For most average investors, investing their money in a fund with a proven historical track record is a good start. The simple answer to this lies in the current state of the stock markets, where the difference between the best performing and the worst performing fund is fairly narrow. The reason for such an outcome is the current bull run, when it becomes difficult to differentiate between the good and the not so good fund.
Thus, it becomes pertinent to check the fund manager’s ability to manage the downside, when it occurs and also their ability to manage a fund with bigger assets because of an increase in money flows into it. It is evident that many a times, short-term performance may be driven by luck, but in the long run, wealth creation has always been driven and heavily influenced by the fund manager's skills.
This week, we will be featuring interviews of eight of the finest money managers, who have repeatedly demonstrated their superior skills with consistent returns, within the defined investment framework of the funds they manage. As you evolve as a mutual fund investor, start assessing fund managers to invest with those who have proven their skills; after all as goes the saying—form is temporary, class is permanent.
Blended towards growth
What approach do you follow towards investing in the fund(s) you manage?
We invest for long-term (3-5 years). We look out for the large size of opportunity sustainable over this period, management track record to execute well and capital efficiency. Valuations relative to the stock’s own history are also important consideration while investing for the fund.
What is the one theme that you are bullish on now?
Recovery in domestic economy has remained elusive up till now and the wait has elongated due to demonetisation and GST led issues. However, this would eventually play out and that remains interesting theme from the investing perspective.
What is the one investing lesson you will never forget?
Portfolio performance is as much driven by stocks one does not choose to invest as it is from the stocks invested in.
Sohini Andani, Fund Manager, SBI Mutual Fund
