Mutual Fund Riskometer

Every mutual fund scheme in India must display a Riskometer showing one of six standardized risk levels - Low, Low to Moderate, Moderate, Moderately High, High, and Very High - based on the scheme's actual portfolio holdings and category, not the fund house's own subjective judgment. It's recalculated and disclosed monthly, published on both the fund's own website and AMFI's website within a set number of days after each month closes, so the label reflects genuinely current portfolio composition rather than a one-time label frozen at launch. A 'Low' rating (commonly income or gilt funds) signals materially different risk than a 'Very High' rating (commonly small-cap or sectoral equity funds) - a useful, standardized first check before assuming a fund's category name alone tells you enough about its risk.