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Alpha Strategist March 2021 - Investment Strategy across Asset Classes Motilal Oswal Private Wealth Management

Mumbai 30-Mar-2021

Mumbai, March 30, 2021: As FY21 comes to a close, agreat deal of investment opportunities lay in front of us as we embark on ourjourney into FY22. As per Alpha Strategist report recently launched by Motilal Oswal Private Wealth Management, the recommendation for investors is to increase allocation in equities byinvesting 50% in lump sum and50% in a staggered manner over the next 3-6 months in Multicapstrategies and select Mid & Small Cap strategies(MFs, PMS, AIF). 

Asper their risk profile, investors having the appropriate level of Equityallocation should continue to remain invested and increase allocation if theyare lower than desired levels. New investors should accelerate deployment inthe event of any sharp correction

For the fixed income asset class, a barbell approach is recommendedwhere ‘Accrual’ should precede ‘Duration’ and the overall portfolio averagematurity should be  between 2-5 yearswith sufficient long term investment horizon according to the investor’s riskreturn profile. ~75% - 80% of the fixed income portfolio should be biasedtowards high quality short to medium term (2 – 5 years maturity) accrualstrategies with minimum investment horizon of 3 years. Within the aboveallocation; ~15% - 20% can be allocated towards long maturity and highquality roll down strategies with minimum investment horizon of 5 years.

To enhance the overall portfolio yield, investors with medium to highrisk profile can consider 20% – 25% allocation of the overall fixed incomeportfolio to select credit risk funds, MLDs, NCDS and high yield strategies.For liquidity management or temporary parking, investments can beallocated to Arbitrage/UST (minimum 6 months)/Liquid (less than 3 months)strategies which can be deployed in a staggered manner when opportunitiesarise.

Gold should be treated predominantly as a hedge against heightened volatility.Investors can participate through Sovereign Gold Bonds, Gold Funds &Digital Gold.

Mr. Ashish Shanker, Deputy Managing Director,Motilal Oswal Private Wealth Management said, “The3QFY21 corporate earnings results continued the strong momentum from 2QFY21with much better than expected PAT growth & earnings upgrades. For theNifty50 companies, as against an expected YoY PAT growth of 7%, the actualgrowth stood at 22%. This much awaited earnings recovery is likely to provide astrong tailwind for the domestic stock market which is well and truly marchingahead. The Govt''s focus on fiscal expansion and Capex spending augurs well forthe revival of the long anticipated private investment cycle. Nifty50 FY21 EPSis expected to grow by 15% YoY and 33% YoY for FY22E. The shift fromunorganized to organized sector has only enhanced over the last year. Marketleaders within their respective industries are likely to grow stronger and havebetter pricing power.”

About Motilal Oswal Wealth Management:


Motilal Oswal Private Wealth Management (MOPWM) isa part of Motilal Oswal Group – a brand that is trusted for knowledge basedinvesting with a proven performance track-record over 30 years. MOPWM wasincorporated in year 2007 to cater Corporates/Institutions, High Net Worth andUltra High Net worth Individuals. We use knowledge to identify the right mix ofFund Managers across asset classes to ensure that you have winning portfolio.“The more we know, the more you win” hence our wealth managers are empoweredwith the science and art of investing. In addition to these, you alsoexperience new insights and ideas on wealth creation through our exclusiveknowledge events. As of 28th Feb 2021, MOPWM manages the wealthneeds of ~5000 HNI families with AUM of ~Rs.18,000 Crore.



Website: http://www.motilaloswalpwm.com/

Twitter: @MotilalOswalPWM

For any further details, please contact:


Rohini Kute, Head – Group Corporate Communication,Motilal Oswal Financial Services

+9198201 96838, Rohini.kute@motilaloswal.com