Fund managers should respect client mandate while investing, says Raamdeo Agrawal

Public fund managers irrespective of their investment style need to factor in risk management while investing client money, says Motilal Oswal’s Raamdeo Agrawal. He was talking to the media about his learnings as an individual investor, and how different it is from the AMCs investing style. “When it comes to managing your own money you can decide how you want to manage. But clients have different ways of assessing portfolios,” he said.

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Agrawal spoke about how as an individual investor he used to “go for the kill” and take the maximum kind of risk. “It was just buy and hold and not care about the allocation or underperformance. We were fearless, and we still are. But we have understood that people do not like underperformance is not liked by people,” Agrawal explains. Hence, the role of risk management is significant.

Fund managers cannot go for an irrationally high allocation of 15 or 18 percent in a single stock. “I don't even mind having a 30 percent allocation of my portfolio in a single stock. I have that kind of appetite if I know the company well. But I don't think people have that, that is not the mandate investors are giving us. Public money is very different and we have to respect that,” he says.