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.
Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive (G) - 10.1643Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive-Dir (G) - 10.1742Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative (G) - 10.2088Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative-Dir(G) - 10.2197Motilal Oswal Dynamic Fund (Div-A) - 13.067Motilal Oswal Dynamic Fund (Div-Q) - 11.703Motilal Oswal Dynamic Fund (G) - 14.4187Motilal Oswal Dynamic Fund-Dir (Div-A) - 13.2126Motilal Oswal Dynamic Fund-Dir (Div-Q) - 11.848Motilal Oswal Dynamic Fund-Dir (G) - 15.2036Motilal Oswal Equity Hybrid Fund - Direct (G) - 14.1715Motilal Oswal Equity Hybrid Fund - Regular (G) - 13.5767Motilal Oswal Flexi Cap Fund(D) - 23.3085Motilal Oswal Flexi Cap Fund(G) - 31.0079Motilal Oswal Flexi Cap Fund-Dir(D) - 23.3068Motilal Oswal Flexi Cap Fund-Dir(G) - 33.1497Motilal Oswal Focused 25 Fund - Direct (D) - 19.0333Motilal Oswal Focused 25 Fund - Direct (G) - 32.5129Motilal Oswal Focused 25 Fund (D) - 17.1387Motilal Oswal Focused 25 Fund (G) - 29.2016Motilal Oswal Large and Midcap Fund - Dir (D) - 13.5238Motilal Oswal Large and Midcap Fund - Dir (G) - 13.5238Motilal Oswal Large and Midcap Fund (D) - 13.1546Motilal Oswal Large and Midcap Fund (G) - 13.1547Motilal Oswal Liquid Fund - Direct (Div-D) RI - 10.0077Motilal Oswal Liquid Fund - Direct (Div-F) RI - 10.0043Motilal Oswal Liquid Fund - Direct (Div-M) - 10.0413Motilal Oswal Liquid Fund - Direct (Div-Q) - 10.0434Motilal Oswal Liquid Fund - Direct (Div-W) RI - 10.0058Motilal Oswal Liquid Fund - Direct (G) - 11.0756Motilal Oswal Liquid Fund - Regular (Div-D) RI - 10.0055Motilal Oswal Liquid Fund - Regular (Div-F) RI - 10.0042Motilal Oswal Liquid Fund - Regular (Div-M) - 10.0407Motilal Oswal Liquid Fund - Regular (Div-Q) - 10.0414Motilal Oswal Liquid Fund - Regular (Div-W) RI - 10.013Motilal Oswal Liquid Fund - Regular (G) - 11.0357Motilal Oswal Long Term Equity Fund (D) - 17.227Motilal Oswal Long Term Equity Fund (G) - 21.9295Motilal Oswal Long Term Equity Fund -Dir (D) - 20.4664Motilal Oswal Long Term Equity Fund -Dir (G) - 23.8792Motilal Oswal Midcap 30 Fund (D) - 19.7366Motilal Oswal Midcap 30 Fund (G) - 32.3076Motilal Oswal Midcap 30 Fund-Dir (D) - 20.3537Motilal Oswal Midcap 30 Fund-Dir (G) - 35.3388Motilal Oswal Multi Asset Fund - Direct (G) - 10.5597Motilal Oswal Multi Asset Fund (G) - 10.4352Motilal Oswal Nasdaq 100 FOF - Direct (G) - 20.6887Motilal Oswal Nasdaq 100 FOF - Regular (G) - 20.4861Motilal Oswal Nifty 50 Index Fund - Direct (G) - 12.1384Motilal Oswal Nifty 50 Index Fund (G) - 12.0667Motilal Oswal Nifty 500 Fund - Direct (G) - 14.0409Motilal Oswal Nifty 500 Fund (G) - 13.8875Motilal Oswal Nifty Bank Index Fund - Direct (G) - 11.6363Motilal Oswal Nifty Bank Index Fund (G) - 11.51Motilal Oswal Nifty Midcap 150 Index Fund (G) - 16.1052Motilal Oswal Nifty Midcap 150 Index Fund-Dir (G) - 16.2841Motilal Oswal Nifty Next 50 Index Fund - Dir (G) - 12.5552Motilal Oswal Nifty Next 50 Index Fund (G) - 12.4384Motilal Oswal Nifty Smallcap 250 Index Fund (G) - 16.5375Motilal Oswal Nifty Smallcap 250 Index Fund-Dir(G) - 16.721Motilal Oswal S&P 500 Index Fund - Direct (G) - 13.6581Motilal Oswal S&P 500 Index Fund (G) - 13.558Motilal Oswal Ultra Short Term Fund - Dir (Div-D) - 9.8827Motilal Oswal Ultra Short Term Fund - Dir (Div-F) - 9.9034Motilal Oswal Ultra Short Term Fund - Dir (Div-M) - 9.8897Motilal Oswal Ultra Short Term Fund - Dir (Div-Q) - 10.032Motilal Oswal Ultra Short Term Fund - Dir (Div-W) - 9.8936Motilal Oswal Ultra Short Term Fund - Dir (G) - 14.0027Motilal Oswal Ultra Short Term Fund (Div-D) - 9.8566Motilal Oswal Ultra Short Term Fund (Div-F) - 9.8671Motilal Oswal Ultra Short Term Fund (Div-M) - 9.8572Motilal Oswal Ultra Short Term Fund (Div-Q) - 10.0003Motilal Oswal Ultra Short Term Fund (Div-W) - 9.8601Motilal Oswal Ultra Short Term Fund (G) - 13.5755

