10 things to keep in mind while reading your fund statement

Do you ever visit a restaurant, and after having a scrumptious meal, pay the bill without reading it? Or has it ever happened that you paid your mobile phone bill without checking the details? Most people don’t do this because it is their hard-earned money and they want to spend it carefully. And rightly so. Who would want to pay extra unnecessarily?

Therefore, checking your bills and bank statements before paying is one of the good habits that people nurture. However, this is not usually followed as religiously when it comes to mutual fund statements. Yes, fund houses do generate monthly statements and it is very important that you understand it well. Some of the details in your fund details include:  

1. Personal details

This is the first thing you need to check in the fund statement, i.e., is your name rightly printed on the fund document. Then check the address mentioned and see if it matches the one you had provided. If there is any discrepancy, flag it immediately to your relationship manager or mutual fund distributor.

2. Bank account details

Next comes the bank details. These include your bank name, bank account number and IFSC code among the basic details. It would also have your PAN information as it is mandatory by the regulatory body. Ensure that all the details are right as per your records and there is no typing error.

3. Fund name and options

This is where your fund is separated from all other funds you have. The name of the fund along with the option of dividend or growth is mentioned in this section. If the details mentioned in the statement does not matches with your choices, please bring it to the notice of your fund house at the earliest. This would save you from the hassle of staying invested in the wrong fund.

4. Agent/ Broker Name

This highlights the name of the broker or agent if you have one. In case of multiple brokers, it would have their names with a remark of multiple brokers mentioned there. 

5. Folio number

It is like the registration number of the vehicle. This unique code becomes your identity for future transactions. You simply have to quote the number to make any investments in the particular scheme or even invest in any other scheme of the same mutual fund house.

6. Current cost and market value

The current cost helps you to obtain a certain number of units for a certain value of NAV. This gives you a bird’s eye-view of the value addition of your investment in the fund. It is usually of the day when the report is generated.

7. NAV as on a particular date

Net Asset Value (NAV) changes everyday, and hence, it would be representative in nature when you receive it. The NAV printed would be of the day the report was printed and usually there is no drastic change in short-period.

8. Transaction summary

This has a list of transactions that you have done with the fund house. So your Systematic Investment Plan (SIP) or Systematic Withdrawal Plan (SWP) details are also mentioned in this section.

9. Dividend payout and reinvestment

It also mentions the value of dividend payout at the bottom of the section. It even highlights how it is reinvested when you choose for it.

10. Load structure

This mentions the entry and exit load charged while entering and leaving a particular fund. This comes useful when you wish to enter a fund or when you wish to sell units and exit from it. The lower the load structure, the more profitable it is for you.

Mutual funds deal with the money that you have earned after years of hard work. Therefore, it is your own interest to take them seriously. Pay close attention to your mutual fund statement and get errors rectified.