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Combining diversification with high conviction ideas

February 25, 2022 / 03:10 PM IST

The growth of mutual funds in India and the proliferation of newer and more sophisticated products have brought about a shift in the norms of fund management. SBI Mutual Fund have made further changes to the dynamics of fund management, by adopting a sophisticated and modern approach to picking stocks. More details about this innovative approach were discussed during a special broadcast of the SBI Mutual Fund and Moneycontrol present 'MF Masterclass', which featured Sumaira Abidi in conversation with one of India's top equity fund management teams from SBI Mutual Fund, including R Srinivasan, CIO - Equity, Ruchit Mehta, Head - Research, Sukanya Ghosh, Quant Research Analyst, Priyanka Dhingra, ESG Analyst, Saurabh Pant, Fund Manager & Consumer Goods Analyst, and Nidhi Chawla, Fund Manager & Infrastructure Analyst.

What immediately sets SBI Mutual Fund's approach to fund management apart is the expanded role of analysts in this fund. By R Srinivasan's own admission, the fund is shaped to put into action "the best or high conviction ideas of the analyst team". Beyond the obvious attention given to portfolio managers, R Srinivasan added, "SBI Mutual Fund has always been an analyst-centric fund house." While disagreements and cognitive dissonance are common within such sprawling fund management teams, it's the collaborative work culture and collective ownership of ideas that facilitates their success. Speaking from an analyst's point of view, Sukanya Ghosh noted the change it has brought. "Paper portfolios don't bring accountability in the true sense. In a live portfolio, it's a totally different ball game.”

And it's a game SBI Mutual Fund's savvy fund management team seems ready to play. Their fund management protocol not only strips away biases and ego from investment decisions, but it also works to distil out good ideas through a well-defined investment process. Such clear-cut ideals give rise to a strong conviction among analysts, and the long-term vision that is at foundation of every successful fund house.

To learn more about the challenges of managing a multi cap fund, watch the full discussion here.

Moneycontrol journalists were not involved in the creation of the article

Tags: #Features
first published: Feb 25, 2022 03:10 pm