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PPFAS Mutual Fund’s first unit holders’ meet held in Chennai on Saturday reinforced its CEO Parag Parikh’s resolve to challenge the status quo of the country’s mutual fund industry. This is the first time ever that unit holders of a scheme were invited to discuss its performance with the fund management team.
Self-scrutiny time “But for you (investors), we would not have had this opportunity. So we decided to hold an annual general meeting every year, where we will subject ourselves to scrutiny,” said Parikh, addressing a large group of unit holders at Taj Connemara, here.
Reiterating PPFAS MF’s investing philosophy of ensuring preservation of capital and earning a reasonable rate of return, Parikh reassured unit holders that the fund house will not launch another scheme and confuse investors. From special situations such as mergers and acquisitions, open offers to arbitrage opportunities and global themes, the fund has capitalised on every opportunity available in the market, he said.
Innovative detour “We picked up courage and decided to have just one scheme,” said Parikh. “We do not follow others in the MF industry in chasing assets under management or having a large sales team to do so. The company has gone against the current industry practice wherein the fund house’s sales team identifies and designs the hot selling theme, he added.
“We don’t want to sell the scheme, we want you to buy. You will buy only if the performance is good over a period of time,” he added.
All the 45 employees of PPFAS MF have invested in the fund. “This makes sure that there are automatic checks and balances. Since every employee is an investor too, there is a readymade risk management system in place,” he added.
Best hedging tool Asserting that equity MFs are the best hedge against inflation and the most tax-efficient way to benefit from special situations such as open offers, he urged investors not to get perturbed by short-term volatility.
“You have given your money to professionals, so don’t worry about the ups and downs; stay invested,” he added, hailing equity MFs as a great investment for the poor.
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