What should you do when youre fund manager leaves

There are various ways in which you select a mutual fund scheme for investment. One of most popular is going for a fund that is being managed by a star fund manager. What if, after your investment he stops managing that fund for some reasons? The simple reason is to get rid of the fund, however, before doing that answers these four questions.

The tax incidence: Check the amount of tax you need to pay in case you are selling your fund now. In India you need to pay either short term of long term tax depending upon the period of holding. Therefore, you need to analyse the tax you will have to pay if you exit from the fund.  In case you do not have to pay any tax you can exit the fund.

Will the fund strategy change: If the new fund manager has changed the strategy of managing fund, the fund may no longer play the same role in your portfolio that you bought it to fulfil. This is a valid reason for you to sell the fund. Even in case it has not been explicitly expressed, you need to increase the frequency of monitoring the fund so as to know that your fund is following the expected strategy.

Check the track record of new fund manager: The fund houses will definitely appoint someone who has better track record of managing funds or a high profile analyst. Get the detail of new fund manager and check the performance and style of the fund that he has managed. If it suits to your portfolio, you can continue with the fund.