CRISIL adds six new categories to measure mutual fund performance

CRISIL has added six new categories to its FundServices' Composite Performance Rankings (CRISIL~CPRs), beginning September 2006. The six new categories will add more granularity to the ranking, and help investors make better-informed investment choices.

CRISIL~CPR is part of CRISIL FundServices' endeavour to establish the growing mutual fund industry, a credible, objective and analytically-rigorous measure for the recognition of consistent mutual fund performance. The rankings are part of CRISIL's ongoing initiatives to help deepen India's capital markets.

Among the new ranking categories, information technology (IT) funds have been included in the ranking universe since more than five schemes met the requisite criteria for new categories. The five other additions are among equity diversified, monthly income plan (MIP) and liquid schemes.

The large capital-oriented equity scheme category has been carved out of the equity diversified category. Among liquid schemes, ranking has been extended to liquid-institutional and liquid-super institutional plans. The MIP category has been rationalised into conservative and aggressive MIP.

Owing to the sheer size of the diversified equity category, its schemes have thus far been difficult to compare. Some schemes had investments focused in large cap stocks, while other schemes invested across large, mid and small cap stocks, with the result that their performances varied widely from one another.