ISIN INF194KB1AL4
Overall analysis
3-yr rolling excess returns against benchmark have not given high returns.the TE range is between 4-6% but it is deteriorating. The fund performance in the short run has also been deteriorating. The fund has not given a high excess return in comparison to its peers, but has performed well over the past 1 year compared to past years.
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 fund never crossed the third green median line indicates the fund is not better than median performance. The third green median line was 3.37% in June 2023, and the blue line’s -2.00% in June 2023.
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 not shown an impressive 3-year excess return, it is touching -2.00% per annum. However, the excess return came up to around -2.00%, June 2023 from -5.38, 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 shows a good start which was 10.45% in May 2021, but later it has come down to 4.33% in June,2023, The fund range is reasonably active and it is above index performance.
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 was low in March, 2021 which is -2.93 and went up to 0.48in August, 2021. Later in April, 2023 it went up to 0.54% and came down to 0.64% in June, 2023. The fund has always performed less than 1 and it is not a good indication.
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 a blend of mid cap, small cap and large cap growth funds.
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 style is growth, yield is low compared to 5 years historical range, momentum factor has shown a wide range but the fund is below category average, volatility is moderate, liquidity is low.
Prepared by – Dhruvi Shah, August 2023
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