Fees on the firm's open-end and exchange-traded funds are a weakness, contributing negatively to the rating and creating a larger performance hurdle on funds. On average, AlphaCentric charges fees on its funds that are in the most expensive quintile of similarly distributed funds. With the current market environment of fee compression, this is cause for concern, as investors may flock over time to alternate asset managers to get a better deal. The AlphaCentric roster of open-end and exchange-traded funds has had below-average risk-adjusted performance, as evidenced by its average five-year Morningstar Rating of 2.3 stars. The firm has not had a durable product lineup. Specifically, its three-year risk-adjusted success ratio demonstrates that only 28% of products were both able to survive and beat their respective category median on a risk-adjusted basis. A low success ratio indicates poor performance and raises questions about a firm’s discipline around investment strategy and product development.
In an increasingly competitive industry, AlphaCentric falls behind on a number of key metrics, resulting in a Low Parent Pillar rating.
United States