Parag Parikh ELSS Tax Saver Fund Regular Growth INF879O01092

Parag Parikh ELSS Tax Saver Fund earns an Above Average Process Pillar rating.

The main driver of the rating is the firm's retention rate of the firm's portfolio managers, which is 100% over the available data period, up to five years. Noteworthy risk-adjusted performance also contributes to the process. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the managers have shown skill in their allocation of risk.

This strategy tends to hold smaller, more value-oriented companies compared with its average peer in the ELSS (Tax Savings) Morningstar Category. Looking at additional factor exposure, this strategy has consistently favored high-quality stocks, including those with low financial leverage and solid returns on equity, compared with Morningstar Category peers during recent years. High exposure to the quality factor means holding companies that are consistently profitable, growing, and have solid balance sheets. In recent months, the strategy was more exposed to the Quality factor compared with its Morningstar Category peers as well. This strategy's portfolio also has had exposure to more stocks with high dividend or buyback yields over peers in these years. High-yield stocks tend to be associated with more mature, profitable businesses that can grow as well as provide a stream of income. Such stocks could suffer, however, if setbacks force them to cut their dividends. Compared with category peers, the strategy also had more exposure to the Yield factor in the most recent month. In addition, the strategy had less exposure to high-liquidity stocks compared with Morningstar Category peers in recent months. Less-liquid stocks might offer strong returns to compensate for their risks, but they can be harder and more expensive to trade in bear markets. 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 financial services relative to the category average by 8.2 and 6.9 percentage points, respectively. The sectors with low exposure compared with category peers are industrials and basic materials, underweight the average by 9.8 and 6.8 percentage points of assets, respectively. The portfolio is composed of 49 holdings and is quite concentrated. Specifically, 57.5% of the fund’s assets are housed within the top 10 holdings, compared to the typical peer's 39.8%. And finally, in terms of portfolio turnover, on a year-over-year basis, 9% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.