Using a two-pronged strategy, “The Shriram Multi Asset Allocation Fund provides investors with high returns for their risk tolerance. Its ‘risk parity’ between equities, bonds, and gold is designed to reduce risk while increasing returns for investors. Second, we use our Enhanced Quantamental Investment (EQI) model, which combines quantitative and fundamental analysis, to construct a risk-adjusted equity portfolio that is designed to provide alpha (returns in excess of the benchmark) on a consistent basis for the equity allocation. Low volatility (stable returns), momentum (growing returns), and low valuation (at the correct price) are the three parameters we use, and they have produced excellent outcomes in both historical and hypothetical scenarios. “We are confident that this single fund will find favour with our investors,” said Kartik L. Jain, president and chief executive officer of Shriram Asset Management Company. 

Shriram multi-asset allocation fund Allocation

The equity portion of the fund’s assets will range from 65% to 80%, and it will hold between 30 and 40 stocks selected using Shriram AMC’s Enhanced Quantamental Investment (EQI) model.  Gold and silver exchange-traded funds (ETFs) would receive 10% to 25% of the fund’s assets, with the option of up to 10% being invested in real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) to mitigate credit risk.

Also Read : Dividend Stocks: Reliance Industries, Oil India, ICICI Securities others to trade ex-dividend next week; check full list

Shriram multi-asset allocation fund: Investment Options

Systematic Investment Plans (SIPs), top-ups, and Systematic Transfer Plans (STPs) from liquid or overnight funds let investors to routinely invest in this fund to help them achieve their financial and family planning objectives. Investing in a lump sum requires a minimum of 5,000, while SIPs require only 1,000 each month or 3,000 per quarter. There is zero commitment required.

Last year, Shriram Group recruited Mission1 Investments LLC, a mutual fund business based in the United States, to help revitalise the company’s mutual fund operations. As a result, Shriram AMC is now able to offer a wider variety of investment options to its clientele. ‘Performance, Products, and Placement’ is where the AMC is putting its attention as it lays the groundwork for long-term success.

The post Mutual Fund: Shriram AMC launches Shriram multi-asset allocation fund for long-term wealth creation. Key things to know appeared first on Republic Aeon.

The fund house that was sponsored by Union Bank of India and Japanese major Daiichi Life was unable to reach anywhere in the 43-player scattered industry that controls more than Rs 43 lakh crore of public money in its over 11 years of operations. Despite having 22 funds (21 open-ended and one close-ended funds), the fund house had 21 open-ended funds and one close-ended fund.

A little more than 9 crores worth of assets under management were spread among 4.96 lakh live folios and 21 cities by the end of the fiscal year that ended in March 2023. In May of 2018, Daiichi acquired a 39.64 percent share in the MF.

However, in terms of its presence in smaller towns, Union Mutual Fund does quite well. 32% of the AUM comes in from the B30 (beyond top 30) cities, while the remaining 88% comes from the T30 (top 30) cities.

Our total assets under management (AUM) reached 10,700 crore rupees in June, up from 9,853 crore rupees in March 2023. We expect to open a major theme fund within the next month, and our goal is to collect at least Rs. 500 crore from that fund during the NFO period, which will allow us to bring the AUM up to about Rs. 15,000 crore by the following March. Naturally, a great deal will be determined by the market,” the chief executive G Pradeepkumar said in an interview with PTI.

When the public sector fund house was dealing with the Unit 64 problem that led to the bailout of the scheme in the late 1990s, Pradeepkumar was already working for UTI and was the first employee of the fund house. He began his career in the financial industry with UTI and has been with the fund house since its inception.

Pradeepkumar admitted that they were unable to grow over the course of all these years, and he stated that the poor performance was mostly due to the fact that their initial international partner, KBC of Belgium, was opposed to any third-party sales channels, which limited sales to only the Union Bank branches.

However, that is in the past. Since May 2018, when Daiichi Life purchased a 39.64% interest, we currently have a large number of banks as distribution partners. As a consequence of this, only twenty percent of sales come through branches of Union Bank anymore, according to Pradeepkumar, who also mentioned that the fund house has over seven thousand distributors and over fifteen thousand people who are empanelled with us now.

“In point of fact, we have more than doubled our AUM since Daiichi entered the market. In March 2018, the AUM was only Rs 4,500 crore, but by March 2023, it had increased to Rs 9,853 crore. He went on to say that we are optimistic about continuing to build on this momentum in the future.

According to him, as much as Rs 7,500 crore is invested in equity (Rs 5,500 crore is invested only in equity) and hybrid funds, and the remaining Rs 5,500 crore is invested in debt (exclusively in bonds issued by the Central government and corporations, and not in bonds issued by state governments). In addition, it does not invest in gold exchange-traded funds (ETFs) or any other passive funds and does not currently have any plans to start doing so.

But Pradeepkumar asserted that despite having a low AUM, they are among the leaders when it comes to consistently above average returns. He cited the company’s first fund, a flexicap fund that had Rs. 1,500 crore in AUM and had provided a compounded average return of 24.7% since 2018, as well as the company’s tax saver fund that had Rs. 635 crore in AUM and had provided a return of 25.6%.

According to him, the business has been profitable for the previous five years, and it finished the fiscal year FY23 with a net income of Rs 13 crore, which was derived from revenues of Rs 55 crore.

Although we have the goal of expanding our business, we will not do so at the expense of our profitability. He stated that our primary focus is, and will continue to be, on growth that is both sustainable and profitable rather than on growth that is faster at any cost.

Pradeepkumar further stated that the company is considering entering the AIF arena, and he stated that the company intends to soon seek Sebi registration for the same. He also stated that the company hopes to launch it during this current fiscal year. Already, we are Daichi’s fund manager for his offshore investment vehicle.

Read Also : Expedite loan sanction, disbursement for projects under Rs 10,000 crore UIDF: Financial services secretary

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