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A research carried out by Axis Mutual Fund titled ‘India Investor Risk Report 2023’ reveals that while mutual fund investors have heard the disclaimer ‘Mutual funds are subject to market risks, read all scheme related document carefully before investing’, majority of them or 78% investors do not understand these market risks. These investors say that they want to understand more about these market risks.
The study shows that 59% of MF investors still look at past performance to shortlist funds. “Considering the past performance for choosing a mutual fund, is like driving while looking in the rear-view mirror. However, investors seem to be looking at this indicator as a deciding factor while selecting a fund,” said the fund house.
Here are some other key findings of the report.
- 89% investors agree that ‘understanding risk appetite’ plays a significant role in their investment journey
- Of this, 55% of the respondents were not aware of risk-o-meter as a tool to assess mutual fund risk and 69% were not aware of risk profiler as a tool to assess individual risk
- 53% investors said they were not confident when it came to assessing their risk capacity for choosing a mutual fund
Axis Mutual Fund conducted a PAN India survey with existing investors via email where 1740 investors actively participated. The survey consisted of 9 questions on two of the important tools for assessing risks in mutual fund – risk-o-meter and risk profiler.
