For the winners selection we use methodology which consists of three steps:
Ranking of funds
Approximately 150 homogeneous categories are needed to cover all type of risk profile. Ranking takes into account the risk level born by the investor. We compute the ranking of funds based on the RAP in each category. Performance is compared versus competitors rather than benchmarks. The process is done every quarter and stored for each fund.
Inside a category, the Risk Adjusted Performance (RAP) of each fund is:
Performance and RAP are evaluated on a one year period.
Rating of funds
Before comparing funds, it is essential to establish coherent sub groups within the fund population.
FUNDCLASS has adopted a “buy side” approach, meaning
that we consider that a fund can be compared to another fund
only if there is a similar risk profile.
Categorization determines the universe of reference of the rival
The rating must be established in relation to the performance of competing funds belonging to the same category.
The rating must reflect performance in the medium term.
A fund which has been ranked over 12 consecutive one year periods is given a mark equal to its average decile.
FUNDCLASS has defined a scale of Rating based on the average decile.
Rating of Asset Managers
Every European Asset Manager having a fund is rated.
In order to create coherent groups, categories are defined by number of rated funds.
Scale evaluation for rating funds :
Considering the entire set of funds rated for one Asset Manager, we calculate its corresponding weighted average value :
We compute the average mark of all Asset Managers and define 8 categories according to the number of funds held :
In each category, the European winner is the Asset Manager with the highest average mark.
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