“The right time to invest in Small Caps is when the pessimism is the highest and the absolute valuation is very cheap for the Small Cap segment of the market. Every 5-7 years’ equity markets give an opportunity to invest in Small Caps at a very attractive valuation. In the Year 2003, 2008 and 2013 Small Caps were very attractively valued and we believe the year 2020 is again providing a fantastic opportunity to invest in Small Caps at very cheap valuations. The differential valuations between Large Caps & Small Caps is at a decade high and this offers a significant opportunity to investors to invest in Small Caps and make significant alpha over large cap stocks” said Mr George Heber Joseph, CEO & CIO, ITI Mutual Fund.
ITI Mutual Fund aims to offer the right product to the investors at the right time and brings a new paradigm in Asset Management space by focusing on a unique investment philosophy - SQL (S - Margin of Safety, Q - Quality of the business and L - Low Leverage). In the first six months of existence itself the fund house has created a very strong risk management framework and solid investment processes with a clear focus on bottom up research methodology to pick the right set of stocks in the portfolios.
ITI Small Cap Fund will have a well-diversified portfolio. Individual stock exposure will be capped at 3% (per cent) of the AUM at the time of investment. The Fund is benchmark & sector agnostic and at the time of purchase the fund will stick to Small Cap universe only as defined by AMFI. At least 80% of the portfolio will be core stocks and tactical bets will not be more than 20%. The objective of the fund house is to generate consistent & superior investing experience for all our investors.
The minimum initial investment in the scheme is Rs5000/- and in multiples of Re. 1/- thereafter. The additional investment amount is Rs1000/- and in multiples of Re. 1/- thereafter. The scheme will have minimum 65 % allocation in equity and equity related instruments of Small Cap Companies and a maximum of 35% in other than Small Cap companies, debt and money market instruments. The fund will be jointly managed by Mr. George Heber Joseph and Pradeep Gokhale.
Structural measures taken by the government might have impacted the economy in the near term, but are quite positive from a long term perspective. Formalisation of the economy is happening at a rapid pace and we see many opportunities to invest in this regard. In such a scenario we are bullish on the economy and investing in equities provides a fantastic wealth creation opportunity in the next decade. As the whole economy is going to revive and broad market earnings growth to pick up, we strongly believe investing in Small Caps at this juncture can be really rewarding and mostly the fabulous results could be seen in next 3-5 years.
George strongly believes “The small cap segment offers significant wealth creation opportunity as many positive economic measures taken by the government always tend to start yielding results after a lag. Timing is the key in investing in small caps as they are the breeding ground for multi baggers and we strongly believe that this is the right time for investors to invest in Small Caps with an investment horizon of 5-7 years".