How is Samco Flexicap Fund Different?

Paras Matalia

Jan 20, 2022 • 3 min read

The one term that defines Samco Mutual Fund perfectly is Anomaly, which refers to something that deviates from what is standard, normal or expected. When Samco Mutual Fund was conceptualised, we weren’t interested in doing what our predecessors had already done.

We weren’t interested in following the herd or maintaining the status quo. We wanted to stand out. For even at the inception stage, we knew that our mutual fund offerings would bring about a revolution in the Indian mutual fund space. And our first scheme, Samco Flexi Cap Fund is set to do just that… redefine active management.

But exactly how different is Samco Flexi Cap Fund? Let us understand how and why Samco Flexi Cap Fund is a breath of fresh air in the crowded Indian mutual fund space.

1. Proprietary HexaShield-tested investing framework

Our fund managers of Samco Flexi Cap Fund aren’t buying random stocks based on random hunches. Instead, the portfolio is built on a proprietary HexaShield-tested investing framework. It combines top-down and bottom-up research in the investment management process. The goal is to identify truly HexaShield-tested companies that are innovative, efficient and resilient across markets and geographies.

Companies are strictly selected only from a universe of 125 HexaShield-tested companies. Most other asset managers are invested in 400-600 stocks across market capitalisations.

2. Truly Global Exposure

The term ‘global’ has been grossly misused to represent only the US markets. So, when a mutual fund claims to invest globally, they restrict their stock selection to the American markets only.

But when we say that we will be investing 35% of the corpus in global markets, we are not restricting ourselves and our investors to just the US markets.

No! Samco Flexi Cap Fund will invest in companies across the globe that includes European, Japanese and APAC (Asia-Pacific) companies besides investing in India.

3. High Growth Potential Companies

Let us make it clear from the onset, that we are not looking to make money from price-to-earnings (PE) multiple expansion. And Samco Flexicap Fund is not a value fund by any means. The fund’s focus is on investing in only those companies that have the ability to grow aggressively and compound wealth in the long-run. So, don’t be surprised if we buy a stock with a high PE multiple. We don’t mind paying the extra buck to acquire a high-growth resilient HexaShield-tested efficient company.

4. Truly Active Fund

Samco MF is India’s first asset management company (AMC) to disclose active share. At all times, Samco Flexicap Fund will maintain an active share of 80-85%. This shall ensure that investors get a truly differentiated fund and not an index hugging fund when they pay for asset management fees.

5. Synergy between Diversification and Concentration

You may find portfolios that invest in minimum 50-60 stocks. This can be because the fund manager wants to play it ultra-safe or because his investment filters are not comprehensive enough to consolidate the investible universe.

In either of the cases, you are left with an over-diversified fund that will do more harm than good. But with Samco Flexi Cap Fund, we will be investing in only 25 HexaShield-tested companies. This will give investors both, ample diversification and reasonable concentration.

6. Complete Transparency

Remember, I mentioned in the beginning that we are here to change the status quo?
Well, Samco Flexi Cap Fund is India’s first fund to disclose Voluntary dealing costs (VDCs). SAMCO Mutual Fund would ensure minimal portfolio turnover and therefore low voluntary dealing costs. The differential in VDCs vis-à-vis the industry could be significant to the extent of 1-1.5%. This will also contribute to the funds’ performance.

7. Equity Fund Portfolio

Samco Flexi Cap Fund is an equity fund. The entire fund's corpus would remain fully invested in equities. Samco Flexi Cap Fund will not undertake any debt exposure, derivatives, or hedging and will remain true to the label of being an equity fund.

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