Taurus Discovery (Midcap) Fund - Direct Plan-Payout of Income Dist cum cap wdrl INF044D01CB7

Taurus Discovery(Midcap) earns a Low Process Pillar rating.

The primary detractor from the rating is the fund's unremarkable long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category index, which suggests that the process has struggled over that period. The parent firm's subpar risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 2.4 stars, also weakens the process. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis. The parent firm's five-year risk-adjusted success ratio of 26% further limits the process. The measure indicates the percentage of a firm's funds that have outperformed their respective category's median return for the period. The parent's subpar success ratio suggests that the firm could do better across its fund lineup.

This strategy, over time, has preferred smaller market-cap companies, compared with others in the Mid-Cap Morningstar Category. But in terms of style (value/growth) exposure, it is similar. Analyzing additional factors, this strategy has consistently overweighted the volatility factor compared with Morningstar Category peers over the last few years, meaning it invests in stocks with a history of the higher standard deviation of returns. Such exposure tends to pay off when markets are hot and to be costly when they are not. Different from its historical appetite, however, the Volatility factor was in line with the Morningstar Category average in recent months. This strategy has also demonstrated an overweight liquidity risk tilt, evidenced by holding companies with relatively lower trading volumes than peers in these years. 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. In the most recent month, however, the fund's Liquidity exposure was in line with the Morningstar Category average. Additionally, the strategy had less exposure to high-quality stocks compared with Morningstar Category peers in recent months. Such positions do not tend to provide much ballast for a portfolio. 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 financial services and communication services relative to the category average by 6.7 and 4.3 percentage points, respectively. The sectors with low exposure compared with category peers are technology and healthcare; however, the allocations are similar to the category. The portfolio is positioned across 52 holdings and is relatively top-heavy. Of the strategy's assets, 34.4% are concentrated within the top 10 holdings, compared to the category’s 24.2% average. And in closing, in terms of portfolio turnover, on a year-over-year basis, 113% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.