name of the bank, the IFSC code, and your account number.
  • Transaction details: The statement lists all transactions within the specified period, including purchases, redemptions, exchanges, and any dividends or capital gains distributions received. Each transaction is typically accompanied by the date, amount, and type of transaction.
  • Performance summary: Includes the fund's total return for the period, which reflects changes in the fund's NAV price plus any distributions made to investors.
  • Asset allocation: Some mutual fund statements provide a breakdown of the portfolio's asset allocation, showing the percentage of assets invested in different asset classes such as stocks, bonds, cash, and other securities.
  • Fees/expenses: Include management fees, operating expenses, sales charges (if applicable), and other costs deducted from the investor's account.

Conclusion
Reading and interpreting mutual fund statements is key to investing in mutual funds. Knowing the right terminology can enable you to make educated decisions related to investments. Mutual fund statements are invaluable for investors to track the performance of their investments, monitor their portfolio holdings, and stay informed about any changes or developments.

FAQs

What should I do if I don't understand a term in my mutual fund statement?
If you come across a new phrase in your mutual fund statement, look it up using reputable financial resources or contact your fund provider for clarification. Understanding every facet of your investment is critical for making educated decisions.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
This document should not be treated as endorsement of the views/opinions or as investment advice. This document should not be construed as a research report or a recommendation to buy or sell any security. This document is for information purpose only and should not be construed as a promise on minimum returns or safeguard of capital. This document alone is not sufficient and should not be used for the development or implementation of an investment strategy. The recipient should note and understand that the information provided above may not contain all the material aspects relevant for making an investment decision. Investors are advised to consult their own investment advisor before making any investment decision in light of their risk appetite, investment goals and horizon. This information is subject to change without any prior notice.