Three reads before you clap for a factsheet.
01
The index on TV is a price chart, not an investment return. Owning the 50 stocks pays you dividends the chart never shows. Add roughly 1.3 points a year back before you compare anything to it.
02
Find the benchmark name on the factsheet and look for three letters. TRI. If those letters are missing, or the proud ten-year chart starts before Feb 2018, about 1.3 points of the alpha was never alpha. It was the benchmark forgetting its own dividends.
03
Small print compounds. 1.3 points a year is Rs 3.80L on Rs 10L in ten years, and about Rs 25L in twenty. The quietest line on a factsheet is usually the one moving the most money.
An index fund earns the dividends. A price chart forgets them. When a brochure beats the chart, ask which Nifty it beat. The honest bar has three extra letters.