The riskometer is SEBI's six-level label for how risky a fund's portfolio is, from Low to Very High.
Every mutual fund scheme shows a riskometer on its documents, fact sheets and advertisements. It has six levels:
The level comes from the fund's actual portfolio. For equity funds, SEBI's method looks at the size of the companies held, how much their prices move and how easily they trade. For debt funds, it looks at credit quality, interest rate sensitivity and liquidity.
Fund houses review the riskometer every month and publish any change, so a fund's level can move as its holdings change. Each fund also shows the riskometer of its benchmark, for comparison.
As a rough guide, liquid funds usually sit at Low to Moderate, many debt funds at Low to Moderate or Moderate, hybrid funds in the middle, and most equity funds at Very High.
The riskometer describes the portfolio. It does not say whether a fund suits any particular investor. Volatility and drawdown show how a fund has actually behaved.
Each fund page has its returns, risk, costs, managers and everything it holds.