Quantitative funds offer a data-driven approach to stock selection, appealing to sophisticated investors seeking diversified strategies. SBI Mutual Fund and Motilal Oswal MF are set to introduce new quant funds, reflecting a growing trend in the market. These funds utilize rule-based models, devoid of human biases, but may struggle to adapt quickly to market changes. While ideal for seasoned investors with a higher risk tolerance, they may not be suitable for new or first-time investors due to their complexity and potential volatility. Understanding one’s risk profile is crucial before allocating up to 10% of an equity portfolio to quant funds, emphasizing a long-term investment horizon.
Navigating Quantitative Funds: A Data-Driven Investment Avenue
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