The strategy’s long-term dynamic asset allocation approach aims to maximize Alpha vis-à-vis the benchmark and yet control the Beta to optimize risk adjusted returns, providing alpha during market upside and protection during market downside by investing in a basket of selective quality ETFs that provide exposure to wealth magnifiers and preservers.
The fund is meant for cautious investors who want to participate in the Indian equity bull run but insist on limiting downsides if the markets turn unfavorable and will emphasize on sectors that are outpacing earnings growth and have high profitability, low leverage and consistent cash flows as compared to peers.
“With Tresor Smart Alpha, we’re offering investors a unique opportunity to participate in India’s economic growth story while controlling risk and minimizing drawdowns by fully capitalizing on our macro top-down expertise,” said Amit Goel, Co-founder and Chief Global Strategist at Pace 360 as he emphasized the value of investing in ETFs.
Also read: Gold, silver mutual funds offer up to 9% return in 2024. Here’s how to allocate your money
“The Tresor Smart Alpha strategy, which focuses on Equity ETFs, presents significant advantages over strategies with concentrated stock exposure. For instance, during the 2020 Yes Bank meltdown, the NIFTY Bank Index showed stability, highlighting the benefits of sector-wide exposure. Similarly, we saw that indices and sub-indices eventually recovered and reached all-time highs after the 2008 financial crisis and the COVID-19 pandemic, while many individual stocks went into oblivion as regime changes inevitably followed each economic crisis,” Goel added.
He further explained how ETFs provide greater diversification, helping to reduce risk and volatility, allowing investors to benefit from overall market growth while mitigating company-specific risks, which makes it a more stable investment choice, particularly in uncertain times.
The fund rotates between opportunities based on macro economic indicators, market cycles and analysis of both the fundamentals and technicals of a theme or sector aiming for a beta below one when markets are overvalued and higher than one when they are undervalued. This strategy seeks to offer an enhanced risk-adjusted alpha by controlling the beta at levels appropriate to different phases of the equity markets. By investing in a diverse range of ETFs across geographies and sectors like Auto, FMCG, Pharma, IT, financial services and themes such as Electric Vehicles, Defence and Infrastructure, Tresor Smart Alpha provides a well-diversified portfolio for long-term growth.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
