Quant's Sandeep Tandon warns of global volatility, sees select opportunities in India

Sandeep Tandon

As the world marks April 2, 2025 – dubbed “Liberation Day” in some circles – Sandeep Tandon, Chief Investment Officer at Quant Mutual Fund, sees not freedom but friction on the horizon. His latest market note paints a picture of global financial systems approaching an inflexion point, stirred not just by economic forces but political ones, especially in the US.

At the heart of this disruption is President Donald Trump, whose return to the spotlight, according to Tandon, is escalating volatility across asset classes.

“Trump’s policies may win him the title of a geopolitical grandmaster,” Tandon writes, “but history might remember him as the one who ended America’s superpower run.” He believes the U.S. economy has entered a phase of structural decline, driven by rising protectionism and a breakdown in global cooperation.

Against this backdrop, Tandon’s view is clear: U.S. equities remain at risk. While April is typically bullish for stocks, Quant’s proprietary models are flagging vulnerability in U.S. markets — especially in the tech-heavy Nasdaq, which is already seeing large-scale outflows from passive investors. “An important top is already in place,” he warns, adding that while a short-term bounce may be on the cards, medium-term risks remain elevated.

Back home, though, the story is turning more constructive. After months of correction, Indian equities seem to be finding their footing. Tandon says the ‘risk-off’ phase that began last July has played out nearly 70 percent, and selective buying opportunities are now emerging in sectors like infrastructure, hospitality, pharmaceuticals, materials, retail, and telecom.

Quant’s portfolios have responded accordingly — redeploying high cash levels into small caps while maintaining a solid base in large and mega-large caps. “We believe a trading bottom was made in late February, and the 8 percent rally in the Nifty since then supports that thesis,” he notes. However, the fund house is still watching for clearer signals, particularly from Trump’s evolving narrative, before turning fully bullish.

Meanwhile, on the macro front, Tandon flags rising risks in global currencies and commodity markets. The U.S. dollar, which had rallied strongly, is showing signs of seasonal weakness. Crude oil is expected to climb further this month, and Bitcoin — often dismissed as a speculative play — is gaining favour among risk-tolerant investors in light of geopolitical uncertainty.

Traditionally viewed as safe havens, gold and other precious metals are already at record highs. While Tandon cautions against near-term downside volatility, he maintains a constructive medium- to long-term view and recommends a meaningful allocation to the asset class.

In closing, he reassures investors that Quant’s strategies remain grounded in discipline and data. “Even as we’ve grown, we’ve kept investor concentration risk low,” he says, highlighting the importance of diversification and a resilient investor base.

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