India-focused portfolio outperforms benchmarks- GREED & fear

India-focused portfolio outperforms benchmarks: GREED & fear

GREED & fear’s India equity portfolio has outperformed the benchmark Nifty50 and the MSCI India since inception, according to the quarterly review of the long-only portfolios by Christopher Wood of Jefferies.

According to the report, none of the portfolios have been allowed to own cash since inception.

Further, the India portfolio has gained 26.5% on a year-to-date basis, compared to a 8.3% gain in the benchmark. Rising 32.1% since inception, it has outperformed both the MSCI India Index and the Nifty50, which have gained 13.3% and 15.5%, respectively, during the same period.

Jefferies says the long-term performance of its Asia (ex-Japan) thematic portfolio has been “satisfactory”. Since inception at the end of Q3 2002, it had risen by 2,804% in dollar terms, on a total-return basis, as of the September quarter, compared to a 511% increase in the MSCI AC Asia (ex-Japan) Index and a 695% increase in the S&P500.

Essentially, this means the portfolio has risen by an annualised 17.4% since inception, while the same for MSCI AC Asia (ex-Japan) Index and S&P500 have been 9% and 10.4% annualised.

However, the portfolio hit a snag in the last quarter, declining 2.3% on a total-return basis, compared to a 3.2% fall in the MSCI AC Asia (ex-Japan) Index. YTD, it is up 4.4%, compared to a 0.1% decline in the benchmark.

The portfolio “remains primarily geared to the long-term domestic demand story in India”, given that it is 49% invested in India. Besides, it has an 18% exposure to China and another 10% allocated to Taiwanand Korean technology, along with a 10% allocation to energy, resources, and gold.

At a global level, a long-only portfolio was introduced this year on January 19. This was four days before the announcement of Microsoft’s investment in OpenAI (maker of ChatGPT) proved to be a catalyst for the AI narrative to drive Wall Street-correlated global markets for months to come.

The timing was negative as the portfolio had a 66% weighting in Asia-Pacific, of which 23% was on India. The portfolio has gained 0.4% since inception in dollar terms on a total-return basis, compared to a 6.5% gain in MSCI AC World.

Nevertheless, it fared better on a relative basis last quarter, as it declined just 2.3% in dollar terms compared to a 3.3% fall in the MSCI AC World.

In the second quarter, it had gained 6.9% compared to a 6.3% rise in the MSCI AC World.

Hence, the portfolio has marginally outperformed in the past two quarters. At present, it it 68% invested in Asia-Pacific, with a 26% exposure to India.