Where to invest now? Fund Managers Share Investment Strategies

Given where the markets are, experts recommend diversifying into a few less correlated asset classes in order to smooth out any market conditions. From stocks, real estate mutual funds to gold, fund managers have varying investment ideas as they see a lot of opportunities and give advice on how it should play out right with the current market conditions.

great theme to track

While it is true that stock markets are hitting new highs and valuations are not compelling, the key drivers of stock prices are growth in corporate earnings and liquidity. PGIM India Mutual Fund CIO Equity Srinivas Ravuri said that since Corporate India is likely to post good earnings growth in the coming quarters, both are in favor of the market.

This, along with the financialization of savings and lower interest rates, could propel the stock markets. Asset allocation is the most important part of financial planning. Our priorities are MF, Global, REIT, Real Estate, Stocks and Gold in that order.

Trying to capture short-term market opportunities is very lucrative but extremely difficult to execute. For example, buying good quality companies should have been the easiest thing to do to crash March 2020, but very few people actually did it, and what’s even more frustrating is that people actually did it in the April-June 2020 quarter. Selling their holdings and hoping to buy them cheap later. Hence, it is best to buy good quality MFs, REITs and stay invested.

There are two big topics to track manufacturing and consumption. Government incentives through PLIs and the need for additional sources to reduce dependence on China have created a favorable environment for the Indian manufacturing sector (electronics, chemicals, pharma to name a few). Ravuri said that increasing share of middle class consumers will result in faster growth of consumer discretionary products and technology will play a more prominent role.

asset allocation

Ashutosh Bhargava, fund manager and head equity research, Nippon India MF, said where the markets are, it is better to diversify into some less correlated asset classes like equities, bonds and gold. That said, investors with an investment horizon of at least 3 years or more should have a very high proportion of equities in their portfolio as it has the best potential to deliver good inflation-adjusted returns.

From shorter time frame, Bhargava recommends asset allocation strategies like Balance Advantage Fund or Multi Asset Fund.

“If India is to achieve its true potential, credit to GDP should increase from less than 60% to 100% in the next decade. Therefore, financial intermediaries of all types should form a major part of the portfolio of long-term investors. needed.”

long term equity

Chandraprakash Padiyar, Senior Fund Manager, Tata Mutual Fund believes that over the long term (10 years+), Indian equities will continue to play a major role in any asset allocation and hence will continue to recommend equities. Also, as a discipline, investors should maintain their overall asset allocation based on their individual risk profile and financial goals. Short-term volatility is common across all asset classes, which should not affect the overall asset allocation.

Padiyar further added that he firmly believes in investing through diversified mutual fund schemes. Thematic and sectoral funds are generally used to add risk/reward to one’s asset allocation, however in such cases the entry and exit needs to be done well.

“The market is a slave to earnings and over time the value of a business increases due to the increase in its earnings and cash flow. Keeping this in mind, I think at the present time, growth will be delivered by most of the sectors/companies and hence it is likely to see wider market movement. However, I think India’s manufacturing as a topic may stand out in the next 5-10 years and that is something I will be looking at going forward,” he suggested.

ETF or MF, Commodity or REIT

Ashish Chanda, Founder and CEO, Crystal.AI said when it comes to choosing between ETFs and MFs. ETFs offer certain advantages over MFs. For example, they are cheaper than MFs and are easier to buy and sell. They also do not have entry and exit load like MF. However, if one is looking for a unique strategy aimed at generating returns that beat the market, MFs can be a better way to find the right fund manager to meet their expectations.

Coming to the current market conditions, prices are ‘high’ in both domestic and global markets. We think it’s time to stay invested in great business and increase exposure to income-generating tools.

In the short term, donations are moderately bullish on ex-US developed markets, emerging markets (ex-China) as they are potential beneficiaries of a pick-up in global growth, with

With easy policy. Meanwhile, REITs are bullish given strong global growth, the potential for inflation higher than in the past, less chance of a spike in yields and greater demand for high dividend-yielding investments, presenting a benign environment.

In addition, “very bullish on commodities due to accelerating demand due to global growth, coupled with supply constraints has triggered a commodity supercycle. Structural tailwinds due to cyclical demand for electrification/clean energy and inflation protection, our positive outlook.” Let’s strengthen it,” Chanda said.