On August 10, 2021, Canara Robeco Mutual Fund launched its value fund whose subscription will commence between August 13, 2021, and August 27, 2021.
About the scheme:
Canara Robeco Value Fund (CRVF) will initiate the value style of investing. Nimesh Chandan, head-investments, equities at Canara Robeco MF, said that “The fund will look for opportunities in sectors and companies that are mispriced due to heightened market reactions.”
Chandan indicated that the value investing will follow a significant growth in future for the company, but also consists of a conservative estimate of growth due to potential errors while visualizing future growth.
What is value investing?
A value fund will search for companies with an absolutely perfect record and no underperformance on the required grounds. It is because a company with no erroneous records will have a higher intrinsic value than others. The line of difference between market value and intrinsic value gives the exact line margin of safety. Using this, the value investors can lower the additional pressure on their investments in case if wrongly estimated.
Vishal Mishra, fund manager at Canara Robeco MF, averred, “We will be prioritising investment opportunities in companies with near-term triggers so that values can be realised sooner.”
What is the perfect estimate of an investment horizon?
Value funds witness a prolonged period of underperformance due to an untimely realisation value of a stock. Nisreen Mamaji, the founder of MoneyWorks Financial Services, said, “Anyone looking at a value fund should have a long-term investment horizon.”
“In value funds, the value-discovery can happen in the latter part of your investment period. Investors should also be prepared for higher volatility,” she added.