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The 70:20:10 formula of Axis MF’s equity chief  


Jinesh Gopani, head of equities at Axis Mutual Fund, allocates his personal investment portfolio towards equity, real estate (in the form of physical properties), and gold in the proportion of 70:20:10 respectively.

When asked if he considers himself an investor with a high-risk appetite, Gopani smiled and said, “Given the age profile that I have now, I think it is better to make maximum gains at this age, and then slowly diversify asset mix towards a safer side later.”

Gopani shared his portfolio details for the special annual Mint series – Guru Portfolio, which started in 2020, to understand the impact of the pandemic on the personal investment portfolios of leaders in the financial services space.

The series looks at how respondents’ investments have fared, the changes made to their portfolios, in the last one year, and the investment lessons they have for investors.

Equity portfolio

Axis Mutual Fund and Gopani are long known for their ‘growth’ investing style of managing funds. 

Gopani said that 90% of his personal equity portfolio is invested in Axis Mutual Fund schemes managed by him or by his colleagues. 

Thus, automatically, his personal equity portfolio is also in line with the ‘growth’ investment strategy. 

“For us, growth is life. I believe, there’s no way one can earn wealth without focussing on growth. So, my investments also reflect that philosophy,” he added. 

On asking if he has also invested in the recently launched Axis Value Fund, he said, “As per the new Sebi requirement, skin in the game comes into play and some part of the holding has to go as per the designation. But, otherwise, the exposure is significantly towards growth style.”

The international exposure of 10-12% in his equity portfolio is also through investments in Axis MF schemes. This exposure is expected to go up, once the schemes’ allocation rises.

Calculated risk

Gopani has nil exposure to debt, except for the emergency corpus : equivalent to three months of expenses – parked in short-term fixed deposits. 

“All through my career, I have seen equity making wealth for the investors and I believe that it is a better bet than debt,” he added. 

When asked what can act as a buffer to his portfolio in times of market volatility, he said, “Since I invest in equity through mutual fund schemes, the risk is very calculated. If you look at the history in the last 10-15 years, I don’t think any good diversified mutual fund scheme would have seen more than 5-6% drawdown in a month, barring one-off events such as the financial crisis.”

Takeaway

Gopani said that he is a very systematic investor and never tries to time the market.

He advises the same to other retail investors as well. 

“When you invest for a 5 to 10-year period, don’t look at near-term ups and downs trying to time the market. Frankly speaking, even for a fund manager, it is very difficult to time the market. When we get money in our portfolio, we judiciously invest rather than trying to be smart.”

The other important aspect of Gopani’s personal portfolio showcases his conviction in the growth style of investing and sticking to it. Each investing style has its own periods of outperformance and underperformance. 

Many experts suggest that it is very important to consistently invest in one particular investment strategy than to shift from one style to another. 

(Note to readers: Through this series, we try to highlight the basic tenets of personal finance such as asset allocation, diversification, and rebalancing. We do not suggest replicating the asset allocation of Gopani, as personal finance is individual-specific and differs from one person to another.)



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