According to reports from The Hindu BusinessLine, Avinash Satwalekar, President of Franklin Templeton India, has expressed concerns about the impact of market volatility on Systematic Investment Plans. The sharp fall in key indices and bearish sentiment amid the raging war in West Asia are expected to have a major impact on SIP inflows. Satwalekar noted that what most investors tend to do is cancel SIPs, which he described as technically averaging down and missing opportunities to buy more units for the same rupee.
As reported by The Hindu BusinessLine, Satwalekar emphasized that if one looks at equity market history, bear markets are measured in months while bull markets are measured in years. He urged investors to stop worrying about negative returns in the last two years and market volatility. The Franklin Templeton fund house has reduced its cash position substantially and remains fully invested in equity even as markets experienced a topsy-turvy ride.
According to the report, Satwalekar stated that markets give an opportunity every five years to truly put money to work. He emphasized that if you do not take that opportunity, you will get rich, but you will not get wealthy. The fund house believes in its portfolio construct and using the recent fall in valuations to top it up. Satwalekar made these comments on the sidelines of an event to launch the fund house's equity long-short SIF under Saphire SIF.
As reported by The Hindu BusinessLine, Franklin Templeton launched a new long-short equity SIF designed for navigating rapidly moving markets. The fund can potentially take advantage of market shifts by taking short positions up to 25 per cent of their net assets, which can help reduce downside risk during market corrections. Arihant Jain, Portfolio Manager of Sapphire Equity Long-Short SIF, explained that the underlying quantitative model uses leading and lagging indicators to assess stocks while preserving strong risk management.
