Stay the Course with Equities. Volatility isn’t the Time to Sell.
Summary findings:
- Vivekam stands tall among Fund Managers including those from most reputed business houses.
- Process driven fully automated solutions are set to trounce people backed policies.
- You don’t need to be a very big brand to deliver superior returns to clients.
- Investments chase returns and large networks seek unbiased and scalable solutions.
(Mis)Leading Advertisements:
Competition always demands participation from more than one player. In the world of equity markets, there are always several claimants of top honours choosing their own criteria to project them as leaders. Some such claims may appear like this:
- Performance of our MF topped the category for the period ended today!
- Performance of our model portfolio showed highest return in last one / two / three year period.
- AUM with our house is now the largest in the country in this category
- A few stocks advised by us have appreciated by 100% / 200% / 300% in last 1 / 2 / 3 years.
How to interpret the statements?
Let us help you why one should not be swayed by such statements. The first statement does not mean the performance will be repeated! It is claimed now because it could have happened by chance now. Second statement talks about model portfolio which might be entirely different from your portfolio. AUM size in third statement does not mean bigger the better. It merely boasts of large scale subscription from investors. Things need not be good just because more people braced it(Elected leaders are not always good in character!!). “A few stocks” in fourth sentence should lead you to realize a lot of other stocks failed to prove their mark. Why only a few stocks’ performance is touted?
Ideal comparison and positioning:
Our intent is not to deride any AMC, Fund Manager, Portfolio Manager or Registered Investment Adviser. Instead of selective leaks on some of their best results, it would probably be ideal if performance of their respective investments is compared with others over a little longer period. Still better would be not to limit the comparison to selected period or selected stocks or selected portfolios. If one undertakes to present the statistics of aggregate performance of all clients and compare the same with competition, investors will have better opportunity to explore what is best for them. Since markets are flooded with several Investment professionals(in the garb of AMC, PMS, RIA), the ideal comparison should be for longer periods and for varying periods of journey.
Vivekam’s USP:
Vivekam follows rule driven, AI backed, thoroughly back tested scientific processes to help clients handle their portfolios with timely advise. Backed by thousands of such clients, we compiled the statistics of all such clients together at aggregate level and evaluated our performance in the year 2018, post capitulation of most mid cap stocks and select large cap stocks. Unlike competition, at Vivekam, each client will run his / her portfolio independently and are least likely to have the same transactions between any two clients in a given period. Hence, unless our processes are far more superior, aggregate performance of all such retail clients is difficult to measure up and beat others.
BIO Growth from VIVEKAM and synonyms:
Vivekam has its product BIO Growth for the past several years successfully helping investors handle their portfolios with timely inputs. Two of the leading brokerages in India also have white labeled this product on their platform. While one such entity stipulated a minimum ticket size of Rs 25 lakhs, the other started its journey with Vivekam only from late 2017. We collected the data of Vivekam’s direct clients and compared with all MFs in the country having more than 5,000 Crore AUM. Our process used NAV given by these MFs to mimic the behavior of clients’ investment, if they were to go with such MF Schemes.
Let the facts speak!
Following table shows how Vivekam numbers stood when compared with top 10 such MF Schemes in the country. Since the names of MF schemes change often, we measured the best, 2nd best, 3rd best and so on at the end of each month. We followed the same methodology for calculating Nifty values too at the end of each month. Please note that all the returns shown are CAGR (Compounded Annual Growth Rates)
| Performance of the largest Market Cap MFs Vs Vivekam | |||||||
|
Apr-18 |
May-18 |
Jun-18 |
Jul-18 |
Aug-18 |
Sep-18 |
Oct-18 |
|
| Nifty returns |
14.31% |
13.36% |
12.28% |
16.21% |
17.44% |
11.43% |
7.19% |
| Vivekam |
24.05% |
20.14% |
14.32% |
20.70% |
22.29% |
9.29% |
11.46% |
| Best MF |
32.12% |
24.14% |
17.24% |
19.84% |
21.88% |
14.29% |
10.43% |
| 2nd Best |
22.47% |
17.74% |
16.69% |
18.07% |
21.62% |
12.21% |
9.57% |
| 3rd Best |
22.36% |
17.59% |
13.47% |
16.64% |
19.41% |
11.58% |
9.56% |
| 4th Best |
22.29% |
17.48% |
13.11% |
16.54% |
18.64% |
11.24% |
9.05% |
| 5th Best |
21.42% |
16.16% |
12.03% |
16.14% |
18.22% |
11.17% |
8.16% |
| 6th Best |
21.10% |
16.08% |
12.00% |
15.33% |
17.07% |
10.93% |
7.99% |
| 7th Best |
20.44% |
15.80% |
11.94% |
14.95% |
17.07% |
10.53% |
7.92% |
| 8th Best |
19.24% |
15.23% |
11.58% |
14.86% |
17.07% |
9.71% |
7.55% |
| 9th Best |
17.79% |
14.94% |
11.50% |
14.73% |
16.00% |
9.60% |
6.58% |
| 10th Best |
17.29% |
14.80% |
11.46% |
14.34% |
15.84% |
9.59% |
6.40% |
Green background and green number indicate Vivekam has beaten MF Schemes for that month. Red background and red numbers indicate Vivekam underperformed. Vivekam has been able to beat Nifty in most months(with the exception of September 18) and stood on top of several MF Schemes for most months(again September 18 being an exception). MFs that competed with Vivekam in a given month(s) may not be even in top 10 in following month! But Vivekam figured in top 10 in every month except September 18.
Conclusion:
The above table clearly establishes the superiority of Process Driven Strategy of investment over intuitive, impulsive and people backed policies being pursued by most entities. Apart from beating all MF Schemes in the country 3 out of 7 months, beating all but one MF Scheme in 2 out of 7 times and beating all but 2 best schemes in 1 out of 7 months is by no means a small achievement. We owe our success completely to our clients who not only reposed faith in our approach but also stood by us for the past few years, fully convinced with sound logic behind our approach.
Commitment:
While our clients continue to savour the success of our strategies, we vigorously work to refine our process further to address any possible weakness in this ever challenging times of investments.
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