Rupeezy Ratings: A Smarter Way to Assess Mutual Funds

When it comes to investing in mutual funds, choosing the right scheme from hundreds of options can feel overwhelming. That’s why we built Rupeezy Rating, a data-driven, category-specific rating system that helps you identify consistently well-performing mutual funds based on risk-adjusted returns.

Unlike traditional ratings that rely on just returns or risk, Rupeezy Ratings blend both into one single, easy-to-understand score, allowing you to compare apples to apples within each category.

What Does Rupeezy Rating Measure?

At its core, Rupeezy Rating captures how much return a fund delivers for the level of risk it takes. This is known as the Sharpe Ratio, a standard risk-adjusted return metric used by investment professionals around the world.

Each Rupeezy Rating reflects:

• How consistently a fund has performed over the past 3 to 5 years

• The level of volatility (standard deviation) in those returns

• A fund’s standing within its category, not against the entire market

So, whether you’re comparing large-cap equity funds or short-duration debt funds, you get a fair and meaningful rating based on how well each fund has rewarded investors for the risks involved.

How is the Rating Calculated?

Rupeezy Rating is entirely quantitative, driven by actual return and risk data, with zero subjective judgment. Here’s how we do it:

Filter the Universe

• Only open-ended growth funds are considered.

• Funds must have at least 3 years of history.

• Each category must have at least 5 eligible funds.

• Certain categories (like Fund of Funds and non-homogeneous types) are excluded.

Measure Returns & Risk

• We look at 3 and 5-year trailing returns.

• For risk, we use the standard deviation over the same periods.

• Sharpe Ratios are calculated as:
  Sharpe = (Return - Risk Free Rate) / Risk

Calculate a Composite Score

• If 5-year data is available:
  Score = (0.6 × 5Y Sharpe) + (0.4 × 3Y Sharpe)

• If not:
  Score = 3Y Sharpe

Rank Within Category

• Each fund is ranked against peers in its category using percentile scores.

Assign Stars

• Based on where a fund stands within its category, it is awarded stars:

What Makes Rupeezy Rating Different?

•  Category-specific: A mid-cap fund is compared only to other mid-cap funds.

•  Risk-aware: It doesn’t just reward high returns, but high returns for the risk taken.

•  Data-driven: No opinions. No bias. Just clean, reliable data.

•  Updated regularly: We refresh our calculations to reflect the most recent performance and volatility.

When a Fund is Not Rated?

Not all funds receive a Rupeezy Rating. We skip ratings if:

• The fund is less than 3 years old

• The category has fewer than 5 comparable funds

• The fund belongs to an excluded or non-homogeneous category

How to Use Rupeezy Ratings?

Rupeezy Ratings are designed to complement, not replace, your investment decisions. A 5-star rating indicates that a fund has outperformed its peers for the level of risk it has taken, not that it will always continue to do so.

Use the rating as a starting point:

• Narrow down the best performers in a category

• Combine with insights on fund managers, consistency, costs, and portfolio strategy

• Match with your investment horizon and risk tolerance

Conclusion

With Rupeezy Ratings, we aim to cut through the noise and bring you a reliable, transparent way to evaluate mutual funds. Whether you’re new to investing or managing a growing portfolio, our rating system helps you focus on what truly matters: consistent, risk-aware performance.

Explore rated funds on the Rupeezy app today and invest smarter.

Rupeezy Fund Rating FAQs

Q. What is the purpose of Rupeezy's fund ratings for investors?
Rupeezy’s fund ratings provide a straightforward way for investors to identify funds that have demonstrated strong risk-adjusted performance compared to similar funds. These ratings are entirely impartial and based on objective data.

Q. How should investors interpret fund ratings?
Fund ratings reflect a fund’s past performance in terms of both risk and return, compared to its peers in the same category. While useful, these ratings should be viewed as a starting point for evaluating funds and not the sole factor in investment decisions.

Q. Can fund ratings help build a diversified portfolio?
A well-balanced portfolio doesn’t have to include only funds with 4- or 5-star ratings. Investors should also account for their own risk appetite, the role each fund plays in the overall portfolio, and the importance of diversification across asset types. Sometimes, even a 2-star fund could serve a specific purpose in a broader strategy. For tailored guidance, it’s best to consult an investment advisor.

Q. Are Rupeezy's fund ratings only based on returns?
No. The star ratings are derived from a combination of return and risk metrics to ensure a well-rounded assessment.

Q. How frequently are the fund ratings updated?
Rupeezy updates its fund ratings on a monthly basis.

Q. Do fund houses pay Rupeezy to get their funds rated?
No, Rupeezy does not accept any payment from fund houses for rating their funds or for displaying these ratings.

Q. Are fund ratings assigned individually or in groups?
Funds are evaluated within their respective categories and rated relative to other funds in that same category.

Q. What is the minimum requirement for a category to be rated?
To qualify for ratings, there must be at least 10 funds in a category. For equity and hybrid funds, each must have a minimum track record of three years. For bond funds, the requirement is 18 months.

Q. Which types of funds are excluded from Rupeezy’s ratings?
Funds that are thematic, international, closed-ended, or those that do not fit neatly into defined categories are not rated. Also, funds that don’t regularly publish their NAVs are excluded.

Q. Do Rupeezy’s ratings account for fund management fees?
Yes. All ratings are based on post-fee returns. No additional weighting is given for management fees beyond their natural impact on performance.

Q. Are loads (entry/exit charges) included in the rating calculation?
No. Since loads vary across investors and transactions, they are not included in the ratings. Investors should consider loads separately when choosing funds.

Q. What’s the minimum track record required for a fund to receive a rating?
Funds must have a history of at least three years.

Q. What if a fund I hold is rated only 2 stars—should I exit?
Not necessarily. A low rating doesn’t mean you should immediately sell. Ratings are retrospective evaluations of past performance. It’s more important to assess whether the fund still aligns with your goals.

Q. Why do star ratings change over time?
Ratings are recalculated monthly using a standard mathematical formula. Any change in rating is a reflection of the fund’s updated relative performance, not a manual downgrade by Rupeezy.

Q. What should I do if a fund I own loses a star?
A lower rating can be a signal to review the fund’s performance more closely. However, it doesn’t automatically mean the fund should be removed from your portfolio.