Objective

This document outlines the structured, documented, and repeatable process followed by Sanwariya Investments Private Limited (ARN-315267) for identifying, evaluating, and shortlisting mutual fund schemes for client distribution. Our selection process is based entirely on objective analysis, risk-category mapping, and compliance requirements. Scheme selection is never driven by commission incentives.

Fund Selection Process Flow

Our fund selection follows this step-by-step process:

Step Action Details
Step 1 Identify Investment Category Based on client’s goal, investment horizon, and assessed risk profile, identify the suitable MF category (Large Cap, Mid Cap, Small Cap, Flexi Cap, Hybrid, Debt, ELSS, Index, etc.).
Step 2 AMC Screening Evaluate AMC reputation, total AUM size, regulatory track record (no SEBI action), fund management team stability, and operational efficiency.
Step 3 Performance Analysis Compare rolling returns across 1-year, 3-year, and 5-year periods against the scheme’s benchmark index and category average. Avoid relying only on point-to-point returns.
Step 4 Risk-Adjusted Return Analysis Evaluate Sharpe Ratio (return per unit of risk), Sortino Ratio (downside risk), Standard Deviation, and Maximum Drawdown to assess risk-reward balance.
Step 5 Expense Ratio Comparison Compare expense ratios within the peer category. Lower expense ratio is preferred as it has a significant impact on long-term wealth creation.
Step 6 Fund Manager Review Assess fund manager’s tenure with the scheme, track record across market cycles, and investment style consistency. Flag schemes with more than 2 fund manager changes in 3 years.
Step 7 Portfolio Quality Check For equity funds: check sector concentration, single-stock exposure, and market-cap allocation. For debt funds: check credit quality (minimum AA-), maturity profile, and concentration risk.
Step 8 SEBI Riskometer Mapping Map each shortlisted scheme to its SEBI Riskometer category (Low to Very High) and match to client risk profiles (Conservative / Moderate / Aggressive).
Step 9 Approval Final recommended scheme list reviewed and approved before being used for client distribution. No scheme is recommended without sign-off.
Step 10 Yearly Review Recommended list reviewed every year. Underperforming schemes replaced based on the same objective criteria. Ad-hoc reviews triggered by major market events or regulatory changes.

Exclusion Criteria

  • Schemes from AMCs under SEBI regulatory action or warning
  • Schemes with high portfolio concentration in a single stock or sector beyond category norms
  • Debt schemes with significant exposure to below-investment-grade (below AA-) securities
  • Schemes with more than 2 fund manager changes in the last 3 years
  • Close-ended or interval schemes unless specifically required for a client’s goal
  • SIF products with opaque strategy or inadequate risk disclosure

Data Sources

  • AMC factsheets and monthly portfolio disclosures
  • Value Research and Morningstar India for performance data and fund ratings
  • AMFI website for NAV and AUM data
  • SEBI Riskometer classification for risk categorization
  • SEBI Mutual Fund filings portal for SID/SAI/KIM documents

Suitability Mapping

Every shortlisted scheme is mapped to one of three client risk categories: Conservative (score 0-35%), Moderate (score 36-65%), or Aggressive (score 66-100%). No scheme whose SEBI Riskometer category exceeds the client’s assessed risk level is recommended. If a client insists on an unsuitable scheme, the Execution-Only process is followed with written unsuitability communication and client consent as per our SOP.

Suitability Matrix (NFP – Need-based Fund Planning)

Client Risk Profile Short Term (< 3 Years) Medium Term (3–7 Years) Long Term (> 7 Years)
Conservative (0-35%)
Cautious Investor		 Liquid Funds, Overnight, Ultra Short Duration, Money Market, Arbitrage
Equity: 0-10% Debt: 90-100%		 Short Duration, Banking & PSU, Corporate Bond, Conservative Hybrid, Equity Savings
Equity: 10-25% Debt: 75-90%		 Conservative Hybrid, Balanced Hybrid (limited), Large Cap (up to 15%), Gilt, Target Maturity
Equity: 15-30% Debt: 70-85%
Moderate (36-65%)
Balanced Investor		 Ultra Short Duration, Conservative Hybrid, Equity Savings
Equity: 15-30% Debt: 70-85%		 Balanced Hybrid, Aggressive Hybrid, Multi Cap, Large & Mid Cap
Equity: 40-60% Debt: 40-60%		 Flexi Cap, Multi Cap, Large & Mid Cap, ELSS, Value/Contra
Equity: 60-75% Debt: 25-40%
Aggressive (66-100%)
Growth Investor		 Equity Savings, Aggressive Hybrid, Dynamic Asset Allocation
Equity: 25-40% Debt: 60-75%		 Flexi Cap, Mid Cap, Large & Mid Cap, Focused Fund
Equity: 60-80% Debt: 20-40%		 Mid Cap, Small Cap, Sectoral, Thematic, International
Equity: 75-100% Debt: 0-25%

Unsuitability Declaration

If a client insists on investing in a scheme that exceeds their risk profile ceiling, a written Unsuitability Declaration is obtained. This declaration clearly states that:

  • The investor has been informed that the chosen scheme does not match their assessed risk profile
  • The distributor does not recommend this particular investment
  • The investor is proceeding at their own risk and volition against the distributor’s recommendation

The declaration is signed by the investor and maintained in records as per AMFI DDQ requirements.

Conflict of Interest Declaration

  • We do not have any proprietary relationship with any AMC
  • Our fund recommendations are not influenced by commission structures
  • We maintain a documented fund selection process that is auditable
  • Commission disclosure is made to every investor at the time of investment

Sanwariya Investments Private Limited

AMFI Registered Mutual Fund Distributor & SIF Distributor (ARN-315267)

CIN: U64990RJ2024PTC096132

MF Distribution Validity: 04/12/2024 to 03/12/2027 | SIF Distribution Validity: 08/10/2025 to 07/10/2028

Disclaimers

Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements before choosing a fund, or designing a portfolio that suits your needs.

Investments in Specialized Investment Fund involves relatively higher risk including potential loss of capital, liquidity risk and market volatility. Please read all investment strategy related documents carefully before making the investment decision.

The Company receives commission from Asset Management Companies / issuers for distribution of Mutual Fund and SIF products in Regular Plans, as permitted under SEBI and AMFI regulations. Such commissions may include trail or other permitted forms. No commission or fee is charged directly to investors for Mutual Fund or SIF distribution.

Sanwariya Investments Private Limited makes no warranties or representations, express or implied, on products offered through the platform of Sanwariya Investments Private Limited or the Niveshum mobile application. We provide incidental advisory services only. For investment advice, please consult a SEBI-registered Investment Adviser. It accepts no liability for any damages or losses, however caused, in connection with the use of, or on the reliance of its product or related services.

Sanwariya Investments Private Limited operates in compliance with SEBI and AMFI regulations.