Latest news with #NiftyMidcap150Index
Economic Times
30-07-2025
- Business
- Economic Times
JioBlackRock Mutual Fund to launch 5 index NFOs next week. Check dates, other details
JioBlackRock Mutual Fund is set to launch five new index fund NFOs on August 5, closing on August 12. JioBlackRock Mutual Fund, a new entrant in the mutual fund industry, will launch five index fund NFOs next week. The new fund offer, or NFO, of these five funds will open for subscription on August 5 and will close on August 12. Further, these five funds will reopen for continuous sale and repurchase within five business days of the allotment date. Earlier this month, the fund house announced receiving a final nod from Sebi for these five index funds. Also Read | Jio BlackRock Mutual Fund receives Sebi nod for 5 index funds The five index funds are - JioBlackRock Nifty Midcap 150 Index Fund, JioBlackRock Nifty Next 50 Index Fund, JioBlackRock Nifty Smallcap 250 Index Fund, JioBlackRock Nifty 8-13 yr G-Sec Index Fund, and JioBlackRock Nifty 50 Index of these five funds, four are equity-oriented index funds, whereas one is a debt-oriented index fund. The fund house, while hinting at the upcoming launch, posted on the social media platform X that, 'Different needs. Different index funds. From large-cap stability to small-cap potential, and aiming to stabilise the portfolio with government-backed securities. Explore all five index funds, built to match the way you invest. Create an account and get investment-ready. Download JioFinance App today.' Different needs. Different index large-cap stability to small-cap potential, and aiming to stabilise portfolio with government-backed securities. Explore all five index funds, built to match the way you invest. Create an account and get investment-ready. Download… — JioBlackRock Mutual Fund (@JioBlackRockmf) July 29, 2025 The schemes will offer only direct plans, and further, the plan shall offer only a growth option. The minimum application amount for lumpsum investment in all five funds is Rs 500, and any amount thereafter. For SIP, the minimum application amount in all funds is Rs 500 and in multiples of Re 1 Nifty Midcap 150 Index Fund, JioBlackRock Nifty Next 50 Index Fund, JioBlackRock Nifty Smallcap 250 Index Fund, and JioBlackRock Nifty 50 Index Fund - the equity-oriented index funds will be managed by Tanvi Kacheria, Anand Shah, and Haresh Nifty 8-13 yr G-Sec Index Fund will be managed by Vikrant Mehta, Siddharth Deb, and Arun Nifty Midcap 150 Index Fund is an open-ended scheme replicating/ tracking the Nifty Midcap 150 Index. The investment objective of the fund is passive investment in equity and equity-related securities replicating the composition of the Nifty Midcap 150 Index, subject to tracking performance of the fund will be benchmarked against the Nifty Midcap 150 Index (TRI). The principal invested in this fund will be at 'very high risk' according to the riskometer of the fund will invest 95-100% in equity and equity-related securities of companies comprising the Nifty Midcap 150 Index and 0-5% in debt and money market instruments. Also Read | JioBlackRock Mutual Fund: New entrant in industry eyes profitable and scalable growth in India JioBlackRock Nifty Next 50 Index Fund is an open-ended scheme replicating/ tracking the Nifty Next 50 Index. The investment objective of the fund is passive investment in equity and equity-related securities replicating the composition of the Nifty Next 50 Index, subject to tracking performance of the fund will be benchmarked against Nifty Next 50 Index (TRI). The principal invested in this fund will be at 'very high risk' according to the riskometer of the fund will invest 95-100% in equity and equity related securities of companies comprising the Nifty Next 50 Index and 0-5% in debt and money market Nifty Smallcap 250 Index Fund is an open-ended scheme replicating/ tracking the Nifty Smallcap 250 Index. The investment objective of the fund is passive investment in equity and equity related securities replicating the composition of Nifty Smallcap 250 Index, subject to tracking performance of the fund will be benchmarked against Nifty Smallcap 250 Index (TRI). The principal invested in this fund will be at 'very high risk' according to the riskometer of the fund will allocate 95-100% in equity and equity related securities of companies comprising the Nifty Smallcap 250 Index and 0-5% in debt and money market Nifty 50 Index Fund is an open-ended scheme replicating/ tracking the Nifty 50 Index. The investment objective of the fund is passive investment in equity and equity-related securities replicating the composition of the Nifty 50 Index, subject to tracking performance of the fund will be benchmarked against the Nifty 50 Index (TRI). The