ETMarkets PMS Talk | China, Brazil, silver and tactical rotations help Vallum beat Nifty; true multi-asset needs global flexibility: Manish Bhandari

After a volatile start to 2026 that saw the Nifty50 slip over 3% in January, Vallum Capital Advisors’ Multi Asset Index Strategy stood out with a near 10% gain.

In this edition of ETMarkets PMS Talk, Manish Bhandari, CEO of Vallum Capital Advisors, explains how calculated global bets on China and Brazil, a contrarian allocation to silver, and timely sector rotations helped the strategy outperform.

Bhandari argues that true multi-asset investing goes far beyond the conventional mix of equity, debt, and gold. Backed by a global macro framework, flexible asset allocation, and a value-biased approach, Vallum’s PMS strategy actively shifts across geographies, sectors, commodities, and factors to capture emerging opportunities.


He also shares why Indian portfolios carry excessive home bias, how regime-based allocation drives alpha, and why flexibility — not rigid asset caps — is key to delivering superior risk-adjusted returns over the long term. Edited Excerpts –

Q) Thanks for taking the time out. Your Multi Asset Index strategy delivered nearly 10% return in January 2026 compared to over 3% fall seen in the Nifty50 index. Wat led to the outperformance.
A) Thanks, Kshitij, for this opportunity to express our views on Vallum Multi Activa Approach. Our calculated and thoughtful bets last year in China, Brazil and Silver, helped in the performance of the approach.

We made allocation to beaten down sectors like consumption; Top 10 equal weight have contributed to this Outperformance. My team members were able to identify opportunities in China, which was undervalue relative to other opportunities, Brazil, when interest rate cycles were very high there and equity highly undervalued.

Similarly, when silver was a screaming buy after 27 years of underperformance relative to gold.

Recently, we made two investments PSU Bank Index, as PSU banks are growing faster than Private banks, Second IT Index, sensing that investor are overreacting on impact of Anthropic AI on the Indian IT services companies and Metals Index, on back of contraction in supply from China.

Our deep top-down research has given us lot of flexibility to react to the changing circumstances which is not with the traditional Multi Asset Funds, fixed with gold and silver as part of diversification.

Q) The strategy aims to beat the NSE Multi Asset Index over 3–5 years net of fees. What differentiates your approach from traditional multi-asset mutual funds in achieving this goal?
A) Vallum Multi Activa approach (VIMAS) is differently positioned as it has holding across asset classes while traditional Mutual funds are swinging between gold and equities. VIMAS differentiates itself from traditional domestic multi-asset mutual funds by adopting a sophisticated global macro perspective, enabling granular allocations across diverse sub-asset classes rather than limiting to the typical trio of equity, debt, and gold/silver.

Within equities, we deploy factor-based funds, thematic investments with sector rotation decisions, and significant global equity exposure to capture international themes and opportunities.

Our commodities sleeve extends beyond gold/silver to include base metals, broader commodities, and precious metal miners, while debt incorporates multi-country yield curve strategies for enhanced flexibility.

In contrast to domestic multi-asset funds, which maintain predominantly India-centric holdings, VIMAS allocates substantially more to international markets, allowing us to navigate global cycles and diversify beyond local constraints for superior risk-adjusted returns over 3-5 years.

Q) Why PMS Structure have edge over MFs for Multi asset?
A) VIMAS attempts to diversity investors asset to the best possible opportunities and not boxed in rigidities. It has advantage on taxation, Investors are taxed based on their holdings, hence not forcefully owning one asset class to circumvent taxes. Multi Asset Funds have a separate taxation slab. LTCG = 12.5% after 2 years of Holding and STCG = Slab Rate of Investor.

PMS Funds are not pooled investment vehicle hence India equity structure are taxed as normal Long Term Capital gain at 12.5% over one year while Short term is at 20% for less than one year. Foreign ETFs and Funds are 12.5% over more than 2 years. Securities are held in Individual DEMAT Accounts.

