 
Prashant
Jain ANOOP
BHASKER RITESH
JAIN |
PLAYING TO WIN Listen
to what the market says and you will outsmart your opponents without
a sweat, says Sandesh Kirkire For the CEO of Kotak Mutual Fund, managing a fund is like a race that you try to win against your peers. Comparing his stints in investment banking, treasury and fund management in a career spanning sixteen years, he says that managing public funds has been the toughest as there is a “performance appraisal on a daily basis”. Since you are part of the game and there are other players what do you do to outwit them? In the markets, you are perhaps your own best friend or worst enemy. When things go wrong the market will point it out to you. “You have to reassess the situation and cannot get carried away with your own views. Keep your ego in check or you will be killed,” says the mechanical engineer and management post graduate from Jamnalal Bajaj Institute of Management Studies, Mumbai. In addition to assessment, to survive you also need to be able to read market signals. The market, according to Kirkire, is the summation of all views and can give you important clues. “Regulators keep giving you hints in pre-policy announcements and you need to be able to catch it to benefit your fund,” he says. Kirkire who took over as the CEO a year and a half ago believes there is no formula for successful fund management. Instead, clear internal processes and tight investment mandate per scheme make the investment process objective. “Continuously refining processes help you in avoiding the mistakes you have made in the past,” he says. Another way to cut out errors is to go up the learning curve. Kirkire does this by keeping himself updated on happenings in the investment sector. Two of his favourite books are Infectious Greed by Frank Partnoy and The dollar crisis by Richard Duncan. For Kirkire who wants to expand and make Kotak a global brand, managing a fund is all about stock selection and asset allocation. For debt, the asset allocation call is driven by the broad view on the interest rates while stock selection mainly comprises the credit risk that the fund can take. “While macroeconomic factors such as liquidity, credit pick up, government borrowing and inflation helps you take an interest rate view, credit risk assessment could lead to credit migration and you have to get this call right before the rating agencies and the world wake up to it,” he says. And mistakes on this count can prove to be very costly. “A single default can be a major impact on a fund,” says Kirkire adding that the fund has limits across rating category as also at the scheme level. For
Kirkire who always wanted to head a company and bet his future in
the financial services field, what’s next? He would like to
use his experience and knowledge of the markets to play out the
role of a regulator and help in framing policies that will grow
the market. And his piece de resistance: The market is a great leveller.
Don’t try your luck against it. Sense the direction and ride
it. • HOME Business Standard • FUND MANAGER • October 2006 |