principal invested in this fund will be at 'very high risk' according to the riskometer of the fund will allocate 95-100% in equity and equity-related securities of companies comprising the Nifty 50 Index and 0-5% in debt and money market instruments. Also Read | MF Tracker: UTI Mid Cap Fund turns Rs 10,000 SIP to nearly Rs 1.62 crore in 2 decades JioBlackRock Nifty 8-13 yr G-Sec Index Fund is an open-ended scheme replicating/ tracking the Nifty 8-13 yr G-Sec Index with a relatively high interest rate risk and relatively low credit investment objective of the fund is passive investment in gilt securities replicating the composition of Nifty 8-13 yr G-Sec Index, subject to tracking errors. The principal invested in this fund will be at 'moderate risk' according to the riskometer of the performance of the fund will be benchmarked against Nifty 8-13 yr G-Sec. The fund will allocate 95-100% in securities comprising the Nifty 8-13 yr GSec Index and 0-5% in debt and money market instruments.
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Business Standard
04-06-2025
- Business
- Business Standard
Suitable bets for cost-sensitive investors seeking market returns
The new fund offer of Tata Nifty Midcap 150 Index Fund is open. A large number of fund houses already offer midcap and smallcap index funds and exchange-traded funds (ETF s) based on popular indices such as the Nifty Midcap 150 and the Nifty Smallcap 250. Investors must understand the pros and cons of investing in passive funds in the mid- and smallcap segment before taking the plunge. Outperformance becoming harder Historically, active mid- and smallcap funds have outperformed their benchmarks over the long term. However, this trend appears to be changing. 'The latest S&P Indices Versus Active (SPIVA) report for 2024 indicates a significant decline in the outperformance of mid- and smallcap funds compared to their respective indices. This indicates that generating alpha in these segments is becoming increasingly challenging,' says Vishal Dhawan, chief financial planner, Plan Ahead Wealth Advisors. A recent analysis by Ladderup Asset Managers showed that, over the past 10 years, on average, 49 per cent of actively managed midcap funds underperformed the Nifty Midcap 150 Index. In passive funds, investors need not constantly monitor the fund manager's performance. 'They do not have to worry about the fund underperforming relative to the market,' says Niranjan Avasthi, senior vice-president, Edelweiss Mutual Fund. They can stay invested in the same fund for long and focus on their asset allocation. 'These funds enable new investors, those without an advisor, or those short on time and expertise to participate in the market effortlessly,' says Ariahnt Bardia, chief investment officer and founder, Valtrust. Raghvendra Nath, managing director, Ladderup Asset Managers, highlights that key person risk is eliminated in these funds. In active funds, if a star fund manager departs, there is the risk of the fund's performance getting affected. Chintan Haria, principal – investment strategy, ICICI Prudential Mutual Fund, points out that investors can earn market-equivalent returns at a low cost. Passive funds stay true to their mandate. 'When investors choose a midcap or a smallcap passive fund, 100 per cent of their investment is made in the chosen category. It will not have any investment in largecap or smallcap stocks,' says Arun Sundaresan, head – ETF, Nippon Life India Asset Management. The fund's strategy remains unchanged throughout its life. By investing in a diversified index, investors reduce their risk of overexposure to a single stock or sector. Passive funds always maintain full exposure to the market, with no attempt to exit or take cash calls during downturns. 'They do not try to time the market. This can work well over the longer term,' says Sundaresan. Risk of higher tracking error Liquidity in mid- and smallcap stocks is lower than in largecaps. 'This can lead to higher tracking error and tracking difference for passive funds in these segments, and impact the investor's actual returns compared to the index,' says Avasthi. Haria says that smallcap indices often include illiquid stocks, leading to wider bid-ask spreads and pricing gaps in ETFs. Mid- and smallcap segments are more volatile than largecap. During sharp corrections, these funds decline in line with their index and offer no downside protection. 'Without an active fund manager to course-correct or take cash calls, drawdowns can be deeper when using an index fund or ETF for the midcap and smallcap category,' says Haria. Passive fund managers are bound to the index. 