Compare funds correctly
Whether you are a professional or private investor, investment decisions should be made on the basis of objective information that you actually understand. The independent nature of the data as well as the transparency of the ranking therefore take priority.
What key figures and fund data can you compare?
In addition to performance and volatility (value fluctuation), there are still other key figures that you can compare. These include the subscription fee, the fund volume and the use of income. The investment focus more precisely specifies the funds in which investments are made. These include the fund type (e.g. stock funds or pension funds) and specific regions, topics or sectors. Example of investment focuses include Europe all cap stock funds, global real estate funds or dynamic emerging markets mixed funds.
Even if you are already invested in funds, a comparison is worth your time. In the fund comparison you can discover the top performers in various asset classes, investment regions or topics or evaluate the performance of your fund in comparison to its peer group.
Compare the performance across different periods
When comparing the performance of different investment funds, always take a look at multiple periods and pay attention to how the products performed in times of crisis. For full transparency, you should be able to switch between various periods (e.g. 1 year, 3 years and 5 years) in every fund comparison.
Factor your risk tolerance into the fund comparison
When the expected returns of investment funds rise, normally so does their risk. You should therefore absolutely factor your personal risk tolerance into the comparison. Multiple key figures in the fund comparison say something about risk. While the volatility reflects the fluctuation ('How much does the value of my fund fluctuate?'), the Sharpe ratio relates this to the returns ('Is the risk worth it?') Another risk indicator is the SRRI (synthetic risk and reward indicator), which classifies the risk on a scale from 1-7 and is required by law The value is based on the volatility of the last five years. A value of 1 indicates a low risk, while a value of 7 indicates a high risk.