Investment Analysis

Investment analysis is a broad term for many different methods of evaluating investments, industry sectors, and economic trends. It include charting past returns to predict future performance, selecting the type of investment that best suits an investor’s needs, or evaluating individual securities such as stocks and bonds to determine their risks, yield potential, or price movements.

Our framework of investment analysis help us to determine how an investment is likely to perform and how suitable it is for a particular client. The key factors which we also consider in investment analysis include the appropriate valuation at the time of entry, the expected time horizon for holding an investment, and the role the investment will play in the portfolio as a whole.

In investing, one size does not fit all! Just as there are many different types of investors with unique goals, time horizons, and incomes, there are investment opportunities that match those individual parameters. Therefore, we designed an investment analysis framework which integrates individual / portfolio parameters with product level analysis.

At an individual level we evaluate an overall investment strategy in terms of risk profile, asset allocation, the person’s needs, financial goals, thought process that went into making it, how the portfolio performed, and whether it’s time for portfolio re-balancing or course correction.


At a product level we follow a 5 P’s Due-Diligence Framework which is illustrated below:


Macro analysis and forming a house-view:

  • G-Sec yield curve, Credit spreads, credit analysis, liquidity analysis
  • Identification of lucrative segment on the yield curve & corporate credits
  • Fund’s Investment Philosophy and distinctiveness of strategy
  • Robustness of AMC’s investment decision-making and risk management processes
  • Individual stock / credit caps, sectoral exposure caps, group level caps  



In-depth portfolio analysis of the investment which include the below factors:

  • Asset Under Management (AUM) of the scheme / investment
  • Portfolio attribution on a stock as well as sector level
  •  Average Maturity, Modified Duration, Credit Quality and Yield (for fixed income and hybrid investment)
  • Portfolio level overlap for schemes within the AMC and at a category level



Performance parameters for Investment Selection is based on:

  • Fund house expertise
  • Performance consistency based on risk adjusted returns, alpha, R-square, standard deviation, etc.
  • Fitment in the portfolio
  • Vintage of the fund
  • Portfolio investment strategy
  • Credit rating of underlying instrument / stocks held in the portfolio of the investment


  • Credibility and experience of the fund management team
  • Identifying the style proficiency of fund manager
  • Vintage of the fund management team


  • AMC Size, Scale, Vintage, track record and brand image
  • Parent / Shareholding / Foreign JV partner of the AMCs
  • Experience of the fund house / fund managers

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