ISIN INF663L01GR4
Overall analysis
3-yr rolling excess returns has been in the range of 4-6%.Tracking error against benchmark have been in the 2-6% range overall; but the funds’ performance in the short run has been deteriorating. The fund had given a neutral excess return in comparison to its peers; but has gone up in the first quartile over the past 1 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 shows that in June 2016 above the third green median line but then it has been neutral with the median line which means the fund is performing as the median 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 shown good 3-year excess returns, touching 4.07% per annum and a significant time around the -3-2% pa, whilst lower than index volatility of 2-3% pa. However, the excess return came down to around -3.38% February 2019.
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 of the fund shows that in June 2016 was 2% but then came down to 1% which is not good and again went up to 2-4% and now it is 3.6% in June 2023 which is barely 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 was less than 1 in June 2016 and then went down negative which is not good for the fund but then went up to 2.5 which is good for the fund and now in June 2023 1 which 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 style chart shows that the fund is typically growth oriented in a large cap segment.
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 yield is low ,momentum is high,quality is moderate, volatility & liquidity is low and the size is large as compared to the last 5 yr historical range.
Prepared by – Shreyas Walve, August 2023
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