Filters to apply before exiting an underperforming mutual fund
You need to compare a fund’s performance with that of the benchmark and peers, besides other factors
Different strategies can have different outcomes on return and work well at different points of time
Investments in actively managed mutual funds meant for the long term may sometimes warrant a second look and even a change. So when do you exit a mutual fund scheme and replace it with another? If the suitability of the scheme in terms of risk given the investor’s need for growth, stability and liquidity is not an issue then the performance of the scheme is typically the primary reason to consider an exit.