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Sameer Narayan, Head – Alternate Investment Equity, ABSL AMC shared with us his strategy to generate alpha with low risk investments at the recently held CafeAlt Conference 2024.
According to Sameer, the best factor working for Indian markets currently are its population and productivity, which will stay for at least a decade or half a decade till the majority of population is in the age group of working professionals.
He asks investors not to rely too much on the past performance because until recently, markets have never seen such sustained growth.
Sameer says that the growth of alternate industry at 20-22% CAGR is due to the rise in number of millionaires in dollar terms i.e. people with investable assets over $1 million (about Rs. 8.50 crore). This number is expected to double in the next 5 years which will give great opportunities for investment in alternatives.
Sameer asks investors to focus on doing the basics right. He recommends them not to chase high beta stocks. Also, his advice to investors is to look at a portfolio with a low churning ratio of less than 0.5.
For Sameer, the mantra to create wealth is not taking too much risk but delivering returns.
Sameer asks investors to have trust in the market, pick good businesses and stay invested for the long term. He also says that the Indian market gives a lot of great options for fund managers to choose from.
According to Sameer, the new generation of investors don’t need to be nudged to invest in equity. The biggest role of assets managers is to handhold investors and save them from the fault lines in the market. He sums up his strategy saying, “Buy good businesses with a long opportunity canvas and nonlinear growth outcomes and stay invested.”
You may watch his session by clicking here.