JioBlackRock AMC on expanding its systematic equity playbook

As JioBlackRock AMC expands its systematic equity offerings, it is shifting its focus, from stocks to sectors. After introducing its FlexiCap fund in October 2025, the fund house has now launched a sector rotation strategy that seeks to capture relative sector performance using the same data-, AI-, and research-driven framework. “With FlexiCap, the objective is very clear - generating alpha through stock selection. Sector rotation uses the same platform, but the alpha engine is different,” CEO Sid Swaminathan said. In conversation with Moneycontrol, Swaminathan explains why it is a complementary strategy to their flexi cap fund and the AMCs plans beyond mutual funds - from SIF to GIFT City. You have launched a sector rotation fund, which is a niche category. Why choose this as your second equity strategy after FlexiCap? We actually see FlexiCap and sector rotation as very complementary strategies. With the FlexiCap fund, we introduced BlackRock’s systematic active equity platform to India, combining data, AI, and human decision-making. The objective there is very clear, generating alpha through stock selection. Sector rotation uses the same benchmark and the same data, AI, and human framework, but the alpha engine is different. In this case, alpha is generated by predicting how one sector will perform relative to another. Within sectors, we aim to remain neutral on individual securities and other factors. Although the alpha engines are different, the benchmarks are the same. Together, these two strategies offer a powerful and complementary combination for investors. The fund fills the gap of (finding) sectoral alpha. Events such as budgets, tariffs, and macroeconomic changes affect sectors differently. While FlexiCap focuses on alpha from stock selection, the sector rotation fund focuses on capturing alpha from sectoral shifts. This provides investors with an additional and complementary source of return. How does the sector rotation fund works and why it is relevant in current market conditions? Indian equity markets have evolved significantly over the last few years. The number of companies coming to market has increased, the range of sectors has broadened, and no single sector dominates the market. This diversification is very supportive of a systematic, data-driven strategy like ours. At the same time, market depth has increased as capital markets have matured and trading volumes have grown. This is important because our strategy combines slower-moving fundamental insights with faster-moving alternative data, which leads to more frequent rebalancing. Deeper markets allow us to execute these changes while managing transaction costs. These conditions have supported similar strategies globally for BlackRock over multiple decades, and we are seeing the same dynamics emerge in India. How do you manage risks in such a fund? We avoid large, concentrated positions in any single stock or sector held for extended periods. We take multiple smaller active positions and rebalance more frequently. This approach reduces concentration risk and allows us to generate alpha in a more consistent and risk-managed manner. As a result, active risk relative to the benchmark is carefully controlled. We will review the portfolio on a monthly basis. That does not mean that the portfolio has to be rebalanced every month. The models generate new insights regularly, and the fund managers act only when the changes are material. We do not create churn unless it is warranted. What’s next for JioBlackRock AMC? We are expanding across several areas. We have launched model portfolios on our platform, received SEBI’s NOC for our SIF, and are working toward a launch in the coming months, subject to regulatory approvals. We are also preparing to launch ETFs, which are a core part of BlackRock’s global offering. In parallel, we are setting up operations in GIFT City to enable both inbound and outbound international investing. Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.