Homegrown AlphaGrep takes on Jio BlackRock with India Algo Funds

High-speed trader AlphaGrep Securities Pvt.’s asset management unit will offer algorithmic-driven trading strategies to India’s retail investors, according to a top executive, pitting it against the likes of Jio BlackRock Asset Management Pvt. for a slice of the nearly $900 billion mutual fund industry.

Over the next 18 months, AlphaGrep Investment Management Pvt plans to unveil about half a dozen mutual funds, Chief Executive Officer Bhautik Ambani told a press conference Tuesday. On July 6, it will launch the first fund, a dynamically managed multi-asset fund investing across equities, fixed income and commodities.

“The space we are looking to enter is active quant, where we harness technology, data and quantitative models while still targeting alpha,” Ambani said. “We believe this is a blank space in India today, and it will get filled over the next few years as investors increasingly look for strategies that combine human judgment with technology.”

Firms like Jio BlackRock and Quant Mutual Fund are offering a range of institutional-grade systematic investment strategies to lure a surge of retail investors who have entered the Indian equity markets after the pandemic. AlphaGrep’s proprietary infrastructure has been operational in India for more than 15 years, while Jio BlackRock is powered by the US giant’s Aladdin portfolio management machine.

Founded in 2010 by Mohit Mutreja and Prashant Mittal, AlphaGrep Securities was among the early firms to adopt algo trading after India’s market regulator permitted it. The firm’s proprietary trading book has grown to more than 30 billion rupees ($317 million), Ambani said.

Its asset management business now oversees more than $1.5 billion across India, China and the UK, including about $200 million in India through alternative investment funds, portfolio management services and GIFT City funds.
AlphaGrep will use AI tools to help onboard distributors, having already launched one tool that has been used by more than 400 partners.“We are trying to build an AI tool which will help mutual fund distributors to do research around strategies, goal planning, a lot of different variables which can potentially help elevate their business,” Ambani said.

AlphaGrep Investment Management plans to launch flexi-cap, arbitrage, hybrid, balanced-advantage, and mid-cap equity funds over the next 12-18 months, and a specialized investment fund soon, according to Ambani. Over three to five years, it hopes to garner assets of up to 300 billion rupees, he added.