Three months is a short enough window that almost any fund will spend some of them behind its peers. A strategy that is out of favour and a strategy that has stopped working look identical over one quarter, and only one of them is a reason to act.
Questions that separate the two
- What was the fund supposed to do? A value fund lagging a momentum-led quarter is behaving as described. Judge it against a benchmark and a peer set that share its mandate.
- Has anything structural changed? A change of mandate, a large change in portfolio character, or a sustained change in how the fund is run is a different matter from a weak three months.
- Is the whole category behind? If every comparable fund is down, you are looking at the market, not at this manager.
- What does the move cost? Exit load, the tax on gains realised by selling, and the days out of the market are all real and all paid on the day you switch.
What a review actually turns on
The holding's role in your plan, your time horizon, and whether the reason you bought it still holds. Those change slowly. Quarterly performance changes quickly, and using the fast-moving thing to make decisions about the slow-moving one is how a portfolio ends up as a list of last year's winners.
If the reasoning has genuinely stopped making sense to you, that is worth a conversation — our portfolio enquiry is the door for it. We do not rate funds or issue buy calls; the useful part is writing down what each holding is for.
Answered by Radiant advisory desk. General information, not personal advice — your own policy wording and circumstances govern.