Portfolio Management Services
Rested firmly on the two pillars of ‘Value Investing’ and ‘Result Orientation’, the Portfolio Management and Broking alternatives rendered by Moat are guided by an investment philosophy that is highly disciplined and process centric. Our credible and renowned channel partners administer a distinct style of investment management that aims to strike a perfect equilibrium between capital protections and return maximization. At Moat, due emphasis is laid on the method of compounding, in order to conserve and build wealth consistently across market cycles.
” PMS is a SEBI licensed investment platform for investing in stocks, fixed income, cash, structured products and other individual securities, managed by a professional money manager, which can potentially be tailored to meet specific investment objectives. Every account may be unique though portfolio managers may run several portfolios simultaneously. As per SEBI guidelines the minimum corpus required to invest is Rs. 25 lacs, either a sum of up to Rs 25 lakh or stocks worth this much or combination of both.
Unifi Capital PMS
Unifi is a specialized Portfolio Management company with over 15 years of Fund Management expertise and over 1200 Crores of Assets Under Management (AUM).
- Deep Value Discount Fund – The Fund seeks to achieve above-average returns with below-average risk. The market’s current focus is on short-term issues, rather than on a long-term structural shift. Today’s valuations allow for exceptional returns along with substantial downside protection. The Fund aims to double investors’ capital in 36 months or less.
- Spin Off Fund – The fund seeks to generate superior risk adjusted returns relative to market indices by investing in stocks of companies undergoing Spin-offs. Typically, such an action by the company will help remove the holding company discount that the market attributes and thereby enhance the stock’s valuation. Unifi’s proposition is to gain from the information asymmetry linked value-price mismatch, by closely tracking the entire Spin-Off process and investing in such companies after a detailed review of their fundamentals.
- APJ 20 – The Fund seeks to achieve absolute returns with below-average risk over a horizon of 4-5 years. The fund would invest in sectors that will benefit from the next stage of India’s growth on the back of improvement in India’s economic and policy climate. The Fund endeavours to grow investors’ capital by 3x in 5 years time or less.
- Hold Co Fund – The objective of the fund is to seek to unlock value by investing in listed holding companies across a wide array of industries. Holding companies in the fund’s universe are defined as those entities which hold stakes in other listed entities, and trade at a significant discount to the NAV of the underlying assets
- Insider Shadow Fund – Generate superior risk adjusted returns, in relation to the broad market, by investing in fundamentally sound companies where the promoters’ have acquired additional shares at market prices or companies that have repurchased their own shares. Typically, such an action by a company or a controlling shareholder demonstrates their conviction that the company’s growth prospects or inherent value has not been captured in its stock price at that point.
- Event Arbitrage Fund – The fund seeks to generate stable absolute returns that are consistently superior to conventional fixed income instruments by identification and quick execution of low risk – moderate gain event arbitrage opportunities arising in the equity markets from time to time. Additionally, nominal and high yield debt would be considered to ensure optimum utilisation of funds and enhance returns with uncompromising emphasis on capital preservation.
- India Sector Trend Fund – A historical analysis of market performance suggests that the broader indices at any given point in time are driven by a few sectors; each a function of its exclusive set of headwinds and tailwinds. Thus, an investment in the right sector at the right time is a definite means of earning superior returns over the benchmark indices. The underlying driver of this style is to align with sectors and companies that are in the favourable end of the business cycle and underweighting sectors facing industry head winds. The portfolio will largely (>85%) consist of companies within the blue chip universe of BSE200 while the fund management strategy is aligned with identifying and participating in growth as defined by (a) visibility of medium to long term earnings, (b) strong balance sheet metrics, (c) competitive MOAT and, (d) how the risk/reward is positioned at existing valuations. The fund manager at any given point in time reserves the flexibility to participate in an opportunity outside of BSE200 (not exceeding 15% of the portfolio) that is backed by in-house fundamental conviction.
Motilal Oswal PMS
We have discretionary Portfolio Management Service, which offers professional management of your investments with an aim to deliver consistent returns. It relieves you from all monitoring hassles with benefits like regular reviews, strong risk management flexibility and makes it an ideal investment avenue for high net worth investors.
- Value Strategy – The Value Strategy aims to benefit from the long term compounding effect on investments done in good businesses, run by great business managers for superior wealth creation.The Strategy has the investment style of buying Undervalued stock & Sell overvalued stocks, irrespective of index movements.
- Next Trillion Dollar Opportunity – The NTDOP Aims to deliver superior returns by investing in focused themes which are part of the next trillion dollar GDP growth opportunity The Strategy endeavor to capitalize on the themes of consumerism, Banking & Financial Services & Infrastructure in the Indian Economy.
