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Personal Finance: Should an investor worry about turnover ratio in equity funds? 

Portfolio turnover ratio is relevant as it determines the level of churn in a portfolio. But it is not the only critical factor to gauge fund performance 

January 27, 2023 / 09:24 AM IST
Personal Finance: Should an investor worry about turnover ratio in equity funds? 

Investors must understand that the turnover ratio of a scheme is only one of the many parameters to select a fund and its performance.

Investing through mutual funds has now become the favoured mode for retail investors. But increasingly, the terms used by asset management companies in the fund fact sheets are complex and hard for a lay investor to comprehend, or simply escape investor attention. One such term is ‘Portfolio Turnover Ratio’ (TR) that indicates the frequency of the buying and selling activity happening within the portfolio of a mutual fund scheme. In other words, it indicates the percentage of a fund's holdings that...

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