In fact, Morningstar has quantified the value of this advice through a term we call “ Gamma”. The advice, planning, and financial coaching from a trusted advisor is a worthwhile tool in your toolbelt and not something that should be overlooked. Important Note: Many of the funds listed here are F class funds, typically made available through fee-based advisors whose advice is also paid for via an overall management fee on your account (separate from the MERs listed below). To find these funds, I scoured Morningstar’s Canadian mutual fund base and looked specifically at funds with a combination of great historical performance (by looking for Star Ratings of four or five stars), and assessed with the potential to outperform others in the category on a forward looking basis (by looking for a Morningstar Quantitative Rating of Bronze, Silver, or Gold). Stressing this concept, here are some of the best rated mutual funds available to retail investors in Canada based on some of the most popular mutual fund categories. The closer you are to retirement, the less risk you can afford to take (see prior article on human capital vs. As tax shelters are by nature designed to benefit you in retirement, having an idea of when you want to retire will inherently allow you to budget your ‘risk’ accordingly. Investors who are willing to go for this sort of trading-driven model would find a scheme like Quant MF more tax efficient than creating their own algorithms and personally conducting trades," said Dhirendra Kumar, CEO, Value Research.Earlier this week, I outlined the idea that choosing the asset classes in which to invest within your tax sheltered RRSP or TFSA is arguably more important than selecting the investment itself. However, its performance has held up over the past 2 years even as its size has grown exponentially larger and it tops the charts in numerous categories. Their model is proprietary and hence cannot be fully understood. “Quant MF uses a host of data points, including macroeconomic ones to make its buy and sell decisions. If the market turns, I’m not sure how Quant MF will do," said a Mumbai based distributor on condition of anonymity. What I mean by that is high risk-high reward. I started recommending Quant Small Cap and Quant Active Fund to clients who wanted a PMS-like experience in February 2021. The portfolios across funds are quite similar and hence a broad overall strategy works across the board. In addition, the Quant MF portfolio also gets churned rapidly based on a tactical outlook. This means, a portfolio allocation close to the index with some positive or negative deviation. “Most mutual funds in India do some level of index-hugging. The returns posted by Quant’s outperforming schemes are similar despite their different categories. Thus, our high churning is nothing but a representation of our portfolio re-balancing strategy based on a risk on/risk off environment," said Sandeep Tandon, MD and CEO of Quant Capital. What’s interesting is that the same strategy seemed to have worked in schemes with very different mandates such as small cap, multicap and infrastructure. By managing our portfolio dynamically, we are also able to better manage the risk profiling of our schemes, thus, endeavour to deliver superior risk-adjusted returns. Our portfolios always adapt and reflect the changing market conditions, investor sentiments and act upon any in global macros. “Using VLRT framework, we are able to manage our funds dynamically. Our portfolios have a high turnover ratio for this reason but it is also the reason for our high returns," said Anupam Saxena, national sales head, Quant Mutual Fund told Mint in May 2021. “We give 2/3rd weightage to liquidity analytics and risk appetite (risk on or risk off) and 1/3rd to valuations. 55% of the AUM of Quant Small Cap Fund is in its direct plan, corresponding figures for Quant Active and Quant Tax Saver are 49% & 82%.
#BEST PERFORMING MUTUAL FUNDS 2019 CATEGORY FREE#
The roller-coaster returns posted by Quant Mutual Fund attracted a horde of direct investors, many of whom invest through free online portals and are led by recent performance. They are likely to be changed very soon, anyway. It also makes any discussion of the stocks held by the schemes irrelevant. This flies in the face of the traditional ‘buy-and-hold with conviction’ model followed by most fund houses in India. In case of Quant Active and Quant Tax Saver, the turnover ratios are 211% and 283%, denoting even more churn. For Quant Small Cap, the ratio is 145% for 2021, meaning that the portfolio in its entirety was changed more than once. These ratios denote the percentage of a scheme’s portfolio that was changed in the past year. Quant Mutual Fund’s equity schemes across the board are characterised by incredibly high portfolio turnover ratios.