Shriram Flexi Cap Fund Direct Growth INF680P01109

Shriram Flexi Cap Fund earns a Below Average Process Pillar rating.

The process benefits from the size of its portfolio management team. With three portfolio managers at the helm, the fund is reasonably well-resourced. However, the rating is held back by its parent firm's disappointing risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 2.0 stars. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis. Mediocre risk-adjusted performance also weakens the process. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the process has struggled over that period.

This strategy targets smaller plays than its peers’ average in the Flexi Cap Morningstar Category. But in terms of style (value/growth) exposure, it is similar. Analyzing additional factors, this strategy has continually had exposure to high-momentum stocks compared with Morningstar Category peers in the last few years. Momentum approaches bet that rising stocks will continue to rise and that lagging stocks will continue to lag. In recent months, the strategy was more exposed to the Momentum factor compared with its Morningstar Category peers as well. This strategy also has had a defensive tilt, with exposure to higher-quality stocks compared with peers in recent years. This means the fund holds consistently profitable, growing companies with solid balance sheets that may help it endure downturns better than Morningstar Category peers. Compared with category peers, the strategy also had more exposure to the Quality factor in the most recent month. In addition, this strategy has exhibited a tendency to hold fewer stocks with high dividend or buyback yields over peers in recent years. Its preference for stocks with lower yields may well lead to a growthier portfolio. However, growth stocks court additional risks if their forecasts do not come to fruition and are often more volatile than companies with stable dividends. In recent months, the strategy also had less Yield factor exposure than its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section.

The portfolio is overweight in consumer cyclical and healthcare relative to the category average by 3.5 and 3.5 percentage points, respectively. The sectors with low exposure compared with category peers are financial services and energy, underweight the average by 3.6 and 3.1 percentage points of assets, respectively. The strategy owns 63 securities and is about as top-heavy as the category average, with 39.9% of assets in the top 10 holdings.