Mutual Fund Show: Every Correction Is An Opportunity To Buy, Says Nilesh Shah

There will fluctuation in mutual-fund returns in India as markets face volatility because of "external factors" but long-term investments will overcome these headwinds, according to Nilesh Shah of Kotak Mahindra Asset Management Co.

Mutual funds offer numerous advantages as long as investors can withstand this "agnipariksha", Shah, managing director at the asset manager, told NDTV Profit on The Mutual Fund Show. "And investors who pass the agnipariksha are sitting on good returns."

Being a robust market, every correction is an opportunity to buy, he said.

Over a five-year horizon, India stands out as the most-affordable emerging market, he said. There is better earnings growth compared to peers, with high-governance standards surpassing most emerging markets, Shah said.

There is a notable commitment to clean transformation, with India ranking as the lowest per-capita carbon emitter globally, Shah said. "Where will we get a combination of these three?"

"When we go out for dinner, we are presented with numerous options and various cuisines," Shah said. The process of selecting a restaurant is akin to choosing a mutual fund—relying on references, experience and brands.

There are two approaches to asset allocation: one involves entrusting it to a professional fund manager, while the other allows an investor to personally allocate assets and choose schemes that align with one's preferences, he said.