Choice Mutual Fund has introduced its first actively managed equity scheme, expanding its presence in India’s mutual fund market. The new offering gives investors another option in the actively managed equity category, where fund managers select investments based on their assessment of companies and market conditions.
What Is an Actively Managed Equity Fund?
An actively managed equity fund invests primarily in shares selected by its fund management team. Unlike a passive index fund, which generally tracks a market index, an active fund aims to make investment decisions based on research and the scheme’s stated objectives.
The fund’s performance depends on factors such as stock selection, market movements, portfolio allocation and investment costs.
What Investors Should Check
Before investing in a newly launched mutual fund, investors should review its investment objective, benchmark, expense ratio, risk level and scheme documents. A new fund does not have a long performance history of its own, making it important to understand its strategy rather than relying on expected returns.
Mutual funds carry market risk, and neither active management nor a new launch guarantees better performance than existing schemes.
