Motilal Oswal Asset Management Company Ltd. (MOAMC) is a public limited company incorporated under the Companies Act, 1956 on November 14, 2008, having its Registered Office at 10th Floor, Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai - 400025.
Motilal Oswal Asset Management Company Ltd. has been appointed as the Investment Manager to Motilal Oswal Mutual Fund by the Trustee vide Investment Management Agreement (IMA) dated May 21, 2009, executed between Motilal Oswal Trustee Company Ltd. and Motilal Oswal Asset Management Company Ltd.
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Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive (G) - 11.3846Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive-Dir (G) - 11.4181Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative (G) - 10.9654Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative-Dir(G) - 11.0015Motilal Oswal Dynamic Fund (Div-A) - 14.1399Motilal Oswal Dynamic Fund (Div-Q) - 12.664Motilal Oswal Dynamic Fund (G) - 15.6026Motilal Oswal Dynamic Fund-Dir (Div-A) - 14.3632Motilal Oswal Dynamic Fund-Dir (Div-Q) - 12.8792Motilal Oswal Dynamic Fund-Dir (G) - 16.5268Motilal Oswal Equity Hybrid Fund - Direct (G) - 16.4362Motilal Oswal Equity Hybrid Fund - Regular (G) - 15.6555Motilal Oswal Flexi Cap Fund(D) - 27.2528Motilal Oswal Flexi Cap Fund(G) - 36.2551Motilal Oswal Flexi Cap Fund-Dir(D) - 27.3405Motilal Oswal Flexi Cap Fund-Dir(G) - 38.8868Motilal Oswal Focused 25 Fund - Direct (D) - 22.5111Motilal Oswal Focused 25 Fund - Direct (G) - 38.4537Motilal Oswal Focused 25 Fund (D) - 20.1781Motilal Oswal Focused 25 Fund (G) - 34.3801Motilal Oswal Large and Midcap Fund - Dir (D) - 17.3261Motilal Oswal Large and Midcap Fund - Dir (G) - 17.3408Motilal Oswal Large and Midcap Fund (D) - 16.7609Motilal Oswal Large and Midcap Fund (G) - 16.761Motilal Oswal Liquid Fund - Direct (Div-D) RI - 10.0077Motilal Oswal Liquid Fund - Direct (Div-F) RI - 10.0043Motilal Oswal Liquid Fund - Direct (Div-M) - 10.03Motilal Oswal Liquid Fund - Direct (Div-Q) - 10.0034Motilal Oswal Liquid Fund - Direct (Div-W) RI - 10.0058Motilal Oswal Liquid Fund - Direct (G) - 11.2006Motilal Oswal Liquid Fund - Regular (Div-D) RI - 10.0055Motilal Oswal Liquid Fund - Regular (Div-F) RI - 10.0042Motilal Oswal Liquid Fund - Regular (Div-M) - 10.03Motilal Oswal Liquid Fund - Regular (Div-Q) - 10.0034Motilal Oswal Liquid Fund - Regular (Div-W) RI - 10.013Motilal Oswal Liquid Fund - Regular (G) - 11.1541Motilal Oswal Long Term Equity Fund (D) - 21.5046Motilal Oswal Long Term Equity Fund (G) - 27.3747Motilal Oswal Long Term Equity Fund -Dir (D) - 25.6699Motilal Oswal Long Term Equity Fund -Dir (G) - 29.9503Motilal Oswal Midcap 30 Fund (D) - 25.6227Motilal Oswal Midcap 30 Fund (G) - 41.9429Motilal Oswal Midcap 30 Fund-Dir (D) - 26.5417Motilal Oswal Midcap 30 Fund-Dir (G) - 46.083Motilal Oswal Multi Asset Fund - Direct (G) - 10.944Motilal Oswal Multi Asset Fund (G) - 10.7567Motilal Oswal Nasdaq 100 FOF - Direct (G) - 23.6638Motilal Oswal Nasdaq 100 FOF - Regular (G) - 23.398Motilal Oswal Nifty 50 Index Fund - Direct (G) - 14.8351Motilal Oswal Nifty 50 Index Fund (G) - 14.726Motilal Oswal Nifty 500 Fund - Direct (G) - 17.1524Motilal Oswal Nifty 500 Fund (G) - 16.925Motilal Oswal Nifty Bank Index Fund - Direct (G) - 13.701Motilal Oswal Nifty Bank Index Fund (G) - 13.5202Motilal Oswal Nifty Midcap 150 Index Fund (G) - 19.7725Motilal Oswal Nifty Midcap 150 Index Fund-Dir (G) - 20.0505Motilal Oswal Nifty Next 50 Index Fund - Dir (G) - 15.0847Motilal Oswal Nifty Next 50 Index Fund (G) - 14.9091Motilal Oswal Nifty Smallcap 250 Index Fund (G) - 20.4288Motilal Oswal Nifty Smallcap 250 Index Fund-Dir(G) - 20.7098Motilal Oswal S&P 500 Index Fund - Direct (G) - 14.865Motilal Oswal S&P 500 Index Fund (G) - 14.7245Motilal Oswal Ultra Short Term Fund - Dir (Div-D) - 10.0029Motilal Oswal Ultra Short Term Fund - Dir (Div-F) - 10.0263Motilal Oswal Ultra Short Term Fund - Dir (Div-M) - 10.0099Motilal Oswal Ultra Short Term Fund - Dir (Div-Q) - 10.1541Motilal Oswal Ultra Short Term Fund - Dir (Div-W) - 10.014Motilal Oswal Ultra Short Term Fund - Dir (G) - 14.173Motilal Oswal Ultra Short Term Fund (Div-D) - 9.9475Motilal Oswal Ultra Short Term Fund (Div-F) - 9.9582Motilal Oswal Ultra Short Term Fund (Div-M) - 9.948Motilal Oswal Ultra Short Term Fund (Div-Q) - 10.0925Motilal Oswal Ultra Short Term Fund (Div-W) - 9.951Motilal Oswal Ultra Short Term Fund (G) - 13.7006

