Not a consistent performer

If your scheme is consistently under performing the Nifty or the Sensex, it's time to sell the scheme. If for example, the Nifty has rallied 10 per cent in the last one year and your scheme has shown a negative performance of 5 per cent, you are going nowhere. If this has been happening for the last 2-3 years, it's time to move on.

Fund manager crucial to performance

If your scheme has been performing well and beating the benchmark indices in terms of returns, than you should be happy. However, if the fund manager is set to leave or manage another fund, you might want to switchover or sell your scheme.

Fine tuning your portfolio

If your mutual fund scheme is a debt oriented one and interest rates are likely headed lower, you might want to move to a equity scheme. Moreover, if you feel that the stock markets are headed higher, you might want to re-balance your portfolio and move from debt to equity schemes.

Check your own piorities

You have to check your own needs. For example, if you had invested in a equity scheme around 10 years back and have now retired since, you may not have penchant for risk. Hence, it would be advisable to move your scheme from equity to debt.

Sell only if there is a real need

Mutual fund schemes always generate healthy returns over a longer period of time. When it becomes imperative to meet your own personal needs like a sudden emergency, you might want to sell the scheme.