- India Opportunities Portfolio Strategy The India Opportunities Portfolio will aim to capitalize on this growth by investing in companies which are expected to grow along with India and meet our unique investment philosophy of QGLP. The Strategy is a multicap strategy with exposure across market segments such as Large Cao, Midcap & Small cap to take the advantage of different market trends.
Sundaram India Secular Opportunities Portfolio ( SISOP ) – The objective of the portfolio is to generate capital appreciation by investing in concentrated set of high conviction stocks.
PACE – The product is suited for investors who seek long term capital growth by investments in equities of companies with good growth prospects
2Point2 Capital is an investment firm that focuses on taking concentrated bets for the long term in high quality publicly listed Indian companies at reasonable valuations. As investment managers, our primary goal is to protect capital followed by our goal to generate returns that exceed the equity index return over the long term.
2Point2 was co-founded by Amit Mantri and Savi Jain. They have a combined investing experience of 17 years, primarily in the private equity and hedge fund industry. The founders studied together at IIT Kharagpur more than a decade back. “2.2” is the length in kilometers of the arterial road that runs through the center of IIT Kharagpur.
2Point2 Capital Advisors LLP is a SEBI registered Portfolio Management Services (PMS) provider (vide registration number INP000005190).
Our investment strategy:
- Competitive Moat – Over the long term, only businesses with a strong competitive moat are able to create shareholder value. We seek to invest in businesses which have a strong competitive moat or are gradually widening their moat. The competitive moats that attract us are those driven by strong brands, distribution strength, inherent cost advantages, technology/IP and high switching costs. These businesses demonstrate high capital efficiency and are typically cash flow positive. We do not invest in businesses whose moats are primarily driven by regulations and political linkages.
- Margin of Safety – Our valuation of businesses is absolute and not relative. We seek to maintain valuation discipline by investing only at a discount to intrinsic value resulting in a margin of safety. This may entail staying in cash in periods of unreasonable euphoria in the markets and investing in periods of extreme distress. We steadfastly follow the principle of ‘Be fearful when others are greedy and greedy when others are fearful’.
- Corporate Governance – The Indian market is notorious for promoters indulging in activities which destroy value for shareholders (especially minority shareholders). We believe stable long-term returns are generated by partnering managements which treat minority shareholders as equal partners. We avoid businesses with weak corporate governance practices and only invest in businesses led by ethical management teams.
- Sectors – We prefer to invest in sectors that have long term growth opportunities. We avoid investing in highly regulated sectors, sectors linked significantly to commodity prices, ‘fad’ driven sectors and sectors exposed to technological disruption. We also avoid sectors that over a long period only generate accounting profits and not cash flows.
Marcellus Investment Managers
WEALTH CREATION WITH CONSISTENT COMPOUNDERS
Capital destruction of affluent Indians: The RBI has found that 95% of India’s household savings are invested in real estate, gold and durable goods. In fact, India is the only large economy in the world where financial savings are as little as 5% of household wealth. Since, real estate and gold have given only 9% per annum over the last 15 years (which, on a post-tax basis, is more or less equal to the inflation in the cost of living of an affluent Indian household), most households have not been able to augment their wealth in real terms.
Alpha-squeeze for equity mutual funds: Thankfully, in the recent past, Indian households have shown a growing fondness for equity mutual funds. Although large-cap equity mutual funds delivered meaningful outperformance (or alpha) between 1991 and 2006, their ability to deliver alpha has diminished radically over the past decade. Moreover, historical data suggests that there is less than 5% probability of a top-quartile ranked large cap equity mutual fund being able to stay in the top quartile for as long as 10 years. These two factors together make it extremely difficult for an investor to select a mutual fund which outperforms in a sustainable manner. So, given the need to compound wealth at a healthy rate what should Indian households do?
The Solution: Marcellus’ ‘CONSISTENT COMPOUNDERS’ Portfolio
Marcellus’ experienced investment management and research team led by its Chief Investment Officer, Saurabh Mukherjea, uses a combination of a filter based approach and indepth bottom- up research of companies to build a portfolio that delivers such outperformance through compounding over long periods of time.
The power of a filter based portfolio: We create a list of stocks using a twin-filter criteria of double digit YoY revenue growth and return on capital being in excess of cost of capital, each year for 10 years in a row. Next, we build a portfolio of such stocks each year and hold each of these annual iterations of portfolios for the subsequent 10 years (without any churn). The bar chart below shows the backtesting performance of such a filter based portfolio.
Source: Bloomberg. Note: Only the Consistent Compounder Portfolios which have finished their 10 year run have been shown. Note: These are total shareholder returns.
