The Mutual Fund Show: Exploring WhiteOak Capital's Special Opportunities Fund Strategy
A Special Opportunities Fund primarily seeks opportunities arising from distinct events, where stocks are trading at a price lower than their true value.
In an interview to NDTV Profit, Manuj Jain, co-head of product strategy at WhiteOak Capital, discussed the characteristics of the fund house's Special Opportunities Fund, highlighting its active management and focus on seeking opportunities from "special situations" within the equity market.
According to Jain, these "special situations" occur when stocks are trading below their true or fair value, presenting opportunities for the fund. He emphasised that the fund's strategy often involves contrarian bets on stocks or sectors undergoing such situations, which can be either negative or positive events.
The types of events that WhiteOak Capital's Special Opportunities Fund targets include those influenced by geopolitics, affected by natural calamities, or experiencing temporary unique challenges.
Amit Kukreja, a financial advisor, described the fund as a special opportunity product aimed at creating alpha for investors through value-driven ideas. He mentioned the fund's focus areas, which include corporate restructuring, government policy changes, technological disruption, and emerging sectors.
Regarding the fund's performance, Kukreja acknowledged its track record of delivering decent value over the past few years while also suggesting that other products in the space have shown similar promise.
Kukreja also answered some viewer queries on the show.
Query 1: I want to start an SIP of Rs 3,000 each in 10 mutual funds for the next five years. Can you recommend the necessary funds for my portfolio?
Name: Pranab Gupta I Age: 62 years
Amit Kukreja: Having an accumulated sum of Rs 1 crore is an unrealistic expectation. It isn't feasible to achieve Rs 1 crore with a total net investment of Rs 18 lakh in five years.
Query 2: I have invested Rs 4.32 lakh lump sum in mutual funds, Rs 13.33 lakh in Sukanya Samridhi Scheme, Rs 3 lakh in sovereign gold bonds, Rs 8 lakh in fixed deposits and Rs 2 lakh in the RBI floated bond. Will these investments aid in achieving my goal?
Name: Laxmi Narayan I Age: 42 years
Amit Kukreja: We don't know the specific time frame she aims to amass Rs 3 crore. Therefore, it's challenging for us to predict if she will reach this financial goal. She requires a high quality flexi-cap, mid-cap, multi-cap, and a few index funds.
It is advisable to limit the number of mutual funds to a maximum of six. To reach the target of Rs 3 crore in 18 years, consider consolidating SIPs into a smaller selection of mutual fund schemes, with monthly contributions ranging from Rs 15,000 to Rs 20,000.
