ICICI Prudential PMS Value Strategy aims to follow a value investment style and intends to offer a diversified portfolio of stocks that have a high potential but are quoting at a discount to their fair/intrinsic value.
The core investment philosophy of value investing is based on the belief that stocks cannot continue to quote at values that are significantly below their fair values over the long term. At some point in time, the markets are likely to recognize the extent of undervaluation of these companies. The same could lead to a rerating/appreciation in the company’s stock price.
There are various reasons why stocks tend to quote at low valuations. Some of these include:
The Portfolio Manager aims to find a good business at a reasonable price and not a mediocre business at a bargain price. The Portfolio Manager endeavors to invest in securities with:
The Strategy aims to follow a “buy and hold” strategy in order to fully capitalise on the true underlying value of the business potential which gets “unlocked” over a period of time. However, the portfolio may be actively managed to take advantage of certain market trends, with an endeavour to enhance returns.
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