CRISIL

About the firm

Business Model

The firm does not charge for its quantitative ratings (CRISIL mutual funds rankings). It does not appear to make money from advertising either. However, its qualitative research is available only part of paid consulting assignments with private wealth management and other institutional investors.

Investment philosophy

CRISIL mutual fund ranking (CMFR) is a relative ranking of open ended funds with its peer group and covers equity, debt and hybrid asset classes. Ranking is based on the following parameters: mean return of NAV, active return (return in excess of CRISIL- AMFI performance indices), portfolio concentration risk which measure the risk of improper diversification, exposure to sensitive sectors based on credit risk associated with an industry , liquidity analysis which measure how quickly a portfolio can be liquidated, asset quality measures the probability of default by the issuer of debt security, modified duration is used to measure the interest rate risk and tracking error measures variability in fund’s performance with regards to the index it tracks.

The ranks are assigned on a scale of 1 to 5, with CRISIL Fund Rank 1 indicating ‘very good performance’. In any peer group, the top 10 percentile of funds are ranked as CRISIL Fund Rank 1 and the next 20 percentile as CRISIL Fund Rank 2. 

Media

MMI interview with Piyush Gupta, 2022

Yet to write summary

The mutual fund show- CRISIL Rankings, BloombergQuint, 2019

Bhushan Kedar explains how the funds are ranked for April – June quarter. Ranking is  based on the fund’s relative performance in that particular quarter which ultimately depends on the performance of the underlying holding company. 

Prepared by – Vanshika Bagrecha, June 2020