MBAP logo

Portfolio Management & Being Agile

Adani Institute of Digital Technology Management (AIDTM)

By Dr. Darshan Ranpura
Assistant Professor at Adani Institute of Digital Technology Management

“The ability to manage uncertainty and be comfortable with uncertainty is a key difference between waterfall and agile.” ~ Agile Portfolio Management

While discussing with one of my colleagues about rapid change and adoption of new edge technology and tools, he brought up an interesting point that the adoption of “Agile” project management methodology played a catalyst role in this process. Later, I tried to understand more about the concept of “Agile (able to move quickly & easily)”, which allows teams to collaborate on complex tasks and built new solutions/services through a continuous process of customer feedback and product iterations.

At first, for instance, though the concept of agile looks only for project management tools there are many ways, we connect the agile method in the investment management process too. Let’s say, as a portfolio manager assessment of complicated and ever-changing market fundamentals became more significant. i.e., During the last 50 years, the lifespan of a company on the S&P 500 index dropped from 67 years to 15 years and this lifespan difference is shrinking.

To match up with ever-changing market scenarios, the portfolio management members of the investment team have started to follow the roles that are largely found among agile teams. Let me put an example of one of India’s fintech start-ups named “Smallcase”.  The research team at Smallcase uses agile tools to offer various portfolio baskets on numerous themes by looking at whether a theme has a large-enough investable universe to choose from, i.e., whether the theme has enough stocks to invest in. Their theme baskets are more flexible and adaptable to market volatility as the research team analysed from ground zero during every quarterly portfolio rebalancing activity. Such, agile sprint activities enable them to deliver the highest return to their investors. i.e., the IT Tracker basket has delivered around 25% CAGR for a 6-year period. With available datasets and agile methodology, Smallcase eliminates biases & emotions and ensures that offered theme basket doesn’t suffer from any element of vague subjectivity.

So, with the Agile approach, the investment process can be made clearer and more possible to deliver higher values to investors. Let me end this article here and eager to hear your thoughts.

Adani Institute of

APPLICATION FORM 2022

Digital Technology Management

Adani Institute of

APPLICATION FORM 2022

Digital Technology Management

Reach Us

primary Menu

Inspiring Education… Assuring Success!!

Free Content !!!
Signup now to get the All recent CAT Exam Paper with Solution... Subscribe below with your Email ID
Free Content !!!
Signup now to get the All recent CAT Exam Paper with Solution... Subscribe below with your Email ID