'Businesses that are not profitable may get purchased by these funds simply because they are part of the index,' says Dhawan. Bardia points out that these funds can at times include companies with poor fundamentals or governance. Indices rebalance at set intervals. 'The index may continue to hold stocks that are driving down the portfolio's return. Active funds, where the fund manager actively tracks the performance of his portfolio stocks, can avoid this,' says Nath. Who should go for them? Passive funds suit long-term investors seeking low fees and independence from fund manager calls. 'It is ideal for disciplined systematic investment plan (SIP) investors with a 7–10 year horizon,' says Haria. Dhawan says investors comfortable with market returns in the mid- and smallcap segment and sensitive to cost would find passive funds appealing. Nath adds that investors who prefer simplicity, are new to investing, or lack the knowledge or guidance to choose active funds may go for these funds. Who should avoid them? Investors seeking downside protection or short-term alpha should consider active funds. 'Tactical investors may struggle due to the illiquidity of ETFs in these segments,' says Haria. Investors looking for alpha generation may prefer active funds. 'They must, however, be prepared for the risk that in the pursuit of alpha generation, mid- and smallcap active funds may actually underperform the indices,' says Dhawan. These funds may also not suit investors with low risk tolerance or short investment horizons. How to select an index fund or ETF Before investing, Haria advises checking tracking error, expense ratio and assets under management (AUM). 'High tracking error defeats the purpose of passive investing,' he says. In ETFs, trading volume is an important factor. 'Higher the trading volume of an ETF, lower would be the impact cost of a transaction. Check for trading volume data and impact cost details available on the websites of stock exchanges,' says Sundaresan. Bardia suggests selecting funds that offer efficient replication, have low costs, and are managed by fund houses with strong execution capability in the passive space.
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Business Standard
02-06-2025
- Business
- Business Standard
New to Midcaps? Tata's Passive fund offers low-cost, diversified exposure
Tata Asset Management on Tuesday launched a new passive fund that gives investors a low-cost way to ride the midcap growth wave. The Tata Nifty Midcap 150 Index Fund, open from June 2 to June 16, 2025, tracks a diversified portfolio of mid-sized companies that are rapidly gaining market share across sectors. What is it? This is a passive index fund that aims to mirror the performance of the Nifty Midcap 150 Index, which includes 150 mid-sized companies across 20 sectors. These are businesses that are not yet giants like large caps but have shown consistent growth and potential. Key dates: NFO (New Fund Offer) period: June 2 to June 16, 2025 Minimum investment: ₹5,000 (and in multiples of ₹1 thereafter) Exit load: 0.25% if redeemed within 15 days Why Midcaps Matter to You Midcap companies often lie at the heart of India's economic momentum — they're agile, growth-oriented, and often industry leaders in the making. Historically, midcaps have outperformed both large caps and small caps: 1-year rolling return: Midcap index delivered 21.89%, vs 16.37% by Nifty 50 3-year rolling return: Midcaps returned 15.8%, vs 12.38% by large cap (Source: NSE, ICRA-MFI, Apr 2005–Apr 2025) What you are investing in: This open-ended index fund mirrors the Nifty Midcap 150 Total Return Index (TRI), offering exposure to 150 mid-sized companies ranked 101st to 250th by market cap in the Nifty 500 universe. Fund Managers: Kapil Menon & Rakesh Prajapati (combined 40+ years of experience) Why choose this fund? Diversification: The fund offers exposure to 74 industries, including those not represented in large-cap indices — like chemicals, realty, capital goods, and more. Growth Potential: Over the last five years, 17 midcap companies graduated to the large-cap category, showing the potential for wealth creation. Lower Costs: Being passively managed, it avoids the higher fees of actively managed funds. Risk-Spreading: Instead of betting on one stock, your money is spread across 150 companies. Plus, it avoids stock-specific risks. Who should invest? Long-term investors looking to benefit from India's evolving economic landscape Investors who prefer low-cost, rule-based investing Those seeking diversification beyond blue-chip stocks SIP (Systematic Investment Plan) investors aiming for compounded returns over 5–10 years Point to note: Midcap investments come with higher short-term volatility. Stay invested long enough to ride out the ups and downs. 