Any fund manager overseeing a mutual fund will constantly be churning their portfolio to get rid of underperformers, take profits on stocks, buy potential bets, rebalance holdings or align to a specific strategy. But portfolio turnover can increase costs for investors due to the periodic buying and selling. There is also a concern about why a fund manager sometimes churns too much or too little. Here’s why investors must keep tabs on a fund’s churn, measured by the portfolio turnover ratio.
