Quantum Ethical Fund

The Quantum Ethical Fund has delivered a 1-year SIP XIRR of -0.89%, significantly underperforming the category average of 14.1% for the same period. Over the longer term, the fund's CAGR has been modest, with a 3-year CAGR of 1.15% versus the NIFTY 50's 0.6%, but it has consistently lagged the category averages across all time horizons. The fund's 1-year rolling return of 0.18% indicates minimal positive performance on a lump-sum basis, reflecting a challenging return environment.

The fund exhibits a maximum drawdown of -0.16% with a recovery period of 126 days, indicating relatively shallow but prolonged drawdowns. It has experienced 2 drawdown events exceeding 10%, and the average drawdown is -0.05%, suggesting moderate downside risk. The Calmar ratio of 0.011 for 1 year is very low, implying poor risk-adjusted returns relative to the drawdown experienced.

The fund's top 10 holdings account for approximately 33% of NAV, with the largest position in Marico Ltd at 4.6%. Sector concentration is notable, with Automobiles (18.4%), Consumer Durables (15.5%), and IT - Software (13.7%) being the top three sectors, collectively representing nearly half of the portfolio. The fund holds 44 stocks, providing some diversification, but the heavy tilt towards cyclical sectors like automobiles and consumer durables may increase vulnerability to sector-specific downturns.

The fund significantly lags its category peers, with a 1-year XIRR of -0.89% versus the category average of 14.1%, and similar underperformance across 3, 5, 7, and 10-year horizons. The fund's alpha relative to the NIFTY 50 is positive only in the 1-year period (5.83%), but turns negative for longer durations, indicating a lack of consistent outperformance. The fund's downside capture ratio (82.89% for 1 year) is lower than its upside capture (92.7%), suggesting it loses less in down markets but also participates less in up markets, yet the overall returns remain weak.

This fund is suitable for investors with a high risk tolerance and a long-term investment horizon, given its thematic nature and current underperformance. It may appeal to those seeking ethical or ESG-focused investments, but investors should be prepared for significant volatility and potential underperformance relative to broader market indices. The fund is not recommended for investors seeking stable or benchmark-beating returns in the short to medium term.

• Lower downside capture ratio (82.89% for 1 year) indicates the fund loses less than the benchmark during market declines.
• Positive alpha of 5.83% over the 1-year period versus the NIFTY 50, showing short-term outperformance on a risk-adjusted basis.
• Diversified across 44 holdings, reducing single-stock concentration risk.

• Significant underperformance versus category averages across all time horizons, with 1-year XIRR of -0.89% versus 14.1% category average.
• Negative alpha over 3, 5, 7, 10, 12, and 15-year periods, indicating persistent underperformance relative to the benchmark on a risk-adjusted basis.
• High sector concentration in cyclical sectors like Automobiles (18.4%) and Consumer Durables (15.5%), which may lead to heightened volatility and drawdown risk.