Performance & Risk Metrics
Consistent rolling returns
3 and 5-year CAGR vs category benchmark across multiple market cycles
Downside protection
Maximum drawdown, recovery period, and downside capture ratio in bear markets
Risk-adjusted returns
Sharpe ratio and Sortino ratio relative to category peers over 3+ years
Alpha generation
Evidence of genuine active management skill beyond passive exposure to factor premia
Fund Structure & Management
Manager tenure & conviction
Minimum 3-year track record with the same mandate; clear, articulated investment philosophy
AUM sweet spot
Not too small to lack stability, not so large the strategy is capacity-constrained
Fund house quality
AMC stability, compliance culture, and investor-friendly track record on expense ratios
Cost efficiency
Expense ratio benchmarked against category; higher cost must be justified by demonstrated alpha
Portfolio & Operational Flexibility
Portfolio construction clarity
Concentrated enough to be meaningful; diversified enough to manage idiosyncratic risk
Liquidity & exit terms
Exit load period, lock-in clauses, and redemption ease evaluated against investor time horizon
Tax efficiency
Turnover ratio, dividend vs growth option suitability, and LTCG optimisation for the investor’s tax bracket
SIP & SWP operability
Minimum investment thresholds, SIP/SWP date flexibility, and platform compatibility for seamless execution