'Low-friction investing fuels short-term reactions'

Model-driven vs human-led portfolios?

All our offerings across mutual funds and PMS are 100 per cent rule-based. Every decision—from stock selection to allocation—follows a disciplined, data-backed model that removes human bias. In the US, equity smart beta funds have grown to over $2.5 trillion since 2000. In India, passive equity strategic schemes have jumped from Rs 247 crore in August 2019 to over Rs 46,000 crore in August 2025, while active equity smart beta funds have expanded from Rs 175 crore to Rs 25,000 crore in the same period.

Technology and structured data have made quant strategies more precise and efficient, raising the probability of consistent long-term alpha. Still, the human edge remains vital—not for stock-picking, but in defining rules, interpreting market shifts and designing smarter models. In essence, human judgment now shapes frameworks that drive intelligent, bias-free investing.

Your first fund and trust playbook?

Our first mutual fund, NJ Balanced Advantage Fund, blends rule-based quality investing with dynamic asset allocation—helping investors protect downside and capture upside across cycles. What sets us apart is our 100 per cent process-driven approach, customer centricity and portfolios that differ meaningfully from benchmarks. Low overlap ensures genuine diversification.

Our investor trust framework rests on transparency, process-driven redressal and robust communication to empower investors.

On low-friction investing and investor churn.

Digital access has revolutionised investing. Since Covid, demat accounts have surged fivefold to over 20 crore. Yet, with instant execution and tracking, many investors tend to react to short-term market movements instead of staying focused on long-term wealth creation. Nearly half of digital investors’ AUM churns within two years, with 30 per cent exiting in under a year. This trend of rapid churn is an unintended consequence of a low-friction ecosystem.

At NJ AMC, we see this as an opportunity. Through product design, we aim to help investors stay disciplined. NJ Balanced Advantage Fund is one such solution. In short, while technology has changed how people invest, our role is to ensure that we offer sustainable solutions.

Rapid-fire questions

• One AMC you admire (not yours): Dimensional Fund Advisors.
• One hot trend you’re glad to have skipped for your investors: Sectoral or thematic products.
• Beyond returns, one criterion you want investors to judge your AMC on: Commitment, integrity and capability.
• If not running an AMC, what would you be doing? Educate investors.

This article was originally published on October 25, 2025.