Baroda BNP Paribas Multi Cap Fund Regular Growth INF955L01674

Baroda BNP Paribas Multi Cap Fund earns an Average Process Pillar rating.

The main contributor to the rating is the fund's impressive long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category index, which suggests that the managers have shown skill in their allocation of risk. The stability of the management team also bolsters the process. Specifically, the fund has not seen a manager change in the last four years. However, the process is limited by its parent firm's subpar risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 2.7 stars. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis.

This strategy skews toward smaller, higher-growth companies compared with its average peer in the Multi-Cap Morningstar Category. Analyzing additional factors, this strategy has continually had exposure to high-momentum stocks compared with Morningstar Category peers in the last few years. Momentum is based on the premise that market outperformers will continue to outperform, and laggards will continue to lag. This means that managers are overweighting stocks currently on a winning streak. In recent months, the strategy was more exposed to the Momentum factor compared with its Morningstar Category peers as well. The managers have also tended to underweight yield compared with peers during recent years. This is demonstrated by the portfolio's low exposure to dividends or buybacks. While companies with high yields provide steady income payments, they may cut payouts if their earnings decline. Similarly, in recent months, the strategy also had less exposure to the Yield factor than peers. In addition, this strategy has exhibited a tilt toward higher-volatility stocks in these years, meaning companies that have a higher historical standard deviation of returns compared with peers. This is a higher-risk, higher-reward approach. In this month, the strategy also had more exposure to the Volatility factor over 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 healthcare and consumer defensive relative to the category average by 7.5 and 3.7 percentage points, respectively. The sectors with low exposure compared with category peers are consumer cyclical and basic materials, underweight the average by 4.8 and 2.7 percentage points of assets, respectively. The strategy owns 62 securities and is diversified among those holdings. In its most recent portfolio, 26.8% of the fund’s assets were concentrated in the top 10 fund holdings, compared to the category average's 29.3%. And finally, in terms of portfolio turnover, looking at year-over-year movements, 1% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.