'Midcaps represent India's growth frontier. Through the Tata Nifty Midcap 150 Index Fund, investors can get access to potential growth sectors and companies that are integral to India's next phase of economic expansion,' said Anand Vardarajan, Chief Business Officer, Tata Asset Management. 'The fund is suitable for long-term investors seeking a blend of growth and diversification, backed by discipline of passive investing.' The Nifty Midcap 150 index comprises companies across 20 sectors and 74 basic industries. "Notably, 39 industries present in the midcap space but absent in the large cap space, account for over 40% of the total weight of the index, highlighting the unique diversification benefit that the segment offers. Nifty 100 is considered as a universe for large caps and Nifty Midcap 150 is considered as universe for mid-caps). Over the past five years, 17 companies from the midcap segment have transitioned into large caps, illustrating the segment's capacity to aim for wealth creation," the company said in a release. Why Midcaps Make Sense in 2025 While large caps offer stability, midcaps provide growth. These are companies typically valued between ₹33,000 crore and ₹1 lakh crore—big enough to be established, but small enough to grow rapidly. Key insights from the fund presentation: Midcaps have historically outpaced GDP growth, with their market cap-to-GDP ratio doubling in the last 10 years. They are less sensitive to foreign investor outflows compared to large caps, as promoter holding is higher (~55%). In the last 5 years, 17 midcap companies became large caps, showcasing the segment's transition power.
Mint
02-05-2025
- Business
- Mint
Your Questions Answered: I want to invest in midcap indices. Please elaborate on the Nifty Midcap 50 Index?
Arindam Banerjee, Salt Lake City, Kolkata Investing in mutual funds has become a popular choice for individuals seeking to grow their wealth while diversifying their portfolios. Among the various options available, mutual funds that track the Nifty 50 Midcap Index have gained significant attention. These funds offer exposure to midcap companies, which are often considered the sweet spot between stability and growth potential. Let's dive into the details of these funds and why they might be worth considering. The Nifty Midcap 50 Index is a benchmark that represents the performance of 50 midcap companies listed on the National Stock Exchange of India. These companies are ranked between the top 101st and 150th in terms of market capitalisation. The index is designed to capture the growth potential of mid-sized companies that are well-established but still have room to expand. Nifty Midcap 50 Index includes the top 50 companies from the Nifty Midcap 150 Index, based on full market capitalisation. These companies are carefully selected to ensure the index accurately reflects the midcap segment of the market. Below, we have mentioned the key criteria to be part of Nifty Midcap 50 Index. Market capitalisation: Companies must rank among the top 50 in terms of full market capitalisation within the Nifty Midcap 150 Index. Preference is given to stocks that have derivative contracts available on the NSE. Liquidity: The liquidity of a stock is a critical factor. Companies must demonstrate sufficient trading activity to ensure that their inclusion does not hinder the index's performance. The total traded value of all index constituents over the last six months is considered. Free-float market capitalisation: The index uses free-float market capitalisation, which excludes shares held by promoters and other strategic investors, to determine the weight of each stock. Sector representation: The index aims to provide a balanced representation of various sectors within the midcap segment, ensuring diversification. Corporate governance: Companies must adhere to high standards of corporate governance and comply with regulatory requirements. Periodic review and rebalancing: The Nifty Midcap 50 Index undergoes periodic reviews to ensure it remains representative of the midcap segment. During these reviews, companies that no longer meet the eligibility criteria are replaced. New companies that fulfil the criteria are included. Adjustments are made to account for corporate actions such as mergers, acquisitions, and spin-offs. Mutual funds tracking the Nifty Midcap 50 Index are designed to replicate the performance of the index, providing exposure to a diverse range of midcap stocks. Below, we have mentioned the key advantages of investing in these funds and why they are worth considering for your portfolio. Access to high-growth companies: Midcap companies, often referred to as the 'sweet spot' of investing, lie between largecap giants and smaller firms. They are established enough to offer stability but still have significant growth potential. Mutual funds tracking the Nifty Midcap 50 