Investment Trust of India Long -Short Equity Fund (ITI) is reducing exposure to cyclically sensitive sectors like financials and automobiles.

“Markets will have to reassess whether economically sensitive sectors, whether the expectation of earnings growth is probably overdone and therefore it will have to kind of step back and take a little lower earnings estimate as it is already considered. So, that is really where the market is positioning itself. Tactically we can reduce our positions to these economically sensitive sectors until greater clarity comes and that is really what we are doing. We are reducing our positions or exposure to these cyclically sensitive sectors and focusing more on ones which don’t have to depend so much on the economic cycle recovery,” said Rajesh Bhatia, MD & CIO of ITI.

He also said that central banks across the globe, including India, are willing to trigger economic growth and hence companies that are a play on global growth, are placed better.

“One thing which is common across central banks and governments, and that is true for India as well, is they are doing whatever it takes to jump-start economic growth. So if there are companies that you can find which are a play on global growth, even better. One of them is IT, but you can also have metals and some of the auto ancillaries which are a play on this rebound.

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(Edited by : Abhishek Jha)