Devina Mehra, a market expert and the founder of First Global, has criticized average fund managers for not being data-driven, which negatively affects their performance and, in turn, investors.
Mehra highlighted the inconsistency in views among fund managers and market commentators, especially regarding government stability and its impact on the economy and markets. On X (formerly Twitter), Mehra pointed out that some fund managers and well-known investors have changed their opinions based on changing political scenarios.
“Until recently, they believed that the incumbent government needed a strong majority for positive economic and market outcomes. Now, the same individuals claim that minority and coalition governments are beneficial for the stock market and the macroeconomic outlook,” Mehra wrote.
Bias and Lack of Data-Driven Decisions
She explained that while coalition governments can indeed be good for the market, historical data on this has always been available. She questioned how these fund managers suddenly realized this in just 24 hours.
Mehra emphasized that most people struggle to separate their incentives or political biases from objective data. She stated, “Whether blinded by their biases or incentives, these reversals indicate that the average fund manager is not fact- or data-driven. This ultimately affects their performance, which hurts investors, not them.”
Advice for Investors
A week ago, Mehra posted on X about her positive outlook on the Indian stock market in the medium term. However, she warned that the market might experience short-term volatility. To address this, she advised staying fully invested while using hedges to protect against potential downturns. Although this strategy might incur costs, she considers it a prudent approach to avoid significant losses.
Mehra stressed the importance of staying invested to benefit from market gains, noting that missing just one of the best days each year can drastically reduce overall returns.
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