How to Build a Mutual Fund Screen for Hybrid Aggressive Funds

Example 2: How to Build a Mutual Fund Screen for a Hybrid-Aggressive Fund

Some investors have an aggressive style of investing. Let’s see how we can build such a screen. (You may choose different filters based on your preferences.)

We will start by selecting the category of funds first. Once we choose the Hybrid-Aggressive category from our MF category, we are left with these funds.

One of the biggest factors in choosing an aggressive fund is the fund manager. Since there’s a high-risk, high-reward scenario here, finding a reliable fund manager is important.

One metric that can help determine this is finding funds that have consistently performed well. And we do that by selecting the performance consistency. We select the top 30% of funds like this:

We are left with 21 funds now.

Next, we want funds that offer good risk-adjusted returns. We will select the Sharpe ratio and filter out the top 30% of funds in it.

With 7 mutual funds left in our category, we finally want funds that are reliable and hence we will select AUM and filter out the top 30% in it.

There you go. We now have our list of aggressive mutual funds that have consistently delivered good risk-adjusted returns and have a certain level of standing in that category.

Let’s now move on to our final example.