Dear Value Research, duration matters!

Published: August 23, 2016 at 3:03 pm

Last Updated on

Yesterday, I had posed two questions for your consideration. Thank you to all readers who participated. The first question was subjective and there is no right or wrong here. The second question which asked for missing information from a data table found in the performance tab of a typical Value Research fund page has a specific answer. I hope someone from the organisation gets to read this,understands the importance of the missing information and arranges to include it. Hence the title.

So let us consider the second question in this.

What is missing in this data table?


The first comment was by Mr. Kumar and he was spot on:

I would guess that the duration or the period over which the table from Value Research is created is unknown

The duration over which the mean, Std Dev, Sharpe, Sortino, Beta, Alpha has been calculated is not specified anywhere. Mr Ravindra also got it right.

Without this, comparing the risk measures of the fund, with the index and the category is meaningless. This could be over 1Y, 3Y or 5Y  who knows! Dear Value Research,  duration matters!

Even the fund card, a pdf file that can be downloaded from each fund page only refers to these risk measures as

A range of statistical measures that can be used to evaluate the performance, risk, and return of a mutual fund

An educated guess would be 3 years. First, one will have to head to the fund selector page.

Then choose a particular category. Remove all existing exclusions and add the ones shown here


If you update the fund list, then none of the funds will have a 3-year return . That is they are less than 3Y old from the last business day.

The risk stats tab will be empty


That is, these risk measures will be calculated only if a fund is at least 3 years old. And for such funds, the data present in this table matches with the data in the performance tab of the funds page.

Join our 1200+ Facebook Group on Portfolio Management! Want to know how to reduce fear, doubt and uncertainty while investing for financial goals? Sign up for our lectures on goal-based portfolio management and join our exclusive Facebook Community

Therefore one can infer (only infer) that the duration for those risk measures is 3 years. I believe that VR is obliged to provide the duration information to its users.

Not only that. Let us go back to the first table again.


How many of us can understand what mean here stands for?

My understanding is, it is the mean monthly return over a 3 year period (inference).  The corresponding standard deviation is mentioned next.

I understand very few people bother to look at this measures because only very (relatively speaking) understand what they stand for.

Even those who understand what Sharpe, Sortino, Alpha and Beta stand for, cannot (and should not) use this data unless the duration is specified. As mentioned (in passing) before, this is one of the many reasons why Morningstar is better than Value Research for mutual fund investing.

Dear Value Reseach,

Please the take the trouble of adding relevant information to the data you provide. Otherwise, it is of little use.

Also, a high beta rank does not have the same meaning as a high alpha rank.

A detailed document as to how to read these measures would be great. Perhaps you have this somewhere, but it is crucial to link to that article below each risk measure data table.

Update:  Anish Mohan had written to VR helpdesk about this issue with a link to this post and got the following response in about an hour.

Dear Mr Mohan,

We use calendar month returns over the last three years to calculate all risk measures.

This sentence will be added below the Risk Measures data very soon.

Value Research HelpDesk

Thank you as always, Anish. Better late than never, I guess!

Do share if you found this useful
Join our 1200+ Facebook Group on Portfolio Management! Want to know how to reduce fear, doubt and uncertainty while investing for financial goals? Sign up for our lectures on goal-based portfolio management and join our exclusive Facebook Community

Hate ads but would like to support the site? Subscribe to our ad-free newsletter and get beautifully formatted full articles delivered to your inbox!

About the Author

Pattabiraman editor freefincalM. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. since Aug 2006. Connect with him via Twitter or Linkedin Pattabiraman has co-authored two print-books, You can be rich too with goal-based investing (CNBC TV18) and Gamechanger and seven other free e-books on various topics of money management. He is a patron and co-founder of “Fee-only India” an organisation to promote unbiased, commission-free investment advice.
He conducts free money management sessions for corporates and associations on the basis of money management. Previous engagements include World Bank, RBI, BHEL, Asian Paints, Cognizant, Madras Atomic Power Station, Honeywell, Tamil Nadu Investors Association. For speaking engagements write to pattu [at] freefincal [dot] com

About freefincal & its content policy

Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on developments in mutual funds, stocks, investing, retirement and personal finance. We do so without conflict of interest and bias. We operate in a non-profit manner. All revenue is used only for expenses and for the future growth of the site. Follow us on Google News
Freefincal serves more than one million readers a year (2.5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified from credible and knowledgeable sources before publication. Freefincal does not publish any kind of paid articles, promotions or PR, satire or opinions without data. All opinions presented will only be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)

Connect with us on social media

Our Publications

You Can Be Rich Too with Goal-Based Investing

You can be rich too with goal based investingThis book is meant to help you ask the right questions, seek the right answers and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now. It is also available in Kindle format.

Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want

Gamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you wantThis book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at low cost! Get it or gift it to a young earner

Your Ultimate Guide to Travel


This is a deep dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when traveling, how traveling slowly is better financially and psychologically with links to the web pages and hand-holding at every step. Get the pdf for Rs 199 (instant download)  

Free Apps for your Android Phone

Comment Policy

Your thoughts are the driving force behind our work. We welcome criticism and differing opinions.Please do not include hyperlinks or email ids in the comment body. Such comments will be moderated and I reserve the right to delete the entire comment or remove the links before approving them.

Leave a Reply

Your email address will not be published. Required fields are marked *