Multi Asset PMS strategies demonstrated resilience in September 2024, with a category average return of 2.19%.

Multi-Asset PMSes diversified exposure to multiple asset classes cushioned the impact of equity market volatility, making them an attractive option compared to pure equity-focussed strategies. Top-performing strategies skilfully balanced risk by investing in a combination of equity, debt, and other asset classes, ensuring more stable returns.

Market Overview

September 2024 was marked by volatility across asset classes. The Nifty 50 TRI closed the month with a gain of 2.28%, while multi-asset PMS strategies leveraged exposure to different markets to deliver steady returns. The NSE Multi-Asset Index 1 and NSE Multi-Asset Index 2 posted returns of 1.47% and 1.57%, respectively, reflecting the mixed market conditions.

Equities saw strong sectoral performance in areas like Metals and Financials, while government bond yields remained elevated, with the 10-year Indian Government Bond (IGB) yield at 7.2%. This reflected the global high-interest-rate environment and domestic inflation concerns. 

Nonetheless, steady economic growth supported the demand for government securities, particularly from institutional investors. In the corporate bond space, investment-grade debt remained resilient, though higher yields led to selective issuance among lower-rated companies.

Gold, meanwhile, continued its upward trend, bolstered by expectations of a correction in the U.S. dollar and U.S. Treasury yields. As global central banks, including the U.S. Federal Reserve and the European Central Bank, move towards further rate cuts, gold prices are projected to rally toward $2,700 per troy ounce.

Top Performers in Multi-Asset PMSes

Several multi-asset PMS strategies stood out in September, with Pace Financial's Tresor SKG India Value leading the pack with an impressive 12.02% return. The strategy focuses on aggressive investments in equity, including large-cap, mid-cap, and small-cap securities. Fund Manager Amit Goel’s dynamic asset allocation approach allows the portfolio to invest across equity, derivatives, and other asset classes based on market conditions.

iThought Financial Consulting’s NIO strategy, which posted a 5.41% return, is tailored specifically for NRIs. This multi-asset, macro-focussed PMS brings together stocks, ETFs, and global assets to simplify wealth creation for NRI investors. 

Another strong performer, iThought SPHERE, returned 4.82% in September. Built on time-tested investment principles, SPHERE uses dynamic asset allocation to adapt to changing market conditions. 

Other notable performers included Right Horizons All Seasons with a 2.29% return and Pace Financial's Tresor Flexi at 2.24%. Both strategies demonstrated the benefits of diversification, investing across equity, fixed income, and precious metals.

Analysis of Key Drivers

Multi-asset PMS strategies benefitted from active asset allocation across equities, debt, and other assets, allowing them to navigate volatile market conditions successfully. 

While equities contributed to gains, fixed income provided stability, particularly with government bonds offering attractive yields. Meanwhile, gold added a layer of protection amid global economic uncertainties.

Out of 18 multi-asset PMS offerings, 12 outperformed the NSE Multi-Asset Index 1, with 67% of strategies delivering higher returns than the benchmark. This demonstrates the effectiveness of a diversified portfolio in managing risk and capturing opportunities across asset classes.