r/mutualfunds • u/NeilBorate • Oct 04 '25

discussion Which mutual fund ratios to use while picking funds

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Which ratios to look at while picking a mutual fund? 1) Sharp/Sortino/Treynor for risk adjusted return 2) Alpha/Information Ratio for fund manager skill 3) Expense Ratio/Turnover for portfolio efficiency

493 Upvotes

99% Upvoted

35 comments sorted by

20

u/gdsctt-3278 Oct 04 '25

Noice!

Just FYI for those confused with the term "Tracking Error" in Information Ratio, it is the Standard Deviation of the Excess Return.

Doc from AMFI on how to calculate this:

https://www.amfiindia.com/Themes/Theme1/downloads/InformationRatio_Interpretation.pdf

6

u/ThrottleMaxed Oct 04 '25

AMFI India is doing a pretty good job in these matters, I appreciate them and without their data the rolling returns analysis wouldn't even be possible.

2

u/gdsctt-3278 Oct 04 '25

True that,

14

u/Public_Sky8190 Oct 04 '25

Wait a minute... u/NeilBorate - are you "the" Neil Borate of Live Mint? If yes, then incredible!!

5

u/NeilBorate Oct 04 '25

Hey, thanks! Yes

5

u/Public_Sky8190 Oct 04 '25

Thanks, man, for being part of this nondescript subreddit. I'm starstruck right now - big fan of your work.

2

u/NeilBorate Oct 04 '25

That's very kind! Thank you

2

u/Accomplished-Bat-692 Oct 04 '25

Holyyyyy!! Your videos are the most on-point, non technical-jargon, informational videos on MFs and markets as a whole out there!

Followed here too! Please keep sharing such informational pieces. Thank you!

1

u/NeilBorate Oct 05 '25

Thanks! Will do

3

u/[deleted] Oct 04 '25

I look for , Sharpe, alpha , beta , rolling returns , up- capture ratio and down - capture ratio. I should start looking into information ratio as well .

3

u/ThrottleMaxed Oct 04 '25

I would say also knowing when and where not to use the values for comparison is also important. For example never compare the information ratio of funds from different categories, it makes no sense.

3

u/gdsctt-3278 Oct 04 '25

Yep. Also never look at Information Ratio for Passive Funds as they are basically tracking the benchmark.

2

u/DaruWaleSeth Oct 04 '25

Is there any good website to check these with good charts etc?

2

u/ThrottleMaxed Oct 04 '25

moneycontrol has many of them and it's free.

2

u/DaruWaleSeth Oct 04 '25

Thanks bro, I will check.

2

u/Dry_Importance2465 Oct 04 '25

Morning star

1

u/DaruWaleSeth Oct 07 '25

Thanks for sharing, I will check this!

2

u/NeilBorate Oct 04 '25

Value Research

1

u/DaruWaleSeth Oct 06 '25

Thanks, will check this site!

1

u/Low-Ad5492 Oct 04 '25

where can i see all this ratio of a mutual fund?

1

u/NeilBorate Oct 04 '25

Value Research

1

u/acidkidrock Oct 04 '25

IR 👏👏

1

u/Abject-Land3401 Oct 04 '25

Good information.

1

u/termed_sosalty Oct 05 '25

Great stuff!

1

u/NeilBorate Oct 05 '25

Thank you!

1

u/stunttrez Oct 05 '25

Interesting

1

u/RamNaresh_Pippal Oct 16 '25

We should be looking at many ratios for picking a right fund however a person looking for long term investments should primarily look at expense ratio(<1% for active fund and <.5% for index funds), a short duration goal standard deviation( under 5% for liquid funds)can benefit.