Motilal Oswal Business Cycle Fund

The Motilal Oswal Business Cycle Fund has delivered a 1-year XIRR of 0.9986%, which is significantly below the category average of 14.1% for the same period. Over the same horizon, the fund's CAGR of 2.9% outperformed the NIFTY 50's -2.9%, resulting in a positive alpha of 6.78%. However, the fund's absolute returns remain low, and it has underperformed its category peers by a wide margin.

The fund exhibits moderate volatility with a beta of 1.10 against the NIFTY 50 over 1 year, indicating slightly higher sensitivity to market movements. Its maximum drawdown is shallow at -0.25%, but the drawdown duration of 126 days and the fact that it has not yet recovered from this drawdown suggest ongoing weakness. The Calmar ratio of 0.10 over 1 year indicates poor risk-adjusted returns, as the return relative to the maximum drawdown is very low.

The fund is concentrated in a few sectors, with Banks (17.4%), IT Software (17.0%), and Consumer Durables (13.9%) being the top three. Top holdings include Persistent Systems (9.69%), Kalyan Jewellers (9.05%), and Eternal Limited (8.08%), indicating a tilt towards mid-cap and thematic names. With only 22 total holdings, the portfolio is relatively concentrated, which increases stock-specific risk.

The fund's 1-year XIRR of 0.9986% is drastically lower than the category average of 14.1%, placing it in the bottom quartile of its category. Its 3-year and 5-year performance, while not provided as XIRR, show positive alpha over the benchmark, but the fund's returns are still below category averages. The fund has shown inconsistency, with a strong 2024 (23.65%) but negative returns in 2025 (-2.51%) and modest gains in 2026 (1.68%).

This fund is suitable for investors with a high risk tolerance and a long-term investment horizon (5+ years) who are willing to accept significant volatility and potential underperformance in the short term. It is not appropriate for conservative investors or those seeking stable, consistent returns. Investors should be prepared for the fund's thematic nature, which can lead to sharp swings in performance based on business cycle phases.

• Positive alpha over the NIFTY 50 across all time horizons, indicating the fund has outperformed the benchmark on a risk-adjusted basis.
• Higher upside capture (115.49% over 1 year) suggests the fund participates more in market upswings, which can benefit investors during bullish phases.
• Diversified across multiple sectors, including banks, IT, consumer durables, and healthcare, reducing single-sector concentration risk.

• Significant underperformance relative to the category average, with a 1-year XIRR of 0.9986% versus the category's 14.1%.
• The fund has not yet recovered from its maximum drawdown, and the drawdown duration of 126 days indicates prolonged periods of negative returns.