Gold Is Out, Equities Are In For WhiteOak's Multi-Asset Fund, CIO Explains
This shift, as explained by Ramesh Mantri, chief investment officer at WhiteOak Capital, is a call directly based on their quantitative model.
WhiteOak Capital's multi-asset fund is primarily focused on low volatility over aggressive returns and recently made some notable changes in its portfolio. The rebalancing has brought about a substantial reduction in gold exposure.
This shift, as explained by Ramesh Mantri, chief investment officer at WhiteOak Capital, is a call directly based on their quantitative model, which continuously evaluates the attractiveness of various asset classes. The fund relies on the model to guide its calls on allocation across asset classes like gold, equities and debt.
Mantri elaborated on the fund's approach to gold, recalling a period where the precious metal held a more prominent position.
"In the last year at some point we had 4% in gold, when it was very attractive among asset classes," he told NDTV Profit in a conversation on Wednesday.
This was during a time when gold was experiencing a rally, delivering some of its best years. Soon, the assessment by their quantitative model indicated a change in gold's value.
"Since then, gold has rallied, recording the best years. Then we saw that gold is overvalued and less attractive than equities or debt, so we have significantly cut exposure," Mantri explained, pointing out the rationale behind their decision.
With this rebalancing, WhiteOak's multi-asset fund by the end of April recorded its lowest exposure to gold. At the same time, the fund strategically pivoted towards equities, reaching its highest allocation in this asset class within the last two years.
Mantri also added that the net equity is close to the highest to what they have had in the last two years. So, between these two high-growth asset classes that are equities and gold, Mantri said that the fund has the lowest exposure to gold and highest to equities this point of time.
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