Warren Buffett advises us to "be fearful when others are greedy and greedy when others are fearful". Most investors are unable to actually do this.
For distributors, "money in the sidelines" represents a huge lost business opportunity because very often it remains in the sidelines, as investors fear when they should be greedy and then regret missing the bus when a big rally comes through unexpectedly
The L&T Dynamic Equity Fund is a great solution in this context, as it automatically does exactly what Warren Buffett advises, on the basis of a simple and completely transparent template.
"Be fearful when others are greedy and greedy when others are fearful" - that's one of Warren Buffett's immortal quotes. Easier said than done. That's what perhaps makes him special - the fact that he's able to actually do this, when most of us don't.
I know from experience how difficult it is for advisors to get their clients to embrace this philosophy. Even people like us who belong to the industry, often succumb to bouts of greed and fear.
A wave of fear has enveloped global markets - the fear of tremendous uncertainty and along with it the worry of another '2008 crisis.' While one set of experts believe worse is ahead, another set believe this time to be ideal to buy. When markets fall, you would tend to believe the former set and when markets rally, you would tend to go with the latter.
But what do investors typically do in such situations?
For those who are already invested in the markets, volatility breeds panic; and for those who are contemplating, it breeds inaction. Both, as we know, are not the best responses to the situation. Despite this, we fail to get investors out of the clasp of greed and fear.
Here is where, "money on the sidelines waiting to be invested" often remains idle i.e. - on the sidelines. And that will affect not only the investor but also you as a distributor. It is in this context that I present this product from L&T Mutual Fund, which could let you help your clients break through this cycle of fear and greed and to adopt a disciplined investing approach.
The L&T Dynamic Equity Fund* is a fund that allocates between equity, equity related instruments, derivatives and debt and money market instruments on the basis of market valuations. The allocation is driven by a simple, transparent P/E based model as mentioned below.
P/E based asset allocation model
To learn about the objective, strategy and suitability of the fund, please watch this video.
When your investors invest in L&T Dynamic Equity Fund, they will in effect be following Warren Buffett's advice - greedily buying equity when others are fearfully selling and fearfully selling when others are greedily buying.
What could work best for your investors is to invest in this auto-timing product. The rest could automatically be taken care of by us on the basis of a fully transparent, logical and easy to understand template.
We live in an age where customers want solutions that are simple to understand and effective in performance.
Consider this. We all want to click great pictures, right? But how many of us buy a camera that makes you work even harder at the picture by manual focusing, light adjustments and all that. We all swear by the auto-focus ones, which provide quality and easy usage - the complete package!
This is what your clients expect with their investment too - an automated style of investing.
So give your clients the option to put their 'idle money' to good use and at the same time, take their mind off market worries. The L&T Dynamic Equity Fund could give them good investment outcomes by bringing in an auto-discipline element to their portfolios.
'This article is for general information only and does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this information. Recipient of this article should understand that statements made herein regarding future prospects may not be realized. Neither this article nor the units of L&T Mutual Fund have been registered in any jurisdiction other than in India. The distribution of this article in certain jurisdictions may be restricted or totally prohibited and accordingly, persons who come into possession of this article are required to inform themselves about, and to observe, any such restrictions. For further information relating to L&T Dynamic Equity Fund please refer to the Combined Scheme Information document dated January 30, 2016.
This article is only for distributor's purpose.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.'
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