Overview of Quant Mutual Fund
Technology has grown over time but what if you can use it for growing your investment? This is possible with Quant Mutual Fund that make investment with the help of algorithms.
The oldest asset management company in the mutual fund industry Quant Fund started in the year 1996. If you have been investing for a long time then you know this AMC also known as Escorts Mutual Fund. In 2018, it was renamed after AMC was acquired by Quant Capital Finance. This was the time when this AMC completely transformed. Instead of relying on human decisions, technology has taken the place for investing.
At present, you can invest in 27 quant funds in India which include 20 equity, 3 debt and 4 hybrid funds. While technology has a strong impact on the economy, it will be interesting to know how quant funds use it for growth creation.
This article will give you a clear understanding of how quant funds work, best quant mutual funds and top features. Lets begin.
What is Quant Fund Investing Strategy?
Before its acquisition, the fund was also using the same strategy of investing as other AMCs. But over the last few years, it totally changed its investing strategy. The fund house uses algorithms to make investments instead of relying on human decisions.
On one side where fund managers pick stocks, the fund house relies on algorithms for investing. This model calculates a large amount of data like mutual funds trend, stock index and company growth. After calculating this data, it selects stocks that have a higher growth potential.
The biggest advantage of this model is more accurate and fast decisions. Sometimes humans can make wrong decisions but this model only picks stocks based on data. This approach of investing gives you an advantage to invest right and make strong wealth.
You know quant fund also comes with a lot of features that you will explore in the next section.
Features of Quant Mutual Fund
The Quant mutual fund unique investing provides so many amazing features that attract investors for investments:
1. Quick Portfolio Rebalancing
Quant funds algorithm-based model is capable of calculating a large number of data in a very short time. This helps to get the early mover advantage by quickly adjusting the quant mutual fund portfolio according to market conditions before others enter.
2. Reduce Errors
The best thing about these quant funds is they reduce human errors by using a machine–based model. While humans make decisions based on emotion and excitement, this model only focuses on data to make investing decisions.
3. Strong Investing Decision
One thing that make quant funds in India famous is its strong investments. Its machine-based model checks many factors like company valuation, market conditions and stock performance. Based on these data, it only selects stocks that have a higher potential for growth.
Now its time to take a look at the best quant mutual fund that is known for their performance.
Top 5 Quant Mutual Funds to Make Higher Returns
If you are planning to invest in quant schemes then these best quant mutual funds in India you should know:
1. Quant Manufacturing Fund
Category: Equity Fund
CAGR: 21.15%
Fund Manager: Ankit Pande
Assets Under Management (AUM): Rs. 804 Crores
2. Quant Momentum Fund
Category: Equity Fund
CAGR: 23.35%
Fund Manager: Sandeep Tandon
AUM: Rs. 1,649 Crores
3. Quant Liquid Fund
Category: Debt Fund
CAGR: 7.45%
Fund Manager: Sanjeev Sharma
AUM: Rs. 1,602 Crores
4. Quant Overnight Fund
Category: Debt Fund
CAGR: 6.84%
Fund Manager: Sanjeev Sharma
AUM: Rs. 171 Crores
5. Quant Absolute Fund
Category: Hybrid Fund
CAGR: 16.39%
Fund Manager: Ankit Pande
AUM: Rs. 1,922 Crores
These funds not only provide growth but also help you to start SIP with a small Rs. 1000 amount. Now see how these funds are safe for your money.
What Makes Quant Mutual Funds a Safe Investment Option?
Investing in quant schemes is great because of these few reasons that make quant funds a safe option:
1. Systematic Way of Investment
The biggest part of quant funds investing is its machine-based model that helps to only invest in quality stocks based on their performance and growth. You can also invest through a SIP plan where you can reduce the risk by investing a small amount at set times.
2. Lower Cost
Instead of relying on fund managers, Quant fund uses algorithms to make investments. The biggest advantage of this approach is a lower expense ratio. Because your portfolio is managed by algorithms, it reduces the cost of management fees.
3. Better Risk Management
It uses diversification to spread your quant mutual fund portfolio into different sectors such as industrial, banks and healthcare which helps to reduce the risk. The amazing thing is it also adjusts your portfolio allocation from time to time according to how the market reacts.
4. Transparency
As an investor, if you want to have proper knowledge about how your investment is doing in mutual funds then investing in quant funds is a great option. It regularly provides updates about how your portfolio is performing which helps you to invest confidently.
After learning the key information about the fund, its time to conclude this article.
Final Thoughts
To wrap up all together, the Quant mutual fund investing model provides a powerful way of investment. Its quantitative model uses algorithms to make investing decisions which increases growth and reduces the risk. By using this investing approach, the Quant fund house gained the attention of so many investors. You can understand its popularity by seeing its investor base which is more than 80 Lakh investors like you.
One investment plan that most investors use to invest in these funds is a SIP. This plan helps you invest a small amount at a fixed amount rather than investing a large sum. Because you are investing a small amount at a set time, you can prevent from losing a large sum of money.
