What are PlexCrown rat­ings and how are they cal­cu­lated?

Weekend Argus (Saturday Edition) - - GOODHANGOUTS -

PlexCrown rat­ings use four dif­fer­ent mea­sures to cal­cu­late the in­vest­ment per­for­mance of a unit trust fund on a risk-ad­justed re­turn ba­sis.

The rat­ings mea­sure the fund’s volatil­ity com­pared with the bench­mark, the risk of un­der­per­form­ing the bench­mark and the man­ager’s skill in adding value above that achieved by the mar­ket. Funds in each sub-cat­e­gory are then ranked on those four mea­sures over five-and three-year pe­ri­ods.

The ra­tios are time-weighted by ap­ply­ing weights of 60 per­cent and 40 per­cent if five-and three-year pe­ri­ods are used, or 100 per­cent of the mea­sures for three years (in the case of younger funds). From th­ese rat­ings, a com­pos­ite rat­ing is cal­cu­lated, and the fund with the high­est score in the rel­e­vant sub-cat­e­gory is re­garded as the win­ner.

To de­cide the lead­ing fund man­agers, an av­er­age PlexCrown rat­ing for each man­ager is de­ter­mined from the rat­ings of all their funds in all the qual­i­fy­ing sec­tors, with a higher weight­ing given to the man­ager’s do­mes­tic fund rat­ings.

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