Baroda BNP Paribas Multi Asset Fund has posted a strongtop quartile performance over the last 1 yr as well as since its inception, some 20 months back.
70% net equity allocation – which is substantially higher than some popular MAFs – has been a key contributor to performance in this bull market.
Jitendra has the latitude to use arbitrage to bring down net equity sizeably below 65%, if he gets very concerned about markets – but he is not there yet. He does not expect any sharp correction as within a couple of months, markets will start looking at FY26 numbers, which gives a 12-15% cushion on valuations.
Easier interest rate environment globally and eventually in India, couple with healthy macros make him comfortable – more so in the large caps space.
The key risk he says is what could be the actual cause of rate cuts in US and EU. If soft landing expectations give way to recession clouds in the developed world, that could impact our bull market thesis substantially.
Another key performance contributor has been his exposure to gold – which has averaged 14 – 16% - significantly higher than many peers who maintain it at 10%.
Jitendra has been reducing his positions in large banks over the last 6 months – which has helped performance. He now sees the prospect of adding back some of those positions in the coming months, as we enter a rate cut cycle.
His portfolio is down to 1% in small caps on valuation concerns. He expects to build back some positions in the coming quarters when opportunities present themselves.