In your shoes

Blog Blog Details
  • January 22, 2018
  • Aashish Somaiyaa|

Dear Investors and my dear Advisor friends,

The year 2017 saw continuing discussions about the quantum of investments from domestic investors into equity mutual funds and more importantly their sustainability. Industry talking heads have been frequently asked about what has changed, what is causing the huge inflow into equity mutual funds, how long this will sustain, what can make it stop etc.?

In response we hear intelligent, rational and picture-perfect coherent analysis of regulatory changes driving adaption of capital market products, decline in inflation and positive real rates, low attractiveness of other asset classes etc. Then there are complex terms like financialization of household savings, formalization of the economy, generational change in attitudes and expectations, digitization of transactions and information availability, and last but not the least to the utter delight of career asset management professionals like me finally the realization that “MutualFundsSahiHai”! If the flow is so large the number of reasons also has to be many; how we can have just one or two reasons for a net flow > 1.5 lacs crores in CY17 alone!!!

When I meet investors, I hardly hear any of this. Stated or unstated, I hear only relative stuff – generating and holding cash, gold and real estate, fixed income – all alternatives are currently unattractive and equity returns in the last 1,2,3,…years, all times frames are linear high double digits. If just these two facts didn’t exist, all the other intelligent analysis wouldn’t matter. If equity mutual funds didn’t show great past returns, just being digitally accessible or if bank deposits were yielding 9% knowing “sahi hai” wouldn’t be “sahi enough”.

We always think in terms of the idealistic “how things should be” instead of “how things would be” or the more practical and probabilistic “how things could be”. The yawning gap between what professionals think and what investors are actually being driven by must set the agenda for all of us.
As professionals, we need to be mindful what is driving investors – relative return on alternative asset classes and past performance of equity. There are short cycles and long cycles and once in a century maybe there are super-cycles but eventually, every asset class is mean-reverting. We need to watch for anything that can make other asset classes more attractive or cause a dent in equity returns i.e. a sharp and sustained correction from the current levels. That entails setting right expectations along with a range of probabilistic outcomes - from an absolute decline of 10-15% in any window of time up to 10-15% compounded gain over next few years. Anything better is surely not ruled out in these transformational politico-economic conditions but setting expectations conservatively will hold everyone in good stead. Clear guidance is required on investing gradually as well as investing only those monies that can be spared without recourse for minimum 5 years. After all, every investment that professionals make is based on some hypothesis of corporate and economic performance and we need our investors to be with us for a time frame over which strategies can fructify. Performing well is half the job done; enabling investors to stay firmly in the saddle is the more important half.

You as an investor, on the other hand, should think like an investor without bothering about intelligent explanations of what supposedly drives you. You are definitely driven by some objective investing goals but do introspect to ensure there is no mental over-lay of the greed for more, the fear of missing out, relative comparisons with friends, influence of what the crowd at large is doing and thinking of probabilities as if they are certainties. Equity investing is always probabilistic and these mind games play havoc at market extremes.

If you have been invested for long expecting ‘teen’ returns from equities and the recent past average has been pulled way above, stay the course with your SIPs and your asset allocations but all the same, do consider taking the excess off the table. If you are under-invested and you need to correct your exposure, you cannot do it overnight; draw out a plan over time to gradually correct the asset allocation. Asset allocation is far more strategic than merely over-weighting the asset which did the best in the last couple of years by under-weighting what has not done as well.
Over the years inflation has dropped from 8-9% to 4-5%, interest rates on savings have declined from 9-12% to 6-8%. Hence, nominal returns on all investments including equity should decline though you get better inflation-adjusted returns today. The gravest of investing errors are caused chasing high returns in a low return environment. See the weighted returns on your total investment portfolio - PPF, FDs, non-term insurance, fixed income, gold, property, and equity - vis-à-vis return required for your goals. Do not make decisions based on how one component has been doing off late.

On the other hand, if markets correct by 10-20% remember that you have been waiting precisely for a correction to invest – I gather everyone is - SIPs are registered precisely because markets can fall 10-20%. Celebrate the market fall, it may temporarily look bad on your current investments but it will augur very well for the future. As the saying goes, all past corrections look like missed opportunities; except this one!

And remember what happened last month, quarter or year doesn’t determine what will happen in 2018.

Happy Investing,

Yours sincerely,
Aashish P Somaiyaa
Managing Director and CEO

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