Sundaram Focused Fund Growth INF173K01189

Sundaram Focused earns a Below Average Process Pillar rating.

The process is strengthened by the experience of the management team, which averages 12 years at this fund. 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 2.5 stars. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis. The parent firm's five-year risk-adjusted success ratio of 36% also detracts from the process. The measure indicates the percentage of a firm's funds that have outperformed their respective category's median return for the period. The parent's relatively low success ratio suggests that the firm could do better across its fund lineup.

This strategy targets larger plays than its peers’ average in the Focused Fund Morningstar Category. But in terms of style (value/growth) exposure, it does not have much of a bias and resembles the category's typical portfolio. Looking at additional factor exposure, this strategy has continually had exposure to high-momentum stocks compared with Morningstar Category peers in the last few years. Momentum is based on the premise that stocks that have recently outperformed will continue to outperform, and those that have underperformed will stay behind. In recent months, the strategy was more exposed to the Momentum factor compared with its Morningstar Category peers as well. This strategy has also been exposed to liquid stocks during these years. More-liquid assets contribute to more-flexible exit strategies without price changes and tend to be a ballast during market selloffs. For example, if the portfolio faces successive redemptions in a short period of time, it will be less likely to experience a significant loss. Compared with category peers, the strategy also had more exposure to the Liquidity factor in the most recent month. Additionally, this strategy has exhibited a tilt toward low-volatility stocks in these years, meaning companies with a lower historical standard deviation of returns over its peers. These companies have historically been a valuable ballast to steady portfolio returns during market downturns. In recent months, the strategy also had less Volatility 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 industrials and energy relative to the category average by 4.9 and 3.4 percentage points, respectively. The sectors with low exposure compared with category peers are basic materials and consumer cyclical, underweight the average by 4.1 and 3.6 percentage points of assets, respectively. The portfolio is positioned across 28 holdings and is relatively concentrated. Specifically, 54.5% of the strategy's assets are housed within the top 10 holdings, compared with the category’s 33.9% average. And in closing, in terms of portfolio turnover, looking at year-over-year movements, 48% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.