Union Flexi Cap Fund – Direct Plan – Growth


Overall analysis 

The 3-yr rolling excess return tracking error against benchmark has been bad overall. All the ratios show that This fund was always negative. Only some time later it came back positive. So, this fund is not good for investment. 

Performance analysis

Rolling return 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.

3 years of the rolling return started with negative return and after August 2018 it started to go up and in June 2020 it was converted into positive. 

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.

Snail Trail Chart shows that this fund was started with negative and turned into positive. 

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 3-6% range considered to be barely active, >6% range considered to be reasonably active and anything higher attributed to concentrated/focused funds. Funds with TE of less than 3% can be considered to be closet indexers.

Tracking error of this fund started with 3.6% and it went down and touched 2.3%. Again, it went up and down. This fund was creating a mountain chart and this fund played between 2.5% to 4%.

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.

Information ratio of this fund was started with negative and in June 2019 it was turned into positive. After that the fund was played between 1 to -1.

Prepared by – <Nisarg Patel>, August 2023


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