The 'Mutual Fund' section of the portfolio report provides an in-depth analysis of your mutual fund portfolio, covering performance, diversification, benchmark comparisons, and risk and return metrics. It helps assess portfolio health and offers actionable insights to optimize your investments.
1. Summary:
Gives a high-level overview of your mutual fund portfolio’s performance across various categories, including daily insights, portfolio score, performance summary, and key risk and return metrics.
Quick Daily Insights:
A snapshot of your mutual fund portfolio's daily performance, highlighting metrics such as daily gains, unrealized P&L, current value, and the amount invested.
Portfolio Score:
The mutual fund portfolio score is calculated as the weighted average of Trendlyne’s Checklist Score for all mutual funds in your portfolio. The Checklist Score evaluates a fund’s performance, portfolio quality, operational efficiency, and risk versus reward, with each factor contributing equally to the final score.
Performance Summary:
Provides details about your portfolio’s overall performance, including total investment, unrealized profit/loss, and percentage gain or loss.
Diversification Summary:
Examines how your portfolio is allocated across different mutual fund categories and individual funds, offering insights into diversification.
Key Risk and Return Ratios:
Evaluates the risk, volatility, and returns associated with your mutual fund portfolio, helping you understand the balance between risk and reward.
2. Performance:
The Performance section provides a detailed analysis of your mutual fund portfolio, covering various aspects such as portfolio performance, asset-wise performance, fund-wise return analysis, and fund-wise performance.
Portfolio Performance:
Displays the total invested amount, unrealized profit or loss, and the percentage of gain or loss for your mutual fund portfolio.
Asset-Wise Performance:
A heatmap representation of your portfolio's gains and losses categorized by mutual fund types. This allows you to identify top-performing fund categories and assess the share of unrealized gains or losses in each category.
Fund-Wise Return Analysis:
Presents the historical performance of your mutual funds over 1-year, 3-year, and 5-year periods, independent of your purchase price or date.
You can view the performance of all mutual funds in your portfolio by clicking ‘View All Mutual Funds. ’
Fund-Wise Performance:
Breaks down the portfolio’s performance (P&L) by individual mutual funds, highlighting top-performing funds and their share of unrealized gains or losses.
View the performance in either Rs format or by ROI (Return on Investment).
Access detailed performance for all your mutual fund investments by clicking ‘View All Mutual Funds. ’
3. Diversification:
This section provides insights into the diversification of your mutual fund portfolio, helping you understand its allocation across categories, funds, market capitalization, and individual stocks while also evaluating debt fund exposure.
Asset Distribution:
Analyzes your portfolio's allocation across various mutual fund categories. Diversifying across asset classes helps mitigate market risk and volatility.
Fund Distribution:
Displays a pie chart illustrating the portfolio’s allocation among different mutual funds. Achieving balanced diversification is key to reducing market risk while maintaining optimal returns.
Insight Highlight: Identifies the worst-performing mutual fund in your portfolio.
Market Cap Distribution for Equity Mutual Funds:
Examines the portfolio’s allocation across large-cap, mid-cap, and small-cap equities for equity mutual funds.
Note: Large-cap stocks are generally less risky, while small and mid-caps offer higher growth potential but with increased risk.
Stock Distribution for Equity Mutual Funds:
Consolidates and reviews the weightage of individual stocks across all mutual funds in your portfolio. This helps assess exposure to specific stocks.
Click ‘View All Stocks’ to see the share and current value of each stock across all your mutual funds.
Debt Exposure:
Analyzes the maturity profile and credit quality of debt funds in your portfolio, providing insights into the risk and stability of your debt investments.
4. Key Risk and Return Ratios:
This section evaluates critical risk and return metrics over 1, 3, and 5 years to help you assess the potential risks and returns of your mutual fund portfolio.
Risk Ratios:
Beta (β):
Beta measures the volatility or systematic risk of your portfolio in comparison to its benchmarks. A beta higher than 1 indicates that the portfolio is more volatile than its benchmarks.
Standard Deviation
This metric measures the variability of returns from the average. A higher standard deviation indicates greater risk with volatile returns. Whereas a lower standard deviation signifies less risk and more consistent returns.
Sortino Ratio
The Sortino ratio focuses on risk-adjusted returns by considering only the negative volatility (downside risk). 1 to 2 is favorable, and above 2 is excellent. A negative ratio is considered poor.
Return Ratios:
Sharpe Ratio
The Sharpe ratio measures the risk-adjusted return, comparing the excess return gained with the extra risk taken. Above 1 is good, above 2 is very good, and above 3 is excellent.
Jensen's Alpha
Jensen's alpha measures the portfolio’s excess return relative to what the capital asset pricing model (CAPM) predicted. Also known as alpha, it indicates whether the portfolio is outperforming or underperforming its expected return.
Treynor's Ratio
The Treynor ratio calculates the excess return earned for the risk assumed, focusing on market risk rather than total risk. A higher ratio indicates better performance, while a negative ratio suggests underperformance compared to a risk-free instrument.
