What is YTD (YeartoDate) in Mutual Funds?

When investing in mutual funds, it’s important to track how your investments perform over time. This can help you understand the fund's performance over time and assess if it aligns with your financial goals. One metric that can help you do this is YTD (full form is Year-to-Date). It makes it easier to review your portfolio mid-year or even compare funds in a volatile market without relying solely on long-term data.

In this article, we’ll explore what is YTD in mutual funds, its measures, and how you can calculate it.

What is YTD in mutual funds?

YTD in mutual funds measures how much the fund’s Net Asset Value (NAV) has changed since January 1 of the current calendar year. It gives you a real-time update of the fund's performance for the current year, making it easier to review its behaviour during market ups and downs.

Unlike 1-year or 3-year returns, which reflect long-term performance, YTD helps evaluate how a fund is responding to current market conditions. It is particularly useful for short-term analysis, like comparing similar funds within the same category or tracking how a fund is responding to policy changes.

Why does YTD matter?

Now that you know what is mutual fund YTD, let's understand why it matters:

1. Real-time performance indicator

YTD offers a quick snapshot of how well a mutual fund is performing from the start of the year to today.

2. Reflects market sentiment

Changes in YTD returns often reflect bigger market movements. For instance, a rise or fall could be due to policy changes, global events, or economic shifts that affect the fund’s NAV during the year.

3. Decision-making tool

It helps investors decide whether to continue SIPs, top up their investments, or switch to better-performing funds based on YTD trends.  

Different measures of YTD

There are three key measures of YTD:

• Year-to-date return: This is the most common way to check the profits you've earned from a mutual fund from January 1 to today.
• Year-to-date earnings: This measure helps you calculate the money you've earned from the fund so far after subtracting the expenses from the revenue.
• Year-to-date net pay: This is your take-home income after subtracting taxes, charges, and any other deductions.

How to calculate YTD?

You can calculate YTD return using this formula:

YTD Return = [(Current value – initial value) / initial value] × 100

For example, say the current value of your mutual fund is Rs. 180. On January 1, the value was Rs. 120. In this scenario, your YTD return would be:

[(180 - 120) / 120] x 100 = 50%

This means your investment has increased by 50% since the beginning of the year. A positive YTD return indicates growth in your investment, while a negative return would suggest a loss.

Conclusion

Whether you're a beginner or a seasoned investor, YTD is a handy tool to get a quick snapshot of your investment portfolio. It helps you understand how your mutual fund has performed this year, making it easier to decide whether to invest more, stay invested, or switch funds.

Start investing in mutual funds and track their performance with ease with Tata Capital Moneyfy. Visit the official website or download the mobile app today.