Back in Sep 2022, when fund performance had taken a hit, Akhil came on WFTV with a bold call, asking all distributors to take a front-view mirror approach rather than rear view and consider MO’s equity funds. This was on the back of significant changes that its investments team was making to align strategy with evolving market conditions.
After a strong 2023, he came back on WFTV in Jan 24, stating that MO’s outperformance cycle had just begun and it was still a great time to get clients into MO’s equity funds. This was on the back of more robust risk management processes that were put in place to enhance consistency of performance.
The fund house today sports an entire range of cap based equity funds, all of which have delivered top decile performance over 1 and 3yrs. Those who heeded Akhil’s Sep 22 call have been handsomely rewarded.
Akhil recommends MO’s Large & Midcap Fund, Flexicap Fund and Large Cap Fund as useful additions to investors’ portfolios at this stage as these funds have sizeable large cap allocations and operate under tighter guardrails that respective fund managers have put in place.
Funds that still need some surgery before Akhil recommends them include their BAF and Focused Fund.
The fund house has leveraged performance tailwinds by scaling up to over Rs.150,000 crs, with both active and passive strategies contributing meaningfully.
Akhil cautions that market valuations are elevated, earnings growth stories are becoming more scarce and those with strong earnings are being chased by all. One has to factor in the possibility of 2 or 3 quarters of tepid markets while the earnings growth to valuations equation adjusts itself one way or the other.
His biggest learning from observing Motilalji and Raamdeoji closely over the years is to decide your equity allocation up front and then stick to it no matter what. Keep rebalancing your portfolio when markets move sharply either way and stay invested with your allocation across cycles.
Akhil says today’s affluent investors don’t just want alpha – they want diverse investment experiences too. It is this second need that drives them to experiment with newer investment vehicles and themes. MFDs would do well to appreciate this growing desire for diverse experiences and familiarize themselves with all the newer products coming into the market in order to guide their clients appropriately.