Shweta Rajani says: “Today you have arbitrage options which are like debt for you to a certain extent and are taxed at 10%. So that can be managed very well but just getting your asset mix right and your market cap mix right which is relevant for your portfolio and your strategy cannot be done in a multi-asset or a hybrid fund. This is where I would suggest a pure play equity and debt rather than a multi-asset.”
“Human expertise comes in at various points like setting up your goals. A lot of times, you have to nudge an investor to help him understand what his goal should be. Only when he understands what his goal would be, can you feed it in your robo system, risk tolerance.”
“We have seen some of these active fund managers gradually increasing their exposure to technology. And in India, most fund managers have allocations to a few of the companies that have been developing a lot of AI – Infosys, HCL Tech, Wipro. In the last two years, the allocations have gone up. There are various other sectors also which are benefiting from it.”
“If you have money which is needed after 10 years plus, then having a slightly higher equity, even to the extent of 80% equity would be good to have in the portfolio. So, look at your asset allocations; five to six years, 65 to 75% equity, if more than that, then you can have 80% equity.”
Short-term debt funds are categorized based on the investment horizon. For investments of a few days or weeks, liquid and overnight funds are appropriate. For a horizon of six months to a year, money market, ultra short duration, and low duration funds are suitable. Short duration funds are recommended for a horizon of two to three-and-a-half years. The yield or return expectation for these funds ranges from 6.8% to 7.2%. There is an inverse relationship between interest rates and returns.