Motilal Oswal AMC launches Motilal Oswal Hedged EquityMultifactor Strategy AIF

Firstof its kind strategy that combines multifactor, model-driven investing approachalong with tail-hedging

Mumbai, 08 March 2022: MotilalOswal Asset Management Company (MOAMC) today announced the launch of MotilalOswal Hedged Equity Multifactor Strategy AIF. Known for launching an array ofpassive funds, the new offering from Motilal AMC is an open-ended quantitativeequity fund in the Category III AIF segment.

The MotilalOswal Hedged Equity Multifactor AIF, is a first of its kind strategy thatcombines multifactor, model-driven investing approach along with tail-hedging. Thisscheme is designed in such a way that it has a low overlap with Nifty50companies and correlation of about 65-70% leading to a differentiated portfolioexposure.

The Equityportfolio is 100% systematic with no human intervention in stock selection andweighting. The equity strategy uses investment factors such as Quality, LowVolatility, Value, and Momentum to form a concentrated portfolio of 20-25equity stocks.

Tail-Hedging isdesigned to protect the investor from black swan events which are unpredictablebut at the same time have been the most significant contributors of portfoliolosses. The fund seeks to provide this protection by creating a low-cost ‘longvolatility’ position that benefits when market volatility invariably shoots upduring such periods.

During the spanof 10 years starting from 2011, the back-tested returns of the strategy was ableto consistently generate higher returns at lower volatility as compared to theNIFTY 500 TRI, which is the scheme’s benchmark.

Mr. Pratik Oswal, Head of Passive Funds, Motilal OswalAsset Management Company Ltd said, “Motilal OswalAMC have always been pioneers in bringing innovative investing solutions toinvestors. The Motilal Oswal Hedged Equity Multifactor Strategy is a uniqueoffering that combines the benefits of rules-based investing and tail-hedgingwith the objective of delivering superior portfolio outcomes across variousmarket conditions.”

Commenting onthe launch, Mr. SankaranarayananKrishnan, Fund Manager, PMS & AIF schemes, Motilal Oswal Asset ManagementCompany Ltd said, “The fund has a differentiated portfolio, with a lowoverlap with the NIFTY 50 index and lower BFSI exposure, leading to a muchlower correlation with the NIFTY 50 index. The portfolio is based on a modelthat combines factors such as Quality and Low Volatility, which havehistorically delivered alpha in falling markets, along with factors like Valueand Momentum, which have traditionally done well in rising markets. Theaddition of Tail Hedging not only protects the portfolio from severe losses butalso provides capital to invest in market lows.”

Source:Data from 30-Sep-2011 to 31-Dec-2021. Motilal Oswal AMC Internal Research,niftyindices.com

Disclaimer Disclaimers & Risk Factors

The content is issued on the basis of internal data,publicly available information and other sources believed to be reliable. Theinformation contained in this document is for general purposes only and not acomplete disclosure of every material fact and terms and conditions. Theinformation / data herein alone is not sufficient and shouldn’t be used for thedevelopment or implementation of an investment strategy. It should not beconstrued as investment advice to any party.

All opinions, figures, charts/graphs, estimates anddata included in this presentation are as on date and are subject to changewithout notice. The statements contained herein may include statements offuture expectations and other forward-looking statements that are based on ourcurrent views and assumptions and involve known and unknown risks anduncertainties that could cause actual results, performance or events to differmaterially from those expressed or implied in such statements. Readers shall befully responsible / liable for any decision taken on the basis of thispresentation. Investments in Securities are subject to market and other risksand there is no assurance or guarantee that the objectives of any of theSchemes will be achieved. The scheme may not be suited to all categories ofinvestors.

The material is based upon information that weconsider reliable, but we do not represent that it is accurate or complete, andit should not be relied upon as such. Opinions, if any, expressed are ouropinions as of the date of appearing on this material only. While we endeavorto update on a reasonable basis the information discussed in this material,there may be regulatory, compliance, or other reasons that prevent us fromdoing so. Recipient shall understand that the aforementioned statements cannotdisclose all the risks and characteristics. The recipient is requested to takeinto consideration all the risk factors including their financial condition,suitability to risk return, etc. and take professional advice before investing.

As with any investment in securities, the Value ofthe portfolio under management may go up or down depending on the variousfactors and forces affecting the capital market.  

This document is not for public distribution and hasbeen furnished solely for information and must not be reproduced orredistributed to any other person. Persons into whose possession this documentmay come are required to observe these restrictions.

Investment in Securities is subject to market andother risks and there is no assurance or guarantee that the objectives of anyof the Schemes of Alternative Investment Funds will be achieved. Please readPrivate Placement Memorandum of the Scheme carefully before investing.

In case of any further information, please write backto us at aifservice@motilaloswal.com

About Motilal Oswal Asset ManagementCompany:

Motilal Oswal Group possesses legacyin equities for over 3 decades. Motilal Oswal Asset Management Company Ltd.(MOAMC) is registered with SEBI as the Investment Manager for Motilal Oswal MutualFund. It was incorporated on November 14, 2008. It provides InvestmentManagement and Advisory Services to investors based within and outside Indiaand having AIFs, Portfolio Management Servicesbusiness, ETFs and Mutual Funds. 

MOAMC is one of the most honoured andtrusted names in equity investing. MOAMC is one of the pioneers of PMS businesswith over 17 years of track record. It is also one of the pioneers of passivefunds in India through ETFs way back in 2010, Motilal Oswal Nifty 50 ETF, MotilalOswal Midcap 100 ETF, Motilal Oswal Nasdaq 100 ETF – the only offshore ETF andhave exclusive rights for Nasdaq.