Objective

A structured, transparent, and repeatable process for selecting and reviewing Mutual Fund schemes. The methodology follows a Category → AMC → Scheme approach aligned with the investor's risk profile, goals, and investment horizon.

Step 1: Asset Allocation

Based on the investor's risk profile (Conservative to Very Aggressive), an indicative allocation is drawn across Equity, Debt, Hybrid, and Liquid categories. Allocations respect the 6-tier suitability matrix and maximum allocation ceilings.

Step 2: Category Selection

Within each asset class, a SEBI-defined category (for example: Large Cap, Flexi Cap, ELSS, Short Duration, Liquid) is identified based on the investor's goal, tenure, and tax efficiency.

Step 3: AMC Shortlisting

Each AMC is evaluated on: AUM stability, investment team tenure, process consistency, regulatory track record, and operational reliability (transaction / service SLAs).

Step 4: Scheme Evaluation

Quantitative filters: Rolling returns (3-year / 5-year), Sharpe and Sortino ratios, Alpha vs benchmark, standard deviation, maximum drawdown, and BER (Base Expense Ratio) impact.

Qualitative filters: Fund manager tenure, portfolio concentration, style drift risk, exit load structure, and alignment with the mandate.

Step 5: Suitability Check

The shortlisted scheme is mapped against the investor's 6-tier risk ceiling. No scheme above the investor's risk ceiling is recommended. If the investor insists on such a scheme, the execution-only protocol applies (see below).

Step 6: Recommendation Communication

A written recommendation (letter or email) is shared covering: scheme name, category, rationale, risk level, indicative holding period, and suitability mapping. The investor is encouraged to read SID / SAI / KIM before signing off.

Step 7: Execution

Transactions are executed on the BSE STAR MF platform with EUIN E032901 tagged on every transaction. Consents are captured in writing or via the platform. Records are maintained in backoffice for a minimum of 8 years.

Portfolio Review

• Annual portfolio review with the investor (minimum); on-request reviews available.
• Re-balancing triggered by: significant market changes, goal progress, life events (marriage, child, retirement, home purchase), or tax-year planning.
• Scheme-level monitoring for: sustained underperformance vs benchmark (4+ consecutive quarters), fund manager change, AUM decline greater than 20%, or style drift.
• Maximum assumed CAGR in projections: 12% p.a. per AMFI Best Practice Guidelines (Future Return Assumptions).

Execution-Only Protocol

If an investor insists on investing in a scheme above their risk ceiling, the following protocol applies: (1) a written Unsuitability Declaration is issued to the investor; (2) the investor signs an Execution-Only Consent acknowledging the unsuitability and accepting full responsibility; (3) the transaction is tagged "Execution Only" in the register. This is aligned with SEBI Master Circular 15.5.1.4(b) and AMFI DDQ requirements.