Summary |
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Financial Express Dragon Ratings are a quant-based ratings system designed to highlight funds that have had superior
performance and consistency on a risk adjusted basis, relative to their peer groups, the fund sectors as defined by
the IMA and the ABI.
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The ratings cover UK authorised unit trusts and open-ended investment companies (OEICs) and are based on quantitative
historical performance measures, and funds are ranked within their own sectors. The lowest rated funds in a sector
carry a single dragon, and the highest are awarded three dragons.
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The ratings are compiled using three key measurements of a fund's performance - alpha, volatility and consistency.
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Financial Express Dragon Fund Ratings will be of interest to advisers who have conducted a preliminary asset allocation
exercise with their clients, and who now wish to identify the more promising funds within their chosen sectors. They
can be used as a filtering tool to segregate those funds that have adhered to the 3 metrics over a length of time,
and thus have offered superior risk-adjusted performance.
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