On what basis mutual fund schemes should be selected?

While selecting mutual fund schemes,basic thing to consider is one's investment horizon, objective and
risk profile. If investor has risk appetite and horizon is long term (minimum three years),then equity schemes can be considered but investor is risk averse or investing only for few months,then short term income funds can be a better option.

To select a specific scheme from a particular type of fund, its performance can be compared against its
benchmark as well as category average, consistency of return, long performance record and quality and
image of the fund management team as well as fund house can also be considered.