Every business needs a plan or a strategy. IDFC has its strategy in the way it focuses its business across all relevant target segments. “There are three segments of investors; institutional, retail and HNIs. We have product offerings to suit them all,” says Naval Bir Kumar, MD, IDFC Mutual Fund.
Regulatory changes: If you look at the industry growth in the past, the bulk of asset growth was due to sale of equity NFOs. Very often these NFOs were aggressively sold because of much higher brokerage structures due to the amortization rule that existed in those days. The only beneficiaries were distributors, who gained from high brokerages. Hence the regulatory changes realign the interest of all the three players. If the industry has to see a healthy growth, the interest of all three players - fund managers, distributors and investors - has to align.
The road ahead: For the retail market, we need to create products, with less volatile returns that can substitute fixed deposits. We have been focusing on capital protection funds, asset allocation funds and other hybrid funds such as monthly income funds (MIPs).
My investing style: I stick to an asset allocation plan rather than take market calls. I run my portfolio passively. I don't get too distracted with the way the market moves once I have made my investment.
This article was originally published on October 27, 2010.
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