Index grant investors access to these dynamic companies, which can be a great addition to a growth-oriented portfolio. Diversification benefits: The Nifty Midcap 50 Index includes 50 midcap companies across various sectors. By investing in a fund that tracks this index, you can benefit from diversification, spreading risk across industries and reducing the impact of individual stock volatility. Cost efficiency: Mutual funds tracking indices like the Nifty Midcap 50 Index are often passively managed. They aim to mirror the index's performance rather than actively choosing stocks. As a result, these funds tend to have lower expense ratios than actively managed funds, making them a more cost-effective option for investors. Professional management: Even though these funds follow an index, professional fund managers handle the investments. They ensure the portfolio aligns with the index and adjust as needed, such as rebalancing the portfolio during index changes or corporate actions. Transparency: Index funds are known for their transparency. Since they follow a specific benchmark, investors can easily understand the composition and performance of the fund. This clarity helps investors make informed decisions and track their investments effectively. Consistent performance: By tracking the Nifty Midcap 50 Index, these mutual funds aim to replicate the index's performance. Historically, midcap indices have delivered robust returns over the long term, making them a reliable choice for investors seeking consistent growth. Ideal for long-term investing: Midcap funds are well-suited for long-term investors. Over time, the inherent growth potential of mid-sized companies can translate into significant returns, especially when compounded. Investing in these funds aligns with a long-term wealth creation strategy. Reduced volatility compared to smallcaps: While midcap stocks are more volatile than largecaps, they are less risky compared to smallcap stocks. This middle ground makes mutual fund tracking the Nifty Midcap 50 Index appealing to investors who want growth with moderate risk levels. While mutual funds tracking the Nifty Midcap 50 Index offer several advantages, they are not without their drawbacks. Understanding these cons is crucial for investors to make informed decisions and align their investments with their financial goals and risk tolerance. Below, we have listed the key risk associated with investing in mutual funds tracking Nifty Midcap 50 Index: Higher volatility: Midcap stocks are more sensitive to market fluctuations compared to largecap stocks. This heightened volatility can lead to sharper price swings, making these funds riskier for investors who prefer stability in their portfolios. Economic sensitivity: Midcap companies often rely heavily on domestic demand and have limited resources compared to largecap firms. This makes them more vulnerable to economic downturns, which can adversely affect the performance of mutual funds tracking the index. Limited downside protection: Unlike actively managed funds, index funds do not employ strategies to mitigate losses during market downturns. This passive approach means that investors are fully exposed to the index's performance, whether positive or negative. Sector concentration risks: While the Nifty Midcap 50 Index provides diversification, certain sectors may dominate the index. This concentration can increase the risk associated with specific industries, especially during periods of sector-specific challenges. Suitability for long-term investors: Due to the inherent volatility and economic sensitivity of midcap stocks, these funds are better suited for long-term investors who can withstand short-term fluctuations. Short-term investors may find the risk levels unappealing. The Nifty Midcap indices are benchmarks designed to represent the performance of midcap companies listed on the NSE. While both the Nifty Midcap 100 Index and the Nifty Midcap 50 Index focus on midcap stocks, they differ in composition, selection criteria, and purpose. Let's explore these differences in detail. Nifty Midcap 100 Index: This index comprises the top 100 midcap companies ranked between 101st and 200th in terms of market capitalisation. It provides a broader representation of the midcap segment. Nifty Midcap 50 Index: This index includes the top 50 midcap companies selected from the Nifty Midcap 150 Index based on liquidity and market capitalisation. It offers a more focused representation of midcap stocks. Nifty Midcap 100 Index: With a larger pool of companies, this index provides broader sector representation, capturing the performance of midcap stocks across multiple industries. Nifty Midcap 50 Index: Due to its smaller size, this index may have limited sector representation