How to Read a Fund Factsheet to Know Relevant Details

Corporate entities and individuals prefer investment assets offering risk-free returns. Investors generally seek expert advice for good returns on investment. They depend on institutional money managers, fund consultants, and private wealth managers for guidance. The intermediaries in the industry collect capital from different companies/individuals and put it into various investment assets.

How will an investor trust a fund manager with their money? Investors looking for funds count on fund factsheets to gather information. A fund factsheet issued by money/asset managers and fund consultants contains details about a particular fund, its risks, and its objectives. It is easy for investors to decide on the investment fund by reviewing the fund factsheet. A fund factsheet makes it easy to know the goals of an investment fund. Many investors face issues while reviewing factsheets. 

Read on to understand how to read a fund factsheet in detail.

The Headings

The name of the investment fund is on top of the factsheet. The fund name should be the same as advertised before making a decision. Mention the fund manager’s name in the topmost section of the factsheet. A fund manager might be a company or an individual. At the top section, the time when the factsheet was updated is visible. A factsheet updated many months back might not denote the current performance of the investment fund.

The Key Facts Section

Usually, factsheets include the “Key Facts” section. Other names in factsheets refer to the section. It informs the investors with some critical details about the investment fund. Investors should quickly find the ISIN, a unique identification number for each investment fund. Even though the investment fund has many names, its ISIN will be the same. Investors also need to find the base currency of the investment fund. If you give money to an investment fund in another currency, you should consider the base currency once. The section will also include other details like benchmark, legal structure, share class currency, domicile, and umbrella.

Fund Overview, Key Risks, And Investment Objectives

Fund factsheets have a dedicated section for the overview of the fund. The overview section will give you a broad outline of the investment fund. Most investors read the factsheet even further after finishing the overview section. An investor should be aware of the key risks of an investment fund. A fund may depend on the market rates, which fluctuate in the future. As an investor, you must refer to the risks mentioned in the fund factsheet. The fund factsheet will also have a dedicated section for investment objectives. 

After reading its objectives, one can know whether the fund is the right choice for them. Fund factsheets include investment holdings (sector-wise breakdown), historical fund performance, charges, and other details.

Are you an asset/money management firm failing to draft factsheets? You can always choose Acuity Knowledge Partners for fund factsheet support. Start drafting informative factsheets!

Read Also: 5 Things Private Equity Firms Should Consider Before Outsourcing

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