Why predicting the future correctly won’t make you money in the stock market

Blog Blog Details
  • November 17, 2020
  • Pratik Oswal|
  • Head of Passive Funds Business

Everyone who invests in the stock market wished they could go back in time and decide which stock to buy.  One of the most overused graphs in the investment management industry is showing the growth of HDFC Bank stock price since the early 1990s. 

I also recently got a WhatsApp forward showing how if someone invested Rs 100 in Wipro stock in 1980, their investment is worth approximately 8.9 crores today with close to 2.5 lakh in annual dividends. 

Well, just like everyone - I too wish I could go back in time and short the market in March 2020 ( or sell my positions and repurchase them in April 2020). The more sophisticated investors wished they could buy credit default swaps just before the housing crisis in 2008. A few fund managers who did take a call on the financial crisis got to make a lot of money and were also featured in the movie "The Big Short." Big-name actors like Steve Carell and Ryan Gosling played their parts in the film.  

Well, the ugly truth is that you cannot change your past decisions. But let s say for the sake of argument you can predict the future and you have an idea of what the next generation of companies will look like in 20-30 years. But 20-30 years is too long a time-frame for most investors. 30 years mean someone has to wait for their retirement, and if you can predict the future, why bother to predict 30 years from now when you can predict 1 year or 2 years from now. That s a lot more fun and has the potential of making you rich quicker. 

The problem starts when multiple people like you can also accurately predict the future outcomes of a company too. If an investor thinks Nestle is an excellent buy for the next 2-3 years, so do 1000 s of other investors. The reason why a stock is valued at 50 Price earnings (PE) vs. 5 Price earnings (PE) is the investors ability to predict their future performance. 

An investor who thinks or knows Asian Paints is a good buy will buy huge quantities, so do other investors with the same philosophy. The stock prices rises to a point where investors do not see the point of buying more. Hence you are back to square one. 

The same goes for insider trading. If an investor has material non-public (insider) information, what stops other investors also to have the same information. If investors is able to take action based on insider information, then there is no point having insider information in the first place since prices have already adjusted to the information. 

So we have established that the markets tend to be efficient and forward-looking. Hence - investors who accurately predict the future may not make money. 

But then how did the guys in "Big Short" make money in the housing crisis? The answer is that they went against the crowd and turned out to be right. This is a scarce skill and requires a tremendous amount of conviction and will to play out. Almost everyone in the movie thought they were crazy to short the housing market - a market that is meant to be the safest in the world. They made a calculated prediction and won big. 

In conclusion, investors looking to make a lot of money should focus on unconventional predictions that go against the crowd. Some of the biggest and most successful investors are often laughed at multiple points in their lives but they understand the value of going against the market wisdom. 

So if you can predict the future - try using it for unconventional bets. That s the only place you ll have above-average outcomes. Good luck! 

This Article was originally published on 17thNov, 2020 in Deccan Herald

Disclaimer:

This article has been issued on the basis of internal data, publicly available information and other sources believed to be reliable which is as on date. The information contained in this document is for general purposes only and not a complete disclosure of every material fact and is not sufficient to be used for the development or implementation of an investment strategy and advice to any party. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. The statements contained herein may include statements of future expectations based on our current views and assumptions and involve risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Readers shall be fully responsible/liable for any decision taken on the basis of this article. 

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.


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