Market volatility to reduce risk & return expectations of investors: ICICI Pru AMC

Today is 7th of the month, which is a Mutual Fund day on CNBC-TV18.

S Naren, ED & CIO, ICICI Prudential AMC said from their perspective this bout of volatility in the market is helpful in reducing the risk and return expectations of investors, especially since they are long-term investors and manage other peoples' money.

He said investors had forgotten the word ‘risk’ and now they will be more careful and think about investing in other asset classes as opposed to just equity markets. The roaring phase of the bull market is more worrying than the current phase, he said.

Talking about earnings season, he said most numbers were in line with expectations. It was expected that every quarter things will improve, he said, adding that along with earnings improvement, one is also seeing interest rates go up. One would be happy to see earnings go up but not interest rates because if they keep going up at same pace then the equity risk premium changes.

He said some of the commercial vehicle companies have reported stellar numbers this quarter.

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CIO- Equity|ICICI Prudential AMC

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When asked if the robust monthly run rate of inflows into mutual funds would slow down, he said investors who thought equities were a risk free asset class might shift to debt funds but the whole financialisation of savings will continue, which means MFs will keep collecting money. As a house, they will be collecting more money in debt, like credit funds etc, he added.

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