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  EVI gives investors objective guidance on where to invest now
ICICI Pru’s multi-factor based Equity Valuation Index is currently pointing investors towards dynamic asset allocation funds, says Chintan as he takes us through the composition of EVI and the guidance it gives at different EVI levels. I Pru BAF – the industry leader in the dynamic asset allocation space has acquitted itself very well indeed through market cycles, and most importantly, scores high on delivering against investor expectations of healthy returns with no negative surprises in any 3 year holding period.

4 strategies to deal with the BIG risk in credit funds
Amit believes credit funds will grow very significantly in the coming years as companies increasingly turn to the market for borrowings and savers increasingly turn towards funds for investments. All the more reason that we need to understand how fund managers are dealing with the biggest risk in credit funds – liquidity risk – which stems from the fact that the underlying portfolio is nowhere as liquid as the product offered to investors. Amit spells out 4 strategies that his team employs to effectively deal with this risk.

  Focused new fund from champion alpha generator
Anand’s team at BNP Paribas has earned for itself a strong reputation as stellar alpha generators, which is why a “best ideas” Focused Fund offering from them evokes much interest among distributors and investors.

Timely calls + nimble action = great value for investors
ICICI Prudential has built a reputation around giving timely equity thematic calls to distributors, which many have acted on and generated value for investors. Problem is actions are not as nimble and quick as desired in many cases. That’s where Raghav says their PMS Multi-Manager Portfolio can be an attractive proposition, as the product acts swiftly on the fund house’s calls to deliver significant value to its investors.

  Host of global events to worry about
In this month’s market outlook note, Navneet gives us a great overview of a wide cross section of global factors impacting markets – including central bank action, geo-politics, climate change, economic theories getting challenged and monetary policies that perhaps should get challenged.

US market looking lot more vulnerable than ours
Corporate profits to GDP in India is at a 14 year low (lowest since 2003); US ROEs are trending at all time highs. Market cap to GDP in India is nowhere close to its 2008 levels; its at the 2008 levels today in the US. PE multiples in both markets are above historical average – in India, on a highly supressed earnings denominator, in US, on a buoyant earnings denominator. Interest rates are set on a gradual increasing slope in the US, we are nowhere near a rate hike cycle in India.

  For immediate periodic cash flows, here’s a solution
Principal MF’s range of hybrid funds – Balanced, Smart Equity and Equity Savings – have now got a Regular Withdrawal Plan which allows upto 24% withdrawal annually of the initial investment amount, without exit loads – making them useful propositions where periodic cash flows need to be planned, without any time lags.

Avoiding froth to create long term value
ICICI Prudential Value Discovery Fund is going through a period of underperformance in a market that’s hitting new highs – an action replay of what happened to it in 2007. Investors who want to make the most of a bull phase in the near term are likely to be disappointed, but Mrinal argues that those who have patience and stay invested, should be more than adequately compensated over the market cycle, when the fund’s cautious value oriented stance stands it in good stead at a time when froth evaporates, taking down many momentum plays with it.

  Playing the biggest theme in India and Asia
Mirae Asset Great Consumer Fund is a highly focused play on the biggest theme in India and Asia – the burgeoning purchasing power of billions of Asians, with 75% focused on India and 25% feeding into an overseas fund that plays the Asian consumption theme.

A granular look at themes for the coming years
As markets work their way up amidst a rising chorus of concerns around lack of earnings growth momentum and rich valuations, our conviction levels continuously get tested. At such times, it is imperative to go back to the drawing board, consider the facts and get a lot more granular in our understanding of themes and opportunities for the coming years, in order to be able to guide our investors with confidence and conviction.

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