There are two conclusions from this exercise:
- This filter based portfolio delivers returns of 20-30% p.a. and 8-12% outperformance relative to the Sensex*.
- The volatility of returns of such portfolios, for holding periods longer than 3 years, is similar to that of a Government Bond
Why does the filter-based portfolio work? Three key reasons –
- Unique DNA of these companies: By “filtering in” companies with a history of very consistent fundamentals over very long time periods, the portfolio is skewed towards companies with a DNA built around relentlessly deepening their competitive moats despite disruptive changes taking place both inside as well as outside the organization. More often than not, such DNA sustains over the subsequent 5-10 years’ investment horizon of the filter based
- Power of compounding: Holding a portfolio of stocks untouched for 10 years allows the power of compounding to play out, such that the portfolio becomes dominated by the winning stocks while losing stocks keep declining to eventually become inconsequential.
- Avoiding the pitfalls of psychology and reducing transaction costs: Being patient with a portfolio helps cut out ‘noise’ of trying to time entry / exit With no churn, this filter based approach also reduces transaction costs. Consider two data points: (a) In a portfolio with 70% churn (average churn of large cap mutual funds), 20bps broking cost and 30bps impact cost, churn reduces the terminal value of the portfolio (after 10 years) by 10% (i.e. a drag of 120bps on the 10-year CAGR); and (b) deferring the 10% long term capital gains tax payable on the portfolio by 10 years enhances the terminal value of the portfolio by 8% (i.e. 100bps increase in the 10-year CAGR) vs a portfolio where capital gains are paid each year.
Bottom-up deep dive research by Marcellus’ fund managers: The Consistent Compounders Portfolio combines our deep-dive stock-specific research with the benefits of the filter-based approach explained above, to help generate outperformance of 2-5% per annum over and above these filter-based portfolios. This is achieved via three different types of interventions:
- Portfolio concentration: The filters might give a longer list of stocks (sometimes as high as 20) which dilutes the reliance of the portfolio on outstanding companies. We use manual intervention to produce a more concentrated
- Excusable blips in historical fundamentals are forgiven: For example, Nestlé’s Maggi episode ensured that revenue growth of Nestle India dropped below 10% in FY15. Similarly, the fall in crude oil prices to below US$30 per barrel caused a 6% product price cut by Asian Paints in FY17 which led to its revenue growth dropping below 10% YoY in FY17. Manual intervention in portfolio construction analyses the nature of these blips and might include such stocks in the
- Ignorable consistency in historical fundamentals: Many housing finance companies (HFCs) which form part of the filter-based portfolios, are examples of 10 years of consistent fundamentals delivered due to unsustainable macro tailwinds for the HFCs from low cost money market funding and a booming real estate market in the country – neither of which to our mind is
Marcellus offers Consistent Compounders Portfolio with zero fixed fees: The Consistent Compounders PMS comes with ZERO entry load/exit load and with no lock-in. Our clients can either choose a fixed fees model (2.5% p.a. fixed fees + zero performance fees) or a variable fees model (zero fixed fees + performance fees of 20% profit share above a hurdle of 10%, no catch- up).
*Returns here (both for our portfolio and for the Sensex) are on a Total Shareholder Return basis i.e. all dividends are included in the returns.
Dear Mr. Subhash,
My close friend Mr. Kishore was looking at investment options to secure his future. He was looking at various options when I had the opportunity to introduce him to you.
With so many options available in the market, mutual funds can be sometimes overwhelming to select the right one. This where an expert advice is required an I am glad I could introduce you to him. He was really happy that you understood his requirement in totality and then advised him the roadmap. You did not sell whatever you could but make him understand what he requires for future.
That was the primary difference and as a result, he could invest in the funds which suited his requirement to the “T” .
Thank you so much for the correct advice and establishing great credibility. Wish you luck always.
With Best Regards,
My relative Sheetal and her husband Deep has started their investment with Abhishek Gupta from last two years, they found that Moat Wealth Advisors are very good in investing their money in equity and got very good returns. So they are started giving referrals of their friends to Abhishek and now many of their friends, colleagues and relatives are investing
My relatives are so happy that they are thanking me a lot for referring Abhishek to them. I
take this opportunity to thank Abhishek and his Moat Wealth Advisors team. I highly recommend them as best investment advisors, prompt and professional services. Wishing Abhishek all the success in his business.
I, Thank Subhash Chawan for helping me select the right Mutual Fund product, to invest in. Your choice has helped me experience maximum gain in my Investment.
