SEBON Mutual Fund & SIP Selection Checklist

Rule of Thumb: In Nepal, open-ended mutual funds offer Systematic Investment Plans (SIP) with zero broker commission and auto-debit through ConnectIPS or bank mandate. Look for Expense Ratio < 1.5% and 3-year consistency over NEPSE benchmark.

1 Fund House & Sponsor Verification

SEBON License & BFI Sponsor Standing

Verify that the Fund Manager is a subsidiary of a Class 'A' Commercial Bank (e.g., NIBL Ace, Siddhartha Capital, Nabil Invest, Sanima Capital) licensed by SEBON.

AUM (Assets Under Management) Size

Target schemes with over NPR 50 Crores in AUM. Larger funds offer superior diversification and liquidity for redeeming units.

2 Cost & Fee Structure Audit

Management & Depository Fees

Check the latest monthly fact sheet. Combined management, depository, and supervisor fees must not exceed SEBON caps (max 1.5% annually).

Exit Load Policy

Understand exit fees: Most open-ended funds charge 1.5% if redeemed within 1 year, 1.0% in year 2, and 0% after 2 years. Align with your investment horizon.

3 Performance & Portfolio Composition

NAV vs NEPSE Index Performance

Compare the fund's Net Asset Value (NAV) growth against NEPSE over 1-year, 2-year, and 3-year cycles. Did it preserve capital during bear trends?

Asset Allocation Breakdown

Review the top 10 portfolio holdings. Ideal balance for moderate risk: 60-70% Listed Equities, 15-20% Fixed Deposits / Debentures, 10-15% Cash/Short-term reserves.

4 SIP Setup & Execution

Dividend Re-Investment Plan (DREP)

Opt into DREP. Instead of cash dividends credited to your bank account, dividends are automatically used to purchase additional units at NAV, compounding your wealth.

Auto-Debit Date Alignment

Set your monthly SIP deduction date between the 3rd and 7th of the Nepali calendar month, immediately following salary disbursement.

Mutual Fund & SIP Evaluation Checklist

SEBON License & BFI Sponsor Standing

AUM (Assets Under Management) Size

Management & Depository Fees

Exit Load Policy

NAV vs NEPSE Index Performance

Asset Allocation Breakdown

Dividend Re-Investment Plan (DREP)

Auto-Debit Date Alignment