There are 3 Broad Factors Used for Evaluation

• Performance: Past performance of the Fund is compared against the benchmark and peers with emphasis on consistency of returns rather so that recent periods do not unduly influence the overall rating
• Risk: Risk measures of the fund are compared with benchmark and peers over the period. Fund’s ability to generate return per unit of risk taken is measured along with liquidity and portfolio concentration measures
• Portfolio Strength: Strength of the portfolio by rating the underlying constituents and comparing it across the peer funds

Factor Weight: We run multiple combinations of weights across the factors and measure the performance of each combination in terms of the success rate and performance of funds which qualify for our buckets of Buy, Hold and Sell using monthly rating update Parameters Calculated - We measure the following matrices

• Return generated by each bucket using monthly update
• Returns generated using annual rebalancing
• SIP returns
• Success rate of categories
• Performance vs benchmark
• Distribution of bucket returns

Method Selection: All the methods are evaluated across the parameters and scored to arrive at the best method for each fund class. The methods are evaluated periodically to measure if a change in method is required

Currently the Mutual Funds are only analysed within their category

We require a minimum history of 3 years to evaluate the Fund's performance and hence new funds will not be rated. Also, since the rating is within the category we require minimum number of funds in the category for the category to be rated. We are currently not rating a few categories like liquid, ultra-short-term funds, FMP etc.