Quant Mid Cap Fund Reinvestment of Income Distribution cum capital withdrawal option INF966L01168

Quant Mid Cap Fund earns an Above Average Process Pillar rating.

The leading factor in the rating is its parent firm's superior long-term risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 4.8 stars. The parent firm's five-year risk-adjusted success ratio of 100% also influences the rating. The measure indicates the percentage of a firm's funds that have outperformed their respective category's median return for the period. Their respectable success ratio suggests that the firm does well for investors and that this fund may benefit from that. However, the process is limited by the parent firm's five-year retention rate of 69%, which raises concerns about long-term strategic consistency..

This strategy skews toward larger, more undervalued companies compared with its average peer in the Mid-Cap Morningstar Category. Analyzing additional factors, the managers have consistently overweighted yield-paying companies compared with Morningstar Category peers in recent years, shown by the portfolio's high exposure to stocks paying dividends or buying back shares. High-yield stocks tend to be connected to more mature companies earning enough cash to return some to shareholders. At times, however, extreme market pressure can force them to cut their dividends, which hurts stock performance. In recent months, the strategy was more exposed to the Yield factor compared with its Morningstar Category peers as well. This strategy also has had an overweight bias to the volatility factor over these years, meaning it has owned companies that have a higher historical standard deviation of returns. Such stocks tend to rise faster and fall harder than the broad market. High-volatility exposure contributes to stronger performance during bull markets, but often at the cost of losing more during downturns. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. Given the high trading volume of holdings, this fund also holds highly liquid assets. More-liquid assets are easier to buy and sell without adversely moving their prices and tend to provide some ballast during market selloffs. They also are easier to sell to meet redemptions if a host of investors decide to leave the fund in a short period of time. Nevertheless, the fund's Liquidity exposure was in line with peers in the latest month. 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 defensive and energy relative to the category average by 11.7 and 10.7 percentage points, respectively. The sectors with low exposure compared with category peers are financial services and technology, underweight the average by 15.0 and 11.4 percentage points of assets, respectively. The portfolio is composed of 35 holdings and is relatively concentrated. Specifically, 62.6% of the strategy's assets are housed within the top 10 holdings, compared with the typical peer's 23.2%. And finally, in terms of portfolio turnover, on a year-over-year basis, 105% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.