The Riskometer is a scheme-level indicator of assessed risk. It can help you notice risk before investing, but it does not predict returns or tell you whether a scheme is suitable for your personal situation.

What the Riskometer shows

SEBI’s investor education material describes the Riskometer as a tool that depicts a mutual fund scheme’s risk level. The scale ranges from Low through Low to Moderate, Moderate, Moderately High and High to Very High. The exact label for a scheme should be checked in its current documents and disclosures.

Think of the label as a starting point for questions: What kinds of assets does the scheme hold? How concentrated is the portfolio? How might credit, interest-rate, liquidity, currency or market movements affect it? What is the intended investment horizon?

What it does not tell you

A Riskometer is not a return forecast, a guarantee against loss, a ranking of funds, or a complete summary of every risk. A “Low” label does not mean risk-free. A scheme’s risk profile and label can change as its portfolio and market conditions change. Past performance is not a reliable guide to future results.

Do not compare schemes using the Riskometer alone. Read the scheme objective, asset allocation, benchmark, costs, exit load, portfolio and the date of the disclosure. Check that you are looking at the same scheme, plan and option.

Read it with the scheme documents

Use the current Scheme Information Document (SID), Key Information Memorandum (KIM), Statement of Additional Information (SAI), applicable addenda and factsheet. The SID describes the scheme’s investment objective, strategy, risks and terms. The KIM is a shorter summary; it does not replace the SID. Documents are published by the relevant AMC and may be available through official filings.

Then ask whether the scheme’s risk, liquidity and time horizon are consistent with your own objectives and ability to bear losses. If you are unsure, seek help from an appropriately qualified professional. A distributor’s explanation does not remove your responsibility to understand the product and authorize your own transactions.

Remember

The Riskometer helps communicate scheme risk. It does not certify suitability, remove uncertainty or assure a particular outcome.

Related resources

Educational information only. It does not consider your individual circumstances, recommend a particular mutual fund scheme or assure returns. Mutual fund investments are subject to market risks; read all scheme-related documents carefully.

For any transaction, verify the current scheme, plan, option, costs, authorization and receiving channel. Do not share passwords, OTPs, PAN or Aadhaar through this site.