compared to the Nifty Midcap 100 Index. Nifty Midcap 100 Index: The broader composition of this index may result in lower volatility compared to the Nifty Midcap 50 Index. Nifty Midcap 50 Index: The focus on fewer stocks can lead to higher volatility, making it more sensitive to market fluctuations. Nifty Midcap 100 Index: Ideal for investors seeking diversified exposure to midcap stocks and long-term growth potential. Nifty Midcap 50 Index: Suitable for traders and investors looking for liquidity and actively traded stocks, often used for derivative trading. Investing in index funds tracking the Nifty Midcap 50 Index is a popular choice for individuals seeking exposure to midcap companies. However, understanding the taxation rules associated with these investments is essential for effective financial planning. Below, we delve into the tax implications of such investments in detail. Capital gains tax is applicable when you redeem your index fund units. The tax treatment depends on the holding period: Short-term capital gains (STCG): If the units are held for less than 12 months, the gains are classified as short-term capital gains. STCG is taxed at a rate of 20% under Section 111A of the Income Tax Act. Long-term capital gains (LTCG): If the units are held for more than 12 months, the gains are classified as long-term capital gains. LTCG is taxed at a rate of 12.5% for gains exceeding ₹ 1.25 lakh in a financial year. Investing in mutual funds tracking the Nifty Midcap 50 Index can be a rewarding venture, but it requires careful consideration and research. These funds provide exposure to midcap companies, which are known for their growth potential and moderate risk levels. Below, we outline the key factors investors should evaluate before investing. 1. Investment goals and horizon: Before investing, define your financial objectives and investment horizon. Are you looking for long-term capital appreciation, or do you have short-term financial goals? Midcap funds are best suited for long-term investors who can withstand market fluctuations and benefit from the growth potential of midcap stocks. 2. Risk tolerance: Assess your risk appetite. Midcap stocks are more volatile than largecap stocks, which means they can experience significant price swings. Ensure that your risk tolerance aligns with the inherent volatility of these funds. 3. Fund performance: Evaluate the historical performance of the mutual fund. Look for consistency in returns over different timeframes (1 year, 3 years, 5 years) and compare the fund's performance to its benchmark index and peer group. Keep in mind that past performance does not guarantee future results. 4. Expense ratio: The expense ratio is the annual fee charged by the fund for managing your investment. Lower expense ratios are preferable, as they reduce the cost of investment and improve net returns. Compare the expense ratios of different funds tracking the Nifty Midcap 50 index. 5. Tracking error: Tracking error measures how closely the fund replicates the performance of the Nifty Midcap 50 Index. Lower tracking errors indicate better alignment with the index. Choose funds with minimal tracking errors to ensure accurate representation of the index. 6. Fund manager expertise: Although index funds are passively managed, the fund manager plays a crucial role in maintaining the portfolio and executing trades. Research the fund manager's track record and expertise in managing index funds. 7. Liquidity: Check the liquidity of the fund. Funds with higher asset sizes tend to have better liquidity, making it easier to buy or sell units without impacting the fund's performance. 8. Tax implications: Understand the tax treatment of your investment. Capital gains tax is applicable when you redeem your units, and dividends are taxed as per your income tax slab. Familiarise yourself with these rules to optimise your post-tax returns. 9. Sector allocation: Analyse the sector allocation of the fund. Ensure that the fund provides balanced exposure to various industries within the midcap segment, reducing the risk of sector-specific challenges. 