Thread by @shyamsek

"Why does a PMS portfolio not look like a good investor's PF?"
Been asked this question many times. So, I set out thinking what can make a portfolio curated by others special to an investor.

My learnings brought back memories of 2009 when another question began a new journey.

The questions in 2009 - "Why do retail investors always buy MFs at the top, chasing sectors & themes which have already done too well? Why do they exit shortly after at the bottom?"
These questions began my 10 yr journey into MF advisory. Finding answers was fun. So, here I am!

The answers to a very relevant question has to be a solution. The solution must be tried and tested real time (not Back tested). You need to prove it to real investors. The process must be robust, dynamic and transformatory. Learnings must be institutionalised. We did it in MFs.

Quietly, we tested a robust advisory process all along in a few equity PFs. The mandate was simple. A good investor is under no pressure to churn, show profits and cut winners. He builds and holds a PF for years. Is it possible for a professional PMS to replicate that? We tried.

Interestingly, we found that through the period 2009-2019, this approach worked satisfactorily. We chose stocks carefully. They weren't really unknown. But we got them when they were out of favour. Or, valuations were in favour. We bought more if they fell. We held them longer.

The stock we bought were so familiar. Bata, Infy & Britannia were a few very obvious picks. But, we braved the odds even to buy them. This taught us that even in building a PF of known stocks, a difference can be made. A manager can contribute if he shows an investor's patience.

"An investor's patience" was first critical ingredient for our PMS recipe. It was important to view it like a very sound, solid investor would. Do nothing adventurous & let time do the talking.

We saw the results very clearly. A manager showing an investor's patience was rare.

Then to the toughest part of a PMS.

FEES .

Why would anyone pay fees for a lazy PF? With no action, rare profit booking & low churn, can we even charge?

I know what you are thinking.

So, we had an investor experiencing it all along. We kept fees low. He loved it. Thank god.

Who are we up against? We respect other PMS schemes, marquee brands, iconic managers working grt, constantly coming up with brave ideas, bold themes & brilliant moves.

We are no match.
So, we won't play that game.
But, we will play it like an investor.
And keep it simple.

Who should invest with us?
The experience taught us who would like our PMS. It was loved for solid reasons. It cost less than direct option of a large MF scheme. It delivered superior returns with ample peace of mind. And, it looked much more like an investor's PF. That was it.

When must we start? This was the toughest part. We had to wait for a very good time. When we start a PMS mattered. We didn't want bull market AUM. We wanted to begin in tough times, in weaker markets, under lazy sentiment. So, we had no option but to wait out 2016-18. We waited.

We believe Solitaire, our first PMS offering answers that original question. We have put in years of real time effort in curation, framework and testing. Obviously, it is a good time to start now. We look forward to this new journey. An investor's portfolio awaits you. Cheers.