ISIN INF761K01EP7
Overall analysis
3-yr rolling excess returns is above the first quartile and TE of the fund is active but it has declined after June 2021l; the funds’ performance in the short run has been deteriorating. The fund had given a high excess return in comparison to its peers; but has dropped to below the first quartile over the past one year.
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 rolling return chart shows that the blue line is above upper quartile and third green median line. The fund returns are above 10% till January 2023 and then gradually it came down to 5.84% in June 2023, overall, the fund has performed better in comparison to peers.
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 15% per annum and a significant time around the 10-15% pa, whilst higher than index volatility of 2-4% pa. However, the excess return came down to around 5% towards the end of June 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 shows that the fund is reasonably active as it ranges above 6%. The fund was 16.28% in December 2020 which is an all time high.
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 indicated an ideal fund at start as it was more than 1 and in April 2020 it was 2.8 in December 2020 but later IR gradually started decreasing and currently it is around 0.2 which indicates that the fund is not 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 growth oriented funds and the yield is very low compared to 5 years historical range and category average and the momentum has shown a wide range in 5 historical range. Volatility and liquidity has also shown wide range and quality is also high.
Prepared by – Dhruvi Shah, August 2023
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