Avoiding pitfalls as important as generating alpha: Kotak AMC's Head of Equity Research

It is because Shibani Kurian has nearly 25 years of experience that she can manage two funds with polar opposite investment strategies. As the Head of Equity Research and a Fund Manager at Kotak Mahindra AMC, she oversees five equity funds, with total assets exceeding Rs 9,600 crore. Among them, the Kotak India EQ Contra Fund and Kotak Focused Equity Fund stand out - two funds that, while both carrying a four-star rating from Value Research, follow very different approaches to investing. During our conversation, Kurian shares how she navigates managing these two contrasting funds and provides a glimpse into Kotak AMC's investment strategy. Below is an edited transcript of the interview, where Kurian also offers insights into her investment approach and her journey in the industry. Looking back, what key lessons or pivotal moments have defined your career? When I look back on my career, there have been times when markets have been volatile. A few of these events, like Y2K issue, occurred when I first entered the markets in 2000. The global financial crisis then struck in 2007-08, just when I joined Kotak Mahindra AMC. Subsequently, we experienced the Taper Tantrum and the Covid crises, among others. I believe the most valuable lesson I've learned from these periods of volatility is that, while as a fund manager or research analyst, we constantly strive to identify stocks that have the potential to generate significant returns, at the same time, we must not lose sight of downside risk. Avoiding pitfalls is as important as evaluating ideas that can help you create alpha. Remember, creating alpha is not only about upsides; it's also about managing your downside risk. Therefore, risk management and taking a risk-adjusted approach to a portfolio is my biggest takeaway from having lived through these periods of volatility. The long-term trend in the equity markets is upward, but how you navigate these periods of sharp volatility ultimately shapes your portfolio performanc