ISIN INF082J01036
Overall analysis
The 3Y rolling return chart indicates the fund has been generating negative alpha returns for most of the year. TE of the fund shows that it was reasonably active. The IR of the fund shows that the fund wasn’t able to generate risk adjusted returns.
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 3Y rolling return shows that the fund had a good start generating positive returns with 3.7% in Dec 2016. But the fund returns have been deteriorating since then and generated negative returns for most of the years with -7.08% in Jan 2020. The fund tried to beat the benchmark in the year 2021 but could not, and kept generating negative alpha till the end of 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.
The snail trail chart of the fund rolling excess risk/return shows that the fund performed good in the start but later the fund couldn’t perform very well which ended up being in the bottom left quartile with negative returns and negative risk, the fund can be seen a lot in the under performance section.
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.
TE of the fund has been moderately active since the start with TE ranging upto 8.15%. The fund seems to be well managed and 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 IR of the fund was ideal in the start, although since the year 2016, the IR of the fund has constantly been below the minimum benchmark and it wasn’t able to go above 0-1%. This indicates that the fund wasn’t doing better than the expected benchmark.
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’s performance is different from the category average. The centroid of the fund is in the large blend section. The ownership zone of the fund is compact than its category average, the investments are majorly in large blend stocks, some investments can be seen in the large-value and large-growth stocks.
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 style of the fund is closer to the blend, yield being lower than its historical range.
The asset growth can be seen as the momentum is quite above the category average. The quality of the fund is low but slightly above the category average indicating the fund’s profitability. Volatility of the fund is extremely low than its historical range, as well the liquidity. The market capitalization of the fund is closer to mid and large cap above its category average.
Prepared by – Ayushi Shervegar, August 2023
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