Q) With allocation flexibility ranging from 0–100% across equity, debt, commodities, and global assets, how do you decide the right mix at a given point in time?
A) By applying Asset allocation frame work.
1. Global asset allocation,
2. Local asset allocation framework

Our asset allocation decisions at VIMAS follow a multi-layered framework that integrates quantitative models and qualitative insights to navigate country-specific, sector-level, and macro regime dynamics, ensuring the shift of 0–100% mix across equity, debt, commodities, and global assets at any given time in order to generate alpha over normal indices. it can seamlessly move from Large cap to Mid cap or Small cap, Value to Growth and Local Equities to Foreign Equites.

We reject rigid asset class caps, instead crafting portfolios around prevailing macro regimes framework, using sector rotation, Quantitative tools, tactical tilts, while qualitative overlays from central bank policies and geopolitical events refine the mix, always bounded by strict risk management parameters like volatility targets and drawdown limits.

Multiple Quantitative Macro Ratios, Yield curves, rates, Global Etfs screens, Currency screens and many more. This regime-based approach delivers superior risk-adjusted returns versus the NSE Multi Asset Index over 3–5 years net of fees, adapting dynamically without constraints typical of traditional multi-asset funds.

Q) The Asset Quilt clearly shows leadership rotation across asset classes. How do you practically position ahead of these rotations rather than reacting after the move?
A) Our approach is suitably positioned to do asset class and domestic sector rotation. let me give you example, today approx Rs ~79,000 cr is invested in US denominated assets by the Indian investors thru MFs, and ETFs. Most of the money is in technology theme in the US.

Recently investor got taste of volatility in this overcrowded asset theme and its drawdown. We have zero exposure in the US exposed MFs/ETFs in Vallum Multi Activa and have warned investor about investing in the US.

Frankly, we attempt and aspire to position overselve ahead of such rotation, but challenge is that investor should appreciate that they should hav patience of 3-5 years.

As manager we are value biased hence will look for out of flavour sectors or theme which would play out in mid term, not in short term. Silver is classic case of a commodity which did not moved for decades and move decades in weeks.

In order to position ahead of asset class rotations evident in the Asset Quilt, VIMAS employs a forward-looking surveillance framework & Indicators that monitors global market signals across equities, bonds, currencies, and yields for major economies, identifying inflection points before momentum fully shifts.

Vallum team drill into micro structures—equity sectors, yield curves, currency, and commodity as well as country—to catch that inflection/deflationary/expansionary points and try to position itself where regime changes.

This enables preemptive tilts: overweighting & Underweighting on assets/themes/factors/countries, validated by quantitative and qualitiative screens.

Q) The correlation matrix shows relatively low correlation between India and several global markets. How much home bias do Indian investors currently carry ?
A) Total money invest in India, Various BMs. Correlation between Nifty50 and various thematic funds 3 yr basis.

Today 80% plus of assets of Indian investors is residing in Indian equity markets. Vallum Multi Activa (VIMAS) attempts to diversify investor wealth on Asset allocation (debt, equity, commodities), Style, Factors, Themes available in India. A classical top down macro call based approach to investing.

It is unconstrained and does not tie tightly itself to benchmark. It explores all the possible structures to make money for investors.

PMS structure allows that flexibility for investors to diversify away from traditional benchmarks and explore value add to these indices. The foreign equities or precious metals or commodities are least coo related to Indian assets.

Indian Investor AUM is heavely correlated to nifty 500 as 80% of total Equity AUM (46Lakh Cr) is sticked to these 18 benchmarks which keeps rotating within Nifty 500 Stocks -

Q) How do you manage currency risk while allocating globally?
A) We are relying on the respective funds and ETFs to do the currency risk management. We can't do much about it as once invested Fund manager will manage the currency risk.

Usually there is cross currency movement, as fund is subscribed in INR, this gets converted into USD as they are listed on US exchanges and money is transferred into respective country in home currency.

Same things is reversed when we redeem the fund. Hence all these funds carry huge currency risks.

Q) Silver and global ETFs form a meaningful part of the portfolio. Is this tactical or structural positioning?
A) Unfortunately, in India Multi asset is sold as Equity, Gold or Silver. There is so much more to such funds. You always have choices of miners apart from Gold and silver but there are many occasion where gold has not done well for 3 yr in a row.

Investors’ need to be mindful, today all multi asset looks good based on last yr return. However, two yr of underperformance of gold and silver v/s BSE 500 lead to underperfomance of such funds relative to markets.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)