“Large cap is the new debt. Private markets are the new equity,” Edelweiss Mutual Fund MD & CEO Radhika Gupta remarked, referring to a quote she came across. The statement has struck a chord with many, as it captures the evolving risk appetite of investors.
“An interesting quote I heard today that summarises how risk appetite has shifted upwards in the last 5 years, and some asset allocation buckets have been forgotten :),” she wrote on social media platform ‘X’.
Are large-cap equities the new safe bet?
Over the past five years, many traditional asset allocation norms have probably blurred, and investors now seem to be treating large-cap equities as the new safe bet, while exploring higher-risk, illiquid assets like private equity for long-term growth.
In the last few years, the stock markets have given bumper returns, and the new-age investors have started thinking more openly about risk.
Earlier, people used to choose options like debt funds or bank FDs for stability of returns; now, large-cap mutual funds or blue-chip stocks are being given place. These stocks have less volatility, and investors are considering them a ‘safe zone’ for the long term, just like debt was considered earlier.
New investors are now turning to private markets
On the other hand, in search of higher returns, people are now turning to private markets i.e. unlisted companies, startups and alternative investment schemes (like AIFs and PMS).
These investments are riskier than traditional equities and often remain stuck for a long time, but their craze has increased among the youth and high-net-worth investors. Gupta is pointing to this trend that the definitions of traditional asset classes are now changing, and the attitude of investors has become more aggressive than before.
The Edelweiss chief often shares her thoughts and investment tips on social media. In one of her recent posts, she said that her job is to sell SIPs, but she always advises people to not only save their hard-earned money but also spend it on things that give happiness. She believes that life is not just about running after money and portfolios, but about enjoying the sweet fruits of hard work to the fullest.
Her post touched the hearts of many people on social media, and people praised her wholeheartedly. Radhika Gupta believes that investment should not be only in money but also in the beautiful moments of life.