Mirae Asset Focused Fund Direct Payout of Income Distribution cum capital withdrawal INF769K01ET2

Mirae Asset Focused Fund earns a Below Average Process Pillar rating.

The process is bolstered by the stability of the management team. Specifically, the fund has not seen a manager change in the last six years. However, the rating is held back by the parent firm's five-year retention rate of 66%, which raises concerns about long-term strategic consistency.. The parent firm's five-year risk-adjusted success ratio of 46% also holds the rating back. The measure indicates the percentage of a firm's funds that have beat 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, over time, has preferred smaller market-cap companies, compared with others 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. Analyzing additional factors, the fund has held stocks with higher trading volumes compared to Morningstar Category Peers in the past few years. This gives the managers more flexibility during bear markets to sell without adversely affecting prices. In recent months, the strategy was more exposed to the Liquidity factor compared with its Morningstar Category peers as well. This strategy has also leaned away from the stocks of companies with high dividend or buyback yields over these years. Returning capital to shareholders often is not the highest priority of such businesses. The shares of such companies can deliver strong returns if they fulfill their growth projections, but they also carry more risk. In the most recent month, however, the fund's Yield exposure was in line with the Morningstar Category average. Additionally, the strategy has demonstrated a contrarian approach with relatively low exposure to momentum stocks during these years. Momentum investors tend to expect stocks that have done well recently to continue to do so in the short term. Momentum approaches can entail higher turnover and trading costs since the top stocks can often change. In recent months, the strategy also had less Momentum 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 technology and consumer cyclical relative to the category average by 10.8 and 5.3 percentage points, respectively. The sectors with low exposure compared with category peers are financial services and consumer defensive, underweight the average by 6.1 and 3.7 percentage points of assets, respectively. The portfolio is positioned across 31 holdings and is relatively concentrated. In particular, 54.5% of the strategy's assets are housed within the top 10 holdings, compared with the category’s 33.6% average.