Many funds are sitting on illiquid stocks

Careful stock selection, rather than right entry into a stock and exit is the most important aspect of investing. But fund managers have to keep in mind another aspect: liquidity. That is why they try to avoid small companies. In fact, large foreign funds may avoid even a country because they cannot buy and sell a stock in large enough volumes for...

Is mutual fund performance driven by skilful stock picking or solely by the market direction?

Fund houses and their managers claim special expertise in stock-picking skills and various strategies of portfolio construction that they apply to earn market-beating returns. Unfortunately, this is merely an ideal. Most funds cannot achieve market-beating results consistently. The majority of funds...

Sector funds are supposed to focus on a single sector. But to create performance, they diffuse their focus

The primary objective of most fund companies is amassing more and more assets through an ever-lengthening list of fund ideas. One such idea is sector fund. Sector funds invest entirely or mainly in a single sector. Sectors that are hot for a stretch of time immediately attract a fund....