How do you select the mutual fund schemes you recommend?

In a word, scientifically. Our 2018 recommendations are available at https://www.clearfunds.com/best-mutual-funds-2018


Our goal is to identify funds that are able to deliver sustainable performance across economic cycles and different market conditions. So we set out to design a data-driven predictive model that optimizes the 2-year returns on Equity Funds with minimal volatility. We started with the entire universe of mutual funds and applied a number of filters:

  • We selected only growth options, which are best suited from a tax perspective.
  • We limited our analysis to only diversified equity mutual funds — a mix of Large Cap, Flexi Cap and Mid & Small Cap funds helps investors achieve the required sector diversification, and avoids the volatility that comes with holding sector-specific funds.
  • We then eliminated funds which have been in existence for less than 3 years — we need a track record that the fund can be judged on.
  • To make sure that you can redeem your investments with minimal price impact when needed, we set the minimum size cut-off to Rs 500 crore for Large Cap funds and Rs 150 crore for all other funds.
  • Finally, while we will only recommend direct plans (see why), our analysis is on the regular plans as they have a longer history of data for our algorithm to run on.

Now for the hard work…
We collected all the possible data for these funds and threw this into a big-data statistical computing environment with one goal — to identify the factors that would determine 2-year performance. Our statistical model generated 30 possible factors resulting in more than a million data points.
After several iterations over several weeks (which turned into months), and innumerable cups of black coffee analysing longitudinal trends within the data, we were able to identify a number of factors that would predict 2-year outperformance. We recomputed these factors every two weeks going back in time to the inception of each fund, and back-tested this again, to ensure that the factors work across market cycles. The result is a sophisticated scoring algorithm that enables us to continuously identify optimal funds.

Does your selection methodology guarantee returns?

Our scientific fund selection process aims to identify funds that have the best chance of outperforming their peers but we cannot guarantee returns. To learn about how we select our recommended funds, see : Equity Recommendations 2018
                                                             Debt Recommendations 2018

It’s probably time to remind you of the SEBI Caution: “Mutual Fund investments are subject to market risk; please read all offer documents carefully.”

What is in your current list of recommended funds?

We’ve selected variety of funds in different categories to help you meet your investment goals. Our Equity Fund recommendations for 2018 are across four categories: 


Equity Large Cap: Large cap diversified funds should form the core of your investment holdings.


Equity Flexi Cap or Multi Cap: These funds are not biased towards either large- or mid-cap stocks but select stocks in their portfolio wherever they see investment opportunities.

Equity Small & Mid-Cap: Small and mid-cap focussed funds are more volatile, but can often help boost overall returns of your portfolio. These are suitable for investors who have the ability to take on higher risk of losses.


Tax Saving Equity Funds (ELSS): In order to reduce your tax bill, you can invest up to Rs 150,000 a year in Tax Saving (ELSS) funds under section 80C of the Income-tax Act.


Can I decide the amount to be invested in each of your recommended mutual fund schemes?

Of course. While we recommend funds for you to invest in, we’ve made Clearfunds totally flexible so that

  • You can decide what you want to invest in
  • You can decide when you want to invest
  • You can decide when you want to sell your investment.

It really is that simple.

Can I invest in funds other than the ones you’ve recommended or shortlisted?

Of course. While we scientifically screen, shortlist and monitor the funds on our Clearfunds Recommended List, we’re not arrogant enough to believe that our list is the only list possible. 

We offer funds from the widest range of Mutual Fund Companies (always being updated) and allow you to buy virtually any Mutual Fund in India.

What happens when you change your recommended fund list?

We drop you an email when we (infrequently) change our recommended funds list asking you to log in to your Clearfunds account.

You can then choose to continue investing in the old funds or switch to the new funds. We make sure that all switches are tax-efficient. And when you decide to switch you can do this with just one click.

What happens to investments I’ve made in a fund that's no longer recommended?

The money will stay invested in the fund until you choose to withdraw it.

Contact us

Clearfunds / Harvest Fintech Pvt Ltd
206 Natwar Chambers,
94 Nagindas Master Road, Fort,
Mumbai 400001, India.

+91 90225-22555 (Weekdays 10AM-6PM)

help@clearfunds.com

Media queries: media@clearfunds.com

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