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Monday, August 01, 2016

Diversity within a single fund house - ICICI Prudential Mutual Fund..!

Diversity within a single fund house - ICICI Prudential Mutual Fund..!

ICICI Prudential Mutual Fund's efforts to distinguish themselves across stakeholders has paid rich dividends

Driven by an entirely investor centric approach, the organization today is a suitable mix of investment expertise, resource bandwidth and process orientation. The AMC endeavours to simplify its investor's journey to meet their financial goals, and give a good investor experience through innovation, consistency and sustained risk adjusted performance.

Beat benchmarks-100%..!

As a fund house, their philosophy is to beat benchmarks-100% of their equity Assets under Management (AUM) have beaten the benchmark across investment horizons of 2 Year, 3 Year, 5 Year & 15 Year. But investors are looking for absolute returns.

There is a huge gap between what the investors want and what can be offered. Therefore, the belief is that investors need an informed distributor to align the investor's goal with product's investment mandate.

The company has constantly been on the forefront of innovation and has introduced products aligned to meet customer needs. For instance, recently , the company has launched a Medical Advantage Feature in ICICI Prudential Savings Fund.

It's a feature through which investors can seamlessly use their investments in the Fund to pay for hospitalization bills anywhere in India.

Win-win solution for investors..!

It is a win-win solution for investors, as they not only get capital appreciation when the money is parked in mutual funds but can also avail cashless access to empanelled hospitals for medical expenses.

As technology is becoming omnipresent, the status quos that still exist in sales processes of the mutual fund industry , could be done away with to boost the productivity of advisors with IPRU TOUCH. Engaging with advisors through IPRU Touch, a mobile application created exclusively for financial advisors to transact on behalf of investors.

Integration of key processes, minimization of paper work, optimal content experience and streamlining of the sales activities are some of the many goals they aim to achieve for their distributor community through IPRU Touch.


Diversity within the fund house

They have built diversity within the fund house by offering variety of investment strategies Value Contrarian, Growth at Reasonable Price (GARP) and Growth, consciously aligning investing styles of different fund managers with the respective fund objectives.

In fact, they have a culture where fund managers are encouraged to develop their individual styles but at all times these have to be practised within the overall investment framework.

The fund managers have been asked to follow the fund's objective to the hilt and hence no style drift is allowed beyond the boundaries of the fund's mandate.

Focus on long term performance

There is always an endeavour to not go wrong on management when selecting companies. This has helped them to stand behind their conviction calls without worrying about short term performance, and focus on long term performance.

The fund house also focuses simultaneously on the 'top down' and 'bottom up' strategies.

More than 83% of the distribution

The fund house is recognised as a trust worthy fund management company across distributors and customers. More than 83% of the distribution across the country sell the schemes of ICICI Prudential AMC.

In the previous year, they crossed a milestone achievement of becoming the largest asset management company in the country with total assets under management of ?

Rs. 179403.46 Cr as on March 31, 2016.

Indeed, this achievement is a reaffirmation of their efforts to distinguish ourselves in the marketplace across stakeholders. They believe that a fund house managing money well is bound to attract more investments.

Risk-adjusted returns to investors.

Managing other people's money is a huge responsibility; and, it is their resolve to give good risk-adjusted returns to investors.

Way back in 2004, 'ICICI Prudential Value Discovery Fund (erstwhile ICICI Prudential Discovery Fund)' was launched to let investors benefit out of value investing.

Now value has become an accepted model of investing.When this fund was launched ten years back, there was a belief that in India, value investing won't work.However, now people are willing to believe in value as a way of investing and they believed in it at a time when nobody did.

Dynamic asset allocation funds

Over the past two years due to persistent volatility, they are advising distributors and investors to look at dynamic asset allocation funds, as such funds will prudently allocate dynamically in equity when the stock market is rising, and increase allocation to debt instruments and bonds, thus conserving gains.

Traditionally they have learnt that to make returns in the market, one should buy when markets are falling and sell when markets are rising.

But a general tendency of Indian retail investors is to invest in equity when the markets are surging high, while pull out money when the markets are under performing which may not necessarily lead to the best investment experience.

It is important for an investor to understand investment risk profile based on which one could decide the asset allocation (i.e. how much of one's wealth should be invested in which asset class).

While in the MF industry , it is often seen that products have no clear positioning or distinction, ICICI Prudential AMC has ensured sharply focused products with every fund giving a different slice of market to the investor.


Diversity within a single fund house - ICICI Prudential Mutual Fund..! Reviewed by S. Chitra on August 01, 2016 Rating: 5 Diversity within a single fund house - ICICI Prudential Mutual Fund..!  ICICI Prudential Mutual Fund's efforts to distinguish the...

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