10. Investment mode: Decide whether to invest through a lump sum or a Systematic Investment Plan (SIP). SIPs allow you to invest smaller amounts at regular intervals, reducing the impact of market volatility and promoting disciplined investing. As of March 28, 2025, the Nifty Midcap 50 Index has given a five-year compounded annual return of 36.74%. On the other hand, as of March 28, 2025 Nifty Midcap 100 Index has given a five-year compounded annual return of 34.58%. Please see below the top two index mutual funds tracking the Nifty Midcap 50 Index: Name Expense Ratio 1 Year Return Axis Nifty Midcap 50 Index 0.26% 8.48% Kotak Nifty Midcap 50 Index Fund 0.25% N.A. Source: AMFI website. All data as of 15 April 2025 Note: Past performance is not an indication of future returns. Mutual funds tracking the Nifty Midcap 50 Index offer a unique opportunity to invest in mid-sized companies with significant growth potential. They combine the benefits of diversification, professional management, and cost-efficiency, making them an attractive option for investors. However, as with any investment, it's crucial to conduct thorough research and consult with a financial advisor to align your investments with your financial goals. Disclaimer: Investing in mutual funds involves risks, including potential loss of principal. Please consult with a financial advisor before making any investment decisions. Kuvera is a free direct mutual fund investing platform. First Published: 2 May 2025, 12:10 PM IST
Economic Times
01-05-2025
- Business
- Economic Times
ETMarkets PMS Talk: Growth, margin expansion, and valuation - the 3 pillars behind Purnartha's stock selection
In this edition of ETMarkets PMS Talk, we catch up with Saurabh Pathak, Head - Investment Counsellor at Purnartha PMS, to understand the driving forces behind the firm's consistent outperformance across market cycles. ADVERTISEMENT At the heart of Purnartha's investment approach lies a disciplined framework built on three core pillars — Growth, Margin Expansion, and Valuation. Pathak walks us through how this philosophy shapes stock selection, fund strategy, and risk management, particularly in volatile times. He also sheds light on the positioning of their flagship Dynamic Midcap Strategy, sectoral preferences, and how investors are reacting to today's global uncertainties. Edited Excerpts – Q) Thanks for taking the time out. Please take us through the performance of Purnartha funds for FY25 and which fund stood out and why? A) Fund Performance Overview:All our equity funds have delivered strong performance over the one-year time frame, while our concentrated schemes have also outperformed over the two-year period. This consistent performance is primarily attributed to our strict adherence to core investment philosophies and timely decision-making. ADVERTISEMENT • The outperformance of Pratham & Vision strategies was driven by strong stock selection, while the success of the Dynamic Midcap strategy was the result of a proactive sector allocation approach combined with investments in companies boasting healthy order books and timely execution.• We remain highly confident in our ability to continue delivering outperformance relative to benchmarks across all schemes going forward. ADVERTISEMENT Q) What is the primary investment objective of the Purnartha Dynamic Midcap Strategy?A) Our Dynamic Midcap Funds are designed to capitalize on India's long-term, multi-decade growth story, aiming to generate an alpha of 3%–4% over the Nifty Midcap 150 Index. ADVERTISEMENT The strategy is thoughtfully crafted to navigate market uncertainties by blending both Growth and Value investing styles, resulting in a balanced and resilient portfolio.Q) What are the key sectors in which the Purnartha Dynamic Midcap Strategy is invested, and what is the sector-wise exposure as a percentage of net assets? ADVERTISEMENT A) Currently, our portfolio is diversified across approximately 10 sectors, with strategic allocations in key areas such as Financials (~18%), Healthcare (~10%), Capital Goods (~9%), FMCG and IT (each ~8%).We've aligned our sector weights with the benchmark. For example- we have increased our exposure to defensive themes in Nov/ Dec 2024 while trimming our allocation to Capital Goods in response to evolving market dynamics. Q) Small & midcaps was one space which was beaten down badly in the last few months. How should one look at this theme for FY26? A) Mid and Small Caps have faced headwinds over the past six months, primarily driven by stretched valuations, concerns around the US elections, and tariff-related response, we have adjusted our portfolio stance—reducing small cap exposure from 30% to approximately 16%, while maintaining our mid cap allocation in the range of 45%–49%.While we remain structurally positive on the small and midcap segments, our current focus is on selective opportunities within continue to invest in fundamentally strong companies with 2/3 years of revenue visibility, robust balance sheets, healthy cash flows, and the ability to self-fund future capex without relying on debt. Q) What are the key sectors in which the Purnartha Dynamic Midcap Strategy is invested? A) We continue to maintain a well-diversified portfolio across 9–10 sectors, with significant allocations in key areas such as Banking & Financials, Healthcare, and Capital Goods. Q) How do you evaluate companies for investment across different