Quant Large and Mid Cap Fund Bonus INF966L01424

Quant Large and Mid Cap earns an Above Average Process Pillar rating.

The main driver of the rating is its parent firm's impressive 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 strengthens the process. The measure indicates the percentage of a firm's funds that have beat their respective category's median return for the period. Their commendable 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, over time, has consistently held more undervalued companies, compared with peers in the Large & Mid-Cap Morningstar Category. But in terms of size exposure, it does not have much of a bias and resembles the typical portfolio. Analyzing additional factors, this strategy has continually had more high-yield exposure than the Morningstar Category average during recent years, with the portfolio holding more stocks with high dividend or buyback yields. Higher-yield stocks can provide dependable income, but also have their risks. Dividend payers may cut payouts, for instance, if their earnings fall. Different from its historical appetite, however, the Yield factor was in line with the Morningstar Category average in recent months. 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. This orientation tends to pay off most prominently when markets are hot. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. 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 consumer defensive and energy relative to the category average by 16.5 and 7.9 percentage points, respectively. The sectors with low exposure compared with category peers are financial services and technology, underweight the average by 11.0 and 9.1 percentage points of assets, respectively. The strategy owns 38 securities and is relatively top-heavy. Of the strategy's assets, 55.2% are concentrated within the top 10 holdings, compared to the category’s 32.2% average.