ISIN INF846K01K35
Overall analysis
3-yr rolling excess returns touched 19.6% in April 2020 but the funds’ performance in the short run has been deteriorating. The fund had not given excess return in comparison to its peers. The TE ranges above 6% and also it has touched 14% in June 2020, which indicates active fund. The snail trail chart shows that the funds have given higher returns with high risk.
Performance analysis
Rolling returns in quartiles
The rolling return chart shows excess 3-year annualised returns in context of peer return quartiles. The blue line’s time above the third green median line indicates the fund’s better than median performance.
The chart shows that in April, 2020 the excess return was 18.61% which is above the third green median line but later it started declining and it went to 0.72% in June, 2023, which clearly indicates that the fund is not performing better than median performance over the last 3 years.
Rolling risk/return (Snail-trail)
The rolling risk/return chart shows excess 3-year annualised returns relative to the index. The top left quadrant would indicate higher returns with lower volatility than index.
This fund has shown impressive 3-year excess returns, touching 18.61% per annum and a significant time around the 2-6% per annum, whilst lower than index volatility of 1-4% per annum. However, the excess return came down to around -2.11% towards the end of May, 2023.
Tracking error
The tracking error chart shows how the fund ‘tracks’ against the index. The higher the TE, the more active the fund’s return has been, with the 2-4% range considered to be barely active, 4-6% range considered to be reasonably active and anything higher attributed to concentrated/focused funds. Funds with TE of less than 2% can be considered to be closet indexers.
The tracking error chart of the fund was good at the start which was 9.59% and later it went up by 13.92% in June 2023. But gradually it started coming down and in June, 2023 it was 5.21%. Fund is considered to be reasonably active.
Information ratio
The information ratio is a measure of ‘risk-adjusted return’ as it’s the excess return per unit of excess volatility. Active funds should have IR of higher than 1, ideally higher than 1.3 at least to indicate skill.
The information ratio of the fund went up to 3.46% in March, 2020 but it has come down to -0.21% in June, 2023. However, the fund’s significant time around 0-2%, means it is ideal.
Portfolio analysis
Stock style chart
Morningstar’s stock style chart shows the ‘style’ of the stocks in the portfolio in terms of size and value/growth style. The centroid shows the weighted average while the zone circle shows how varied the stock styles are.
The stock style chart shows that the fund is typically a Mid cap growth fund.
Factor profile chart
Morningstar’s factor profile shows the historical style analysis of the stocks in the portfolio in terms of size, value/growth style and other key factors. The blue circle shows the fund relative to the black dot for the category average.
The factor profile chart shows that the fund’s growth oriented and yield factor is very low, momentum and quality factors are high compared to 5 yrs historical range but volatility and liquidity is moderately low.
Prepared by – Dhruvi Shah, August 2023
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