Consistency not a landmark!

There are 2 ‘good’ or ‘great fund managers’ in India. They have (had?) a great reputation for fund management. However I am not naming them for obvious reasons.

One if a fund manager with one of the top fund houses. On television he makes statements which are either completely off the mark or hurtful to the end investor. Fund managers have a ‘buy‘ only portfolio and sitting on cash is not something that a fund manager should do. However maverick fund managers sit on cash – and ruin the clients’ portfolio allocation. If you are a big investor in mutual funds – especially with fund managers who sit on cash – your total portfolio allocation in cash could be much higher than you think! This fund manager was also complaining about the ‘high priced’ IPOs – that was a joke, and a cruel one at that!

Another huge wealth manager who wears many hats was just as amusing on television. When he wears a Merchant Banker hat he tries to get the best price for the IPO. When he wears a wealth manager hat he looks for the same share at a much lower price. This is funny – especially if such people come on television for personal gain. Watching television is getting more and more hazardous especially after the research report on Jim Cramer. Search on Google and you will find the report.

Obviously no names please. I personally have met these people – and find it difficult to know when he is wearing a wealth manager hat and when a MB hat. Once upon a time I would pick ALL his IPOs. Now I avoid ALL his IPOs. In most cases his office on the WM side gives ME a buy call far below the IPO price. Really there will not be much left on the table, nor are they sure about the long term prospects. In one case the guy doing the research was asked for 90-day call on a particular scrip – clearly the question being “Will it list at a premium? Or will it devolve?”.

God bless the small investor. God bless SEBI.

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