As winners keep changing, no one can predict which asset class will outperform at any point in time, said S Naren, ED & CIO, ICICI Prudential AMC.
“As it can be seen from the performance of various asset classes over the past decade and more, every other year, the winning asset class keeps on changing. The only way to make the most in such a situation is by spreading one’s allocation across asset classes, such that on an aggregate basis, the portfolio can tap into the potential benefits and gains that each asset class renders,” said S Naren.
“Across market cycles, such an approach has aided in delivering a better risk-adjusted investment experience. Furthermore, multi-asset investing can aid in curbing portfolio volatility and over longer time horizons, the importance of de-risking the portfolio cannot be overstated,” he added.
ICICI Prudential Multi-Asset Fund recently completed 20 years. As of October 31, 2022, the scheme has an AUM of Rs 14,227.24 crore, which accounts for nearly 68% of the total AUM in the multi-asset category.
It is an open-ended scheme investing in equity, debt and exchange-traded commodity derivatives/units of gold ETFs/units of REITs & InvITs /preference shares. The scheme invests across market capitalizations and various asset classes, intending to generate absolute returns over longer time frames.
The AMC, in its report, stated that a lump sum investment of Rs 10 lakhs at the time of inception (October 31, 2002), as of October 31, 2022, made approximately worth Rs 4.6 crore, i.e. a CAGR of 21.2%. A similar investment in
Nifty 50 yielded a CAGR of 17.4%, approximately Rs 2.5 crore, it added.
In terms of SIP performance, a monthly investment of Rs 10,000 via SIP since the inception, which would amount to a total investment of Rs 24.1 lakh, has grown to Rs 1.8 crore as of October 31, 2022, i.e. a CAGR of 17.4%, it said.
ICICI Prudential Multi-Asset Fund invests a minimum of 10% of its assets in three or more asset classes. The net equity can range between 10-80%. The scheme follows a counter-cyclical approach in investing and may take sector deviations against the benchmark. It may also take exposure to REITs, InvITs and covered call options to enhance portfolio yield.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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