Starting today, our readers will notice a big change on our website, as well as in Value Research's publications. Our fund categorisation system has undergone a massive change, which is the biggest single overhaul it has had since it was first started in 1994. This change is not voluntary--it was triggered by a complete reorganisation of fund types that has been enforced by the market regulator SEBI. There are pluses as well as minuses of SEBI's action, but on the whole, it should be a positive for fund investors.

The table below gives you an idea of how things have changed. There are a few things we would like to point out:

1. We have not followed the SEBI system precisely. We have distributed the official 'Focussed', Index/ETF, Funds of Funds, and 'Solution-Oriented' funds into whichever categories they fitted in as per their portfolio. We believe this serves investors' needs much better.
2. You will notice that our star ratings have changed substantially. This is inevitable, as these ratings are category-wise and the categories have changed extensively.
3. Now on, we will rate direct and regular plans separately, i.e., regular plans will be compared against other regular plans, and direct plans will be measured against other direct plans. So, don't worry if you see a fund's direct plan being rated lower than it's regular plan. 
4. A small number of funds which used to be rated earlier are no longer rated. There are two reasons for this:
   1. Some funds' basic characteristics have changed. In these cases, the funds will be rated only when they have built up a long enough track-record in their new avatar. This is 18 months for debt funds and 3 years for equity and hybrid funds.
   2. We do not rate categories that are smaller than ten funds as the sample for comparison has to be a certain minimum size. Since, under the new system, there are a larger number of generally smaller categories, many funds which were formerly rated are now in small categories.