INF955L01AG0
Overall analysis (h2)
3-yr rolling excess returns of the fund is volatile enough. Overall, this fund has high TE, currently it is moderately active. The fund gave decent returns in comparison to its peers and now it is generating returns equal to the upper quartile. In June 2023 the fund took more risk and generated less returns.
Performance analysis (h2)
Rolling returns – 3 years rolling excess returns over 7 years
Snail trail – 3 years rolling excess risk/return over 7 years
Tracking error – 1 year rolling tracking error over 7 years
Information ratio – 1 year rolling information ratio over 7 years
Rolling returns in quartiles
The rolling return chart shows excess 1Y-year rolling return 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 fund’s returns are pretty volatile, but it has quite decent returns against its peers. This fund’s returns were negative most of the time in its past stages, initially the fund is performing well by outperforming the median line and approaching upper quartile, generating excess 4.35% returns, impressive part is- it gave positive returns during pandemic.
Rolling risk/return (Snail-trail)
The rolling risk/return chart shows excess 1-year annualized returns relative to the index. The top left quadrant would indicate higher returns with lower volatility than index.
The 3 year rolling excess risk/return chart shows that the fund started giving negative returns in past by taking negative risk, after it overcame the negative returns & generated the highest 3 year rolling return of 4.35% against its benchmark index, currently it is generating excess 0.27% against its benchmark taking the positive risk of 0.42%. As mentioned earlier this fund is quite volatile.
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 1-3% range considered to be low TE, 3-6% range considered to be moderately active and anything higher than 6% is high TE. Funds with TE of less than 2% can be considered to be closet indexers.
The 1 year rolling tracking error chart shows that the fund has the highest 1 year rolling tracking error of 9.6%, this states that the fund is highly active, Current TE stands at 3.81%, as of now it is moderately 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.
As per 1 year rolling information ratio chart, it started with negative IR of (-1.2), touched the high of (1.7) which concludes that the fund delivered risk adjusted performance.
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.
Centroid indicator of this fund stands at large cap- growth stocks & ownership zone states that the portfolio has its picks around mid & small cap also,the stocks are growth & blended ones. Other multi-cap fund indicators have their tracks around this funds indicator & sometimes there have been thorough value oriented stocks also, but this fund didn’t go through adding value stocks into its portfolio.
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 Momentum & quality is high & good, momentum is highly active & movement is drastic from low to high, Quality of stocks has also been improved & moving towards high; as shown by 5 years historical change indicator. Volatility & Liquidity of the portfolio stocks is low, Size of the portfolio is small as compared to its category average.
Prepared by – Hemanth Reddy, August 2023
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