Prabhudas Lilladher’s portfolio management services division has launched Multi-Asset Dynamic Portfolio, a quantity-based tactical asset allocation strategy to eliminate the human biases that accompany active management.
The portfolio will invest in seven asset classes including domestic large and mid cap stocks, international stocks, gold, government bonds, corporate bonds and cash funds.
It will invest only through passive instruments in order to eliminate security selection, sector selection and style selection risks. This combination of dynamic index-based and low-cost asset allocation coupled with the Quant methodology makes the portfolio a unique and first-of-its-kind offering in India.
Dynamic asset allocation
A dynamic asset allocation model ensures that investment is made in the right asset class at the right time across different market cycles.
Amisha Vora, owner and co-CEO, Prabhudas Lilladher, said the quantitative model and proprietary meters anticipate market cycles in advance and rebalance the portfolio when an asset class is about to reach a point. significant inflection.
Global research shows that 91% of returns are achieved through the right asset allocation, not by timing the market or stock selection. Prabhudas Lilladher, through the MADP, thus puts the focus back on smart asset allocation, he said.
To determine the optimal weighting for each asset class in the portfolio, the portfolio relies on nine proprietary meters that track over 100 of these factors. The meters were developed by Quantifi, the quantitative research and investment management arm of PL, said Siddharth Vora, Head – Quant Investment Strategies and Fund Manager – PMS, Prabhudas Lilladher.
June 08, 2022