Reading your mutual fund statement without a finance degree

Most people open their statement once, feel a little lost, and close it. That is understandable. It is a long document written for compliance, not for you. But a few lines carry most of what you need.

The usual one to ask for is the Consolidated Account Statement, often called the CAS. It lists your mutual fund holdings across fund houses in one place, which makes it far easier than collecting separate statements.

The six things to look for

1. The folio number. This is the account number for your holding with a fund house. If you see a folio you do not recognise, ask us.

2. The scheme name and plan. Check that the scheme is the one you meant to buy. Note whether it says Regular or Direct. If it says Regular, the fund house pays Valsynk a commission, and our commission page shows the ranges.

3. Units and the value per unit. Your holding is counted in units. The value per unit, the NAV, changes each day. Units multiplied by NAV is what your holding is worth that day.

4. Your transactions. Each SIP instalment appears as a line. Count them. If a month is missing, something went wrong with the bank mandate, and it is better to find out now.

5. The amount you put in against the current value. Look at both together. A single number out of context, a gain or a loss, says very little on its own.

6. Your nominee. Many statements show whether a nominee is registered. If it says none, or the name is out of date, fix it.

What you do not need to worry about

You do not need to read every line. You do not need to decode every code. And a number that looks bad in a bad month is not a reason to act.

How often

Twice a year is enough for most people. If you want us to walk through it with you, that is part of what we do, and there is no hurry.

Mutual fund investments are subject to market risks. Read all scheme related documents carefully before investing.