TMFs and the art of investing: Mirae MF’s Swarup Mohanty

Swarup Mohanty, 52, chief executive officer of Mirae MF
Swarup Mohanty, 52, chief executive officer of Mirae MF

Summary

Mohanty says he has restructured his debt portfolio and also shifted to art for his alternative investments

With interest rates climbing steeply over the last many months, Swarup Mohanty, 52, chief executive officer of Mirae MF, has decided to restructure his debt portfolio. “I wanted to take advantage of high interest rates as an investor and at the same time reduce interest burden as a borrower," he said during an interaction with Mint for the Guru Portfolio series. In this series, leaders in the financial services industry share how they manage their own money.

Making the switch

Mohanty moved part of his liquid fund investments into target maturity funds to lock in investments at high yields and a part of his liquid fund investments was used to prepay part of his home loan. “The interest rate on my home loan had climbed up to 9.25% in this interest rate cycle. So, I thought it’d be wise to pay part of the home loan to reduce the interest burden," Mohanty says.

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Graphic: Mint

His equity exposure continues to remain at 70%, while his debt exposure (including employee provident fund, public provident fund, etc.) has now reduced to 15% of his overall portfolio, which was 25% earlier.

Over the next 5-6 months, he is targeting to replenish his liquid fund reserves. For the time being, he says his equity portfolio should help with any contingency. He has 5% of his portfolio in physical gold.

Alternate investments

Mohanty had got into alternative investments by investing in a couple of startups in 2020 and 2021 but didn’t find many opportunities in the startup ecosystem over the last year.

According to a report by PwC India, the overall startup funding in 2022 stood at $24 billion, which was a drop of 33% compared to previous year. There has been a general sense of caution among both startup founders and investors where it concerns deal-making.

In view of the lack of opportunities in the startup ecosystem, Mohanty added art to his alternative investment portfolio“My wife is leading our art investment portfolio. She has taken a lot of interest in this and is doing research to understand different artists, their works, etc.," Mohanty says.

“Indian art market is quite vibrant and fascinating. There is even transparency in terms of pricing. For example, the same artist will fetch a consistent price across the country. The only thing that matters is that the work should be authenticated and that’s where the art gallery and art curators come in. For us, this could be the beginning of an enriching journey as art investors," he says.

Mohanty regularly discusses investments with his wife. “My wife is well aware of our portfolio and our approach to investing. We regularly discuss our investments when we review it," he says.

Other investments

In the past year, Mohanty wanted to increase his international exposure as share of his overall portfolio, but he couldn’t do it in view of the international investing limits for mutual funds.

In January 2022, the Securities and Exchange Board of India (Sebi) asked mutual funds to stop accepting fresh flows into international mutual fund schemes investing in overseas stocks, following directions from the Reserve Bank of India. In June 2022, Sebi gave some headroom to international schemes to accept flows and invest in stocks listed on foreign exchanges, but only up to the extent of the investments that were redeemed by investors since the restrictions were imposed.

Since Mohanty’s other investments have either grown or remained intact, the share of international exposures in his overall portfolio has reduced. From 10-11%, it has dipped to 5-6% of his overall portfolio.

Within equity, Mohanty continues to stick to large and mid caps. He doesn’t want to take on the risk of small caps as this portfolio is meant for his retirement corpus.

Almost 85-86% of his total investment portfolio is in Mirae MF’s schemes. However, Mohanty was able to make some investments on the personal front.

Lifestyle changes

A passionate music lover and an audiophile, Mohanty could finally realize his dream of putting in place a proper music system at his house. He used some gains from his equity portfolio to buy a Thorens turntable, a Mcintosh amplifier and other high-end audio gadgets required for such a music system.

Advice for investors

What is Mohanty’s advice to investors amid the current market dynamics and changes in taxation rules?

“There is a law maker and a law follower. Investors fall in the second category. So, there is no point debating it," he says.

As far as Indian markets are concerned, he says investors are spoilt for choice in the Indian equity markets as “this is the best structural story that is starting to play out for the long run".

He says this is a good opportunity for equity investors who are in the accumulation phase; even international equity is available at attractive prices, he says. “Debt markets don’t have as many cycles as equity, but there can be opportunities at different points in time. This is a good opportunity for investors who don’t have adequate debt exposure to fill that part of their portfolio and lock in investments at higher rates," he adds.

However, Mohanty cautions that investors need to stick to their investment goals, without getting too emotional as the news flow may not necessarily be positive in the near term.

Mohanty, a wildlife and travel enthusiast, has some holiday plans for this year. He wants to visit Tadoba National Park, a tiger reserve. He also plans to travel to Japan and South Korea.

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