funds? A) Purnartha Pratham & Vision Strategy: Our investment philosophy is based on three key drivers — Growth, Margin Expansion, and Valuation. Companies that meet any two or more of these criteria are subjected to a detailed research and screening process before being included in the portfolio. The primary objective is to identify businesses capable of sustaining multi-year growth. • Dynamic Midcap Strategy: This strategy follows the GSM framework — Growth, Strategic Investment, and Margin Expansion. Companies that meet any one of these parameters are considered for further Fund Manager aims to maintain exposure to all three pillars (GSM), adjusting allocations dynamically based on the prevailing market environment and sentiment. Q) What is your take on markets for FY26 and did you also tweak your strategy to counter tariff related volatility in the system? A) Dynamic Midcap Strategy Outlook:Our Dynamic Midcap Fund operates under the GSM Philosophy (Growth, Strategic Investment, and Margin Expansion). This approach enables the fund to maintain a balance between growth and value style investments within the same portfolio, providing stability even during periods of market response to current market conditions, we have increased allocation toward defensive sectors and India-focused themes, while using cash as a tactical tool to seize opportunities arising from market fluctuations.• Market Outlook (FY26):For FY26, we anticipate that the equity asset class will deliver moderate returns compared to the strong gains of the past couple of years. However, we continue to expect corporate profit growth of 10–12%, which aligns with nominal GDP growth projections. Q) How do you manage risk across different funds? A) Purnartha Pratham & Vision Strategy:o A significant portion of the portfolio is allocated to large-cap companies, ensuring liquidity at all times and providing opportunities to capitalize on market three-driver approach — Growth, Margin Expansion, and Valuation — guides the portfolio construction and allocation. We manage idiosyncratic risk by adhering to strict investment rules and executing a disciplined exit strategy whenever initial investment assumptions are no longer valid.• Dynamic Midcap Strategy:o Mandatory trimming of position where a stock breaches 12% of the current portfolio valueo Stock allocation is an indication of risk-return tradeoffo Exposure to a wider spectrum of sectors/sub-industrieso Managing exposure to raw material (commodities), geographies, size, styleo While debt is allowed till 0.5x to equity – in the current 'tariff uncertainty' ~60% of the portfolio is allocated to net cash companies.• Purnartha One strategy:o Risk management is an inherent feature of the Purnartha One strategy, achieved through diversified exposure across different asset classes and timely portfolio rebalancing.o Our approach is further strengthened by the VMS framework — focusing on Valuation, Macro Outlook, and Sentiment. This three-factor framework helps to actively hedge risks and maintain portfolio stability across varying market conditions. Q) There is too much chatter on Gold – how do you see this asset class for investment? A) Gold Investment Strategy — Purnartha One:As part of our Multi-Asset Strategy under Purnartha One, we maintain an allocation to Gold in the range of 4–6%. We view Gold primarily as a crisis hedge, rather than a high-return asset.• Given the ongoing global economic uncertainties, demand for Gold is expected to remain strong. We consistently recommend that investors allocate a portion of their portfolio to Gold at all times. The objective is not to maximize returns fromGold, but to provide a cushion and enhance portfolio resilience during periods of heightened volatility and uncertainty. Q) What are the queries that you have been getting from your clients? A) Investor Sentiment in Current Times:Today's investors find themselves at a crossroads — concerned about global uncertainties such as tariff wars, yet confident in India's long-term economic growth story. While this duality has not deterred participation in equities, it has led to a more cautious investment approach, limiting aggressive segment of investors remains confused, struggling to choose between different investment styles, philosophies, and asset classes available in the market. Despite the broader index recovery, many remain apprehensive, preventing them from making decisive investors often find it challenging to identify investment solutions that align with their goals and provide timely results. Although there is a growing urgency to create passive income through investing, prevailing macro and microeconomic fears cloud judgment, often leading to panic-driven decisions. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
