Riskometer

The riskometer is the SEBI-mandated dial on every mutual fund scheme document that shows how risky the scheme is, on six levels from Low to Very High. Each Asset Management Company recalculates it monthly from the scheme's actual holdings and publishes any change, so it reflects what the scheme owns now rather than what its name suggests. Use it as a first filter, not a verdict: two schemes marked Very High can behave very differently. It describes the risk taken, and says nothing about the return that risk might produce.