Our Investment’s made about two months ago, under your careful guidance, has resulted in a net yield (gain) of approx. 14% p.a. which is much higher then our usual Investment made in Fixed Deposits.
I would strongly recommend you and your company Moat Wealth Advisors, to one and everyone for carefree and rightful Investment in mutual funds.
Pray that you help many more with your rightful suggestions as offered to us.
Thanking you with the very Best if Wishes.
Mutual Funds are subject to market risk, Read offer document carefully before investing. But when it’s an investment in mutual fund with Subhash, the risk is what is informed to you…rather what he educates you.
In the collapsing market trend when most of the investment consultants are advising you go short, and when even Subhas is advising a similar position, what can make me invest in Mutual Fund is my trust in him. I am always a real estate person, but because of Subhas I am turning slowly into mutual fund segment.
As a Practicing Charted Accountant, with a client base having very low appetite for risk, but still aiming at wealth maximization, I advise them to go for mutual funds. And when I tell them to do so, I find most of them, already have burnt their hands in this segment. The reason for the disaster is not the wrong fund, but the wrong time and wrong decision. All thanks to the careless mutual fund advisors, who probably have intentions of wealth maximization…. not for their clients but for themselves.
So when you are planning to invest in mutual funds, don’t choose mutual fund but chose a good advisor and for me it is Subhash Chawan, the advisor who believes in the concept of Mutual Growth through Mutual Funds
Thankyou so much for all your help.
We have started SIP on recommendation of Moat Wealth Advisors and are extremely happy with their services. This is first Investment for our daughter for her long term education and other needs. Abhishek and his team gave us good guidance and showed benefits of Investing at young age. His paramount interest lies in customer first philosophy and accordingly he suggested Sukanya Samriddhi Account for my Daughter, Mediclaim etc. Where he was not earning anything which I really like about him.
We are happy with their services and would definitely recommend Moat Wealth Advisors as trusted team for mutual fund support partner to all.
My sister got divorced 10 years back. She had mixed emotions of helplessness/fear/insecurity especially financial. She had lost hope. Amidst this your company came to her rescue. She trusted her full alimony amount on you. Little did she know that how brave and smart this decision all turn out. Thanks to your constant follow-ups/guidance, her financial portfolio has upped considerably. Suddenly from being in a pitiable condition, you made her sit in evitable position. Thanks for giving her a sense of calm after an unexpected personal storm. My family will forever be indebted to you for this.
Our heartfelt Thanks.
When it came to understanding Mutual funds, my first discussion was with Subhash Chawan of Moat Wealth Advisors. He guided me with the systematic plan and how Mutual funds work and the wealth growth over the years. With the experience and the background of Moat Wealth Advisors I found a better way to grow my wealth. What was giving more comfort was that the way they have been able to switch and find the best funds to invest in, their regular daily updates, quarterly updates and the reports gives me confidence. I can very well say I have been having the best experience in Mutual fund investment with Moat,
Thank you Subhash for the excellent guidance. I am recommending Moat Wealth Advisors for all Mutual fund investors.
I trust MOAT WEALTH ADVISORS more than anybody and I have shifted all my funds to you for the investment in mutual fund. I am very happy with your prompt, professional services & confidence with which you execute your business. From now on wards I will invest only with Moat wealth advisors.
It has been some time that we have started referring you to our contact sphere for mutual fund investments. With so many options available in the market, Mutual Funds can be sometimes overwhelming to select the right one.
This is where an expert advice is required and am glad that I could introduce you to them. We have received positive feedback from whosoever have availed your expert advice. You did not sell whatever you could but make them understand what they require for future. That was the primary difference.
Thank you so much for the correct advice and establishing great credibility. Wish you luck always.
It gives me immense pleasure to write this testimonial for Mr. Subhash Chawan from Moat wealth Advisors. This testimonial is for a reference I had shared with Subhash over a year back for investments in Mutual Funds.
I had referred Mr. Rajeev Jadhav for investments in mutual funds to Moat wealth Advisors, as prior to meeting with Subhash he was investing with his personal banker. initially he was reluctant to meet a new investment advisor but after he met with Subhash and his team with his wife he was absolutely confident and not only he started a large amount of SIP with Subhash but also moved his other equity investments from his current banker to Moat Wealth Advisors in their equity Mutual funds and Portfolio Management Services – PMS. I must say that Rajeev and his wife are extremely happy with Subhash and his team for having regular reviews on the portfolio and guiding them well to receive maximum returns on the investment made by them with Moat Wealth advisors.
I would like to go on record and let you know that you are doing a wonderful job and I have shared this experience with most of my friends and you should expect more of my friends moving their investment portfolio to Moat Wealth Advisors.