360 ONE Quant Fund: One of top performing quant funds for current market conditions

Current Market Context

Equity market is volatile after US tariffs came into force for Indian exports to the United States. The Trump Administration has imposed 50% tariffs in Indian exports to United States, higher than any other Asian economy. This may impact competitiveness of India exporters in the US market. The Government is exploring alternative trade opportunities with other economies / markets. The uncertainty has dragged the market down with Nifty trading below the psychologically important 25,000 level. On the positive side, the Prime Minister in his Independence Day speech that the Government is looking at rationalizing GST structure which may boost domestic consumption. In an environment of uncertainty with both risks and opportunities, stock selection becomes key in portfolio performance. Quant investing is becoming popular globally, especially in developed markets. Quant investing is also catching up in India. One of main advantages of quant investing is elimination of fund manager biases, while still employing active strategy in stock selection and portfolio management.

What is quantitative investing?

Quantitative investing or quant investing is a rule-based investment strategy that uses statistical techniques to make investment decisions. Quant funds are thematic equity mutual fund schemes, which utilize complex mathematical models and algorithms to make investment decisions. These funds harness the power of data, statistics, and computer programming to identify patterns, trends, and opportunities in the financial markets. Though quantitative models drive the investment strategy of quant funds, they are actively managed schemes. The fund managers of quant schemes develop the quantitative models and review the models on a periodic basis. In this article we shall review the 360 ONE Quant Fund whose performance has caught our attention.

360 ONE Quant Fund – Regular Growth Option

The 360 ONE Quant Fund is a Quantitative equity fund which uses the momentum investment strategy. This fund was formerly known as the IIFL Quant Fund, is managed by Mr. Ashish Ongari. The AUM of the scheme is 767 Crores (as on 31^st July 2025) The fund has given 19.33% CAGR returns since its inception in November 2021. The fund's robust performance despite the volatility makes it a strong proposition from a risk / return standpoint for long term investors.

Outperformed market benchmark

The chart below shows the 1 year rolling returns of 360 ONE Quant Fund versus the market benchmark Nifty 200 TRI since the inception of the fund. You can see that the fund was able to outperform Nifty 200 TRI most of the times over 1 year investment tenure. The average and median rolling returns of 360 ONE Quant Fund was significantly higher than Nifty 200 TRI. The fund has given 15%+ CAGR returns in more than 60% of the instances (1 year tenure) since inception.

Source: Advisorkhoj Research as on 28^th Aug 2025

Superior performance versus market index across market conditions

The chart below shows the averages, medians, maximum and minimum of 1, 2 and 3 year rolling returns of the 360 ONE Quant Fund versus the market index, Nifty 200 TRI since the inception of the fund. You can see that the fund outperformed the market index on all parameters across most investment tenures, across different market conditions since its inception.

Source: Advisorkhoj Research as on 28^th Aug 2025

The chart below shows the rolling returns distribution of the fund for different investment tenures since the inception of the fund.

Source: Advisorkhoj Research as on 28^th Aug 2025

You can see that percentage of instances of 15%+ CAGR returns was significantly higher for the fund compared to the market index.

Strong risk adjusted returns

Market capture ratio is a measure of the performance of a mutual fund scheme relative to the market benchmark in rising and falling markets. Up Market Capture Ratio tells us how much percentage of the market's upside was captured by the fund, while Down Market Capture Ratio tells us how much percentage of the market's downside was arrested by the fund. Up Market Capture Ratio and Down Market Capture ratio can give us a sense of risk adjusted returns. We looked at the market capture ratios of 360 ONE Quant Fund over the last 3 years.

The Up Market Capture Ratio of 360 ONE Quant Fund over last 1 year was 132% which implies that if the benchmark up by 1% in a month, then the scheme's Net Asset Value (NAV) went up by 1.32%. The Down Market Capture Ratio of the fund was 102% which implies that if the benchmark index went down by 1% in a month, then the scheme's Net Asset Value (NAV) went down by 1.02%. The market capture ratios of 360 ONE Quant Fund are a clear indication of the potential of the fund to give superior risk adjusted returns of the fund.

Superior risk adjusted returns compared to peers

We looked at the Sharpe Ratios of the quant funds that have completed minimum 3 years since launch. 360 ONE Quant Fund has delivered the highest Sharpe Ratio compared to its peers.

Source: Advisorkhoj Research as on 31^st July 2025

SIP Performance

A monthly SIP of Rs 10,000/ started at the inception of the fund would have grown to Rs 6.6 lakhs (as on 28^th August 2025) against a cumulative investment of Rs 4.5 lakhs, giving an XIRR of more than 20%.

Source: Advisorkhoj Research as on 28^th August 2025

Investment Process - 360 ONE Quant Fund

The investment process of the fund is based on thematic momentum strategy. This strategy optimizes momentum factor under certain portfolio constraints.

• First step is to review the investment universe of Top 200 companies by market cap and liquidity listed on National Stock Exchange (NSE) or Bombay Stock Exchange (BSE).


• A screening of stocks is done basis SCDV framework, liquidity and size of the firm.


• Once screening of list of stocks is done, each stock is updated with their momentum factor score. The momentum score is calculated using stock price and total returns over a period, usually a year, for each stock.


• The entire portfolio construction process is done using the inhouse proprietary quantitative models to calculate factor scores. The factor construction is continuously reviewed, and methodology is based on academic literature and internal research.
  
  

  

  Source: 360 ONE AMC SID

Stock selection Strategy

The 360 ONE Quant Fund uses the SCDV framework to screen stocks having higher profitability and stable earnings trajectory (see illustration). SCDV framework classifies companies into 4 quadrants -

1. Secular: Companies delivering 15% PAT and ROE growth rates, playing out India's secular upward growth shift e.g., financial services, consumer discretionary, auto and auto ancillaries etc.


2. Cyclicals: High growth companies which typically have high capital expenditures and hence a lower ROE e.g., Infrastructure, logistics, capital goods etc. These have relatively higher sensitivity to business and economic cycles.


3. Defensive: Companies that have high ROE and lower growth rates, low capital expenditures and sensitivity to business cycles, but that provide a cushion to returns during downturns e.g., consumer staples, healthcare etc.


4. Value Traps: Companies that register low growth rates and ROE, which are typically avoided across public equity strategies etc.
   
   

   

Portfolio Construct

Source: Fund Factsheet as on 31^st July 2025

Who should invest in 360 ONE Quant Fund?

• Investors looking for capital appreciation over long investment horizon.


• Investors with high to very risk appetites


• Investors with minimum 5 years investment tenures

Consult you financial advisors or mutual fund distributors to understand if 360 ONE Quant Fund is suitable for your investment needs.