Motilal Oswal AMC launches Motilal Oswal Hedged Equity Multifactor Strategy (AIF)

According to AMC, Motilal Oswal Hedged Equity Multifactor Strategy AIF combines a multifactor, model-driven investment approach with tail-hedging. The AMC said the scheme has less overlap with Nifty 50 companies and has a correlation of 65-70% key differentiated portfolio exposure.

Equity portfolio is 100% systematic with no human intervention in stock selection and weighting. According to the press release, the equity strategy uses investment factors such as quality, low volatility, price and momentum to build a focused portfolio of 20-25 equity stocks.

Tail-hedging is designed to protect investors from black swan events that are unpredictable but at the same time the most significant contributors to portfolio losses. The fund seeks to provide this protection by creating low-cost ‘long volatility’ positions, which benefit during such times of market volatility, the release said.

“During a period of 10 years starting from 2011, the strategy’s previous test returns were able to generate consistently higher returns at lower volatility than the Nifty 500 TRI, which is the benchmark of the scheme,” the AMC said.

Prateek Oswal, Head, Passive Funds, Motilal Oswal Asset Management Company Limited, said, “Motilal Oswal AMC has always been a pioneer in bringing innovative investment solutions to investors. Motilal Oswal Hedged Equity Multifactor Strategy AIF is a unique offering that combines the benefits of rule-based investing and tail-hedging, with the aim of delivering superior portfolio results in various market conditions.

Commenting on the launch, Sankaranarayanan Krishnan, Fund Manager, PMS & AIF Schemes, Motilal Oswal Asset Management Company, said, “The fund has a distinct portfolio with low overlap with Nifty 50 Index and low BFSI exposure, thereby making a lot of difference. it happens. Low correlation with Nifty 50 index. The portfolio is based on a model that combines factors such as quality and low volatility, which have historically provided alpha in falling markets, along with factors such as price and momentum, which have traditionally performed well in rising markets. Is. The addition of tail hedging not only protects the portfolio from serious losses but also provides capital to invest in the lower levels of the market.”