Holy shit. 8000 crores raised IN NFOs in a month. Look at the schemes, all pointless garbage!

m.economictimes.com/mf/analysis/eq…
If you look closely, 4 out of the 6 top NFOs in terms of money raised are from bank owned NFOs. These AMCs are notoriously skilled at selling garbage funds through their banking channels. They've turned mis-selling into an art. They're are Picasso's of mis-selling
One would be excused for thinking these are intent based allocations by investors which isn't the case. These funds would've been sold mis-sold by any way possible. Bank RMs are incentivized to do so.
Otherwise, in a country where people don't understand a simple mutual funds, expecting people to understand a worthless and pointless ESG fund a d then allocating 1500 crores is a mega stretch. ICICI Pru too had raised 1000+cr for its ESG fund.
The fact that these new funds are raising so much money to me is a negative. In a time like this, where will retail investors find fresh money to allocate? Which means they must doing stupid things like selling other funds.
Look at funds closely. One of the funds are doing anything unique which isn't on offer. Worse yet, many of these funds don't even have an investment thesis, its just pure fluff and gas.
As long as there are gullible investors, AMCs will continue to milk them for all they can. It's not surprising that only about 20-30% of all equity assets stay invested in equity funds for more than 5 years 🤦
To the investors, just because an NFO is available at Rs 10 doesn't mean, you'll become rich. But this stupidity will continue and this is another long pointless rant in a series of pointless rant.
For people who want to listen, remember, what's good for the AMCs is rarely good for the investors.

indexheads.substack.com/p/without-this…
But, I'll bet that that NFO gold rush isn't yet done. AMCs will rush all sorts of nonsense and garbage funds in the coming months. This bull market milking of gullible idiots will continue until this party ends.

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More from @passivefool

25 Dec
Wow, this NFO gravy train isn't stopping

BNP Paribas Mutual Fund has filed to launch BNP Paribas Aqua Fund of Fund. Underlying fund - BNP Paribas Aqua, which invests in companies with a focus on water. Clearly playing off on the hotness of ESG and global

sebi.gov.in/filings/mutual…
The fund has marginally delivered over the benchmark. But the questions is, is it really worth all the hassle? Taking a fund manager risk, theme risk, style risk etc. Sure, you may get paid for it. But it's a hit or a miss.
In my it often pays to keep costs low and keep things uncomplicated as possible. One thing investors might not realize is that this trend of AMCs with foreign parentage or affiliations launching FOFs for useless global funds will pickup steam if the US performance continues.
Read 9 tweets
23 Dec
Rant!

I'm seeing a lot of responses to this tweet about too many traders, punters and so on. Will all due respect, these snappy takes are just plain wrong. It takes traders, investors, degenerate gamblers, Warren Buffett ka baap value investors, idiots like me,
god level forensic accounting stock pickers to make a market. The most stupidest narrative to have come of this post pandemic boom in users among brokers & other investing platforms is this asinine "Robinhood traders" narrative, I had written bout it too.
nakedbeta.com/musings-rants/…
The insinuation is that apparently, there's a horde of day traders, selling their houses, pledging their body organs and are gambling their money away. The replies in the tweet are an extension of the absolutely dumb narrative.
Read 26 tweets
15 Dec
A nobody cares thread.

Nobody cares about the things that matter - getting investors in, helping new distributors advisors, making things (Slightly) easier for investors, honest mis-selling etc.
Nobody cares about direct plans of mutual funds
Nobody cares about about mutual funds either

Very few care about mutual funds. Just 2.1 crore unique investors. If you probably take out HNIs/institutions in this, that's maybe 20-30%, what's left are the common gareeb folks.
Read 9 tweets
30 Nov
HDFC makes over Rs 400 crores in fees (direct plan) from just two of Prashant Jain's schemes. And then add another Rs 300 crores odd as commissions in regular plans.

All this for underperforming Nifty 50 by 4-5% in the last 5 years.
Being a large AMC is a license to print money. After a while stories and fund manager cults dwarf brute numbers and facts.
85% of industry AUM is in regular plans. By my guesstimate, over half of the AUM is not getting the right advice or worse yet is being scammed into useless costly funds.
Read 21 tweets
9 Oct
On second thought, making young people feel guilty about not saving or starting investing can be harmful. When young people are starting their careers, odds are they won't be making much, they should be spending what they can in experiences rather than invest or save.
I used to feel guilty about not starting investing early but on second thought, I probably couldn't have because I wasn't making enough. A good chunk of the financial services industry is based on making people feel like shit for not investing in their mostly scammy high fee
products. I think this has played a big part in deterring investors - the anxiety caused by the money shamers, the guilt of not knowing how to invest, the intimidation and the ensuing guilt as a result of 1000s of funds, platforms, guides, books, gyan, gurus and shit.
Read 10 tweets
16 Sep
Today in re-learning. Most of active fund returns can be explained by factor exposures - Value, Quality, Momentum, Low-Volatility etc.

msci.com/documents/1019…
You can assemble these funds for less than 50-60bps. You can replace all those costly, mostly useless discretionary active funds which most likely are doing what a smart beta ETF (UGG, disgusting term) does and charging on an average 1.2%-1.5%.
Anybody who predicts things is either lying or making a fool oh himself. So I'll make a fool of myself. Globally smart beta ETFs have become replacements for traditional active funds. I predict that this trend will only pick up pace over time.
Read 8 tweets

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