Since the universe of mutual funds is vast with hundreds of funds out there, investors can use the new riskometer provided by SEBI, to choose schemes which are in sync with their risk appetite. This meter is especially useful to investors who are new to the world of mutual funds and is not clear about the scheme matching their RISK PROFILE.
However, it is essential to note that the riskometer can give an overall idea of the risk level, there are many other factors involved that should be considered while selecting a fund and a riskometer should not be the sole indicator.
About Mutual Fund
Mutual fund is a trust that collects money from a number of investors who share a common investment objective
| Score Range | Risk Category | Interpretation | Indicative Asset Classes |
|---|---|---|---|
| 9-9 | Conservative | Low risk tolerance with primary focus on capital preservation and stability. | Liquid Funds, Overnight Funds, Money Market Funds, Ultra Short Duration Funds, Banking & PSU Funds and other low-risk debt oriented funds. |
| 10-12 | Moderate | Balanced approach between safety and long-term wealth creation with moderate volatility. | Balanced Advantage Funds, Multi Asset Funds, Aggressive Hybrid Funds, Large Cap Funds, Multicap, Flexi cap and Mid Cap, etc. |
| 13-21 | Aggressive | Comfortable with higher market fluctuations in pursuit of long-term capital appreciation. | Flexi Cap Funds, Multi Cap Funds, Large & Mid Cap Funds, ELSS Funds, Index Funds, Hybrid Funds and Diversified Equity Growth Funds. |
| 22-30 | Very Aggressive | High tolerance for market volatility and long-term equity-oriented wealth creation. | Mid Cap Funds, Small Cap Funds, Sectoral Funds, Thematic Funds and diversified equity growth funds. |
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