Alpha Meets Algorithm: Reimagining PMS for a New Era of Investing

As investors, we live in a world where markets have never been more abundant in opportunity, nor more unforgiving in risk. Global capital flows shift with every Fed announcement, geopolitical flashpoint, or technological breakthrough. In this landscape, the role of active management is no longer about simply beating an index—it is about building portfolios that survive volatility, adapt to shifting cycles, and capture value where others hesitate.

At Merisis Wealth, we’ve spent over 14 years navigating this dynamic terrain. From advising mid-sized growth ventures to structuring differentiated wealth products, our mission has been clear: bridge research with execution, and conviction with discipline. In our recent webinar, Alpha Meets Algorithm, we introduced investors to three of our flagship PMS strategies—each designed not as a one-size-fits-all product, but as distinct approaches to risk and return, grounded in experience and tested by markets.

Understanding Cycles: Why Returns Are Never Linear

Markets do not move in straight lines. Over two decades of managing capital, one lesson has stood out to me: returns are cyclical, and leadership rotates. The very sectors ignored today often become tomorrow’s outperformers. Consider the turnaround of PSU banks—once shunned, now central to India’s financial recovery.

This cyclical truth is the foundation of our Merisis Multicap PMS. By dynamically allocating across large, mid, and small caps, we position ourselves where asymmetric opportunities exist—that sweet spot where the upside meaningfully outweighs the downside. The portfolio tilts toward underappreciated businesses with improving fundamentals, all while embedding a strong margin of safety. It’s contrarian when necessary, patient by design, and opportunistic when conviction aligns with valuation.

The Case for Diversification Beyond Equities

For HNIs, wealth is often already concentrated in equity-heavy assets—public holdings, private ventures, or promoter stakes. That’s why diversification isn’t optional, it’s imperative.

Our Smart Blend ETF strategy tackles this need with a multi-asset, algorithm-driven approach. Unlike static asset allocation models, Smart Blend dynamically shifts across six asset classes—domestic and international equities, gold, silver, debt, REITs, and InvITs. Using a rule-based framework, it evaluates relative strength and allocates accordingly.

The beauty of this design lies in its discipline. Markets provoke emotions; algorithms don’t. By systematizing allocation shifts, we strip away behavioral bias. The outcome is a portfolio that cushions drawdowns during turbulence while still capturing upside when risk-on sentiment returns. Think of it as a countercyclical stabilizer—an approach particularly relevant in today’s environment where global equity rallies coexist with pockets of elevated risk.

Concentrated Conviction: The Catalyst Approach

Not all wealth is built on diversification. Some of it comes from focus, from identifying rare companies on the cusp of transformation and holding them through inflection.

Our Catalyst Series One PMS embodies this philosophy. A concentrated portfolio of 8–13 high-conviction positions, each chosen for identifiable catalysts—capacity expansion, regulatory reform, or business turnaround. This is not a perpetual strategy; it has a fixed 3–4 year tenure. The intent is clear: invest at the point of change, ride the transformation, and exit with outsized returns.

For sophisticated investors willing to tolerate higher risk in exchange for potential asymmetric payoffs, Catalyst provides a structured, time-bound opportunity. It is the closest expression of how we, as fund managers, would invest our own capital when conviction is high.

Where Opportunity Lies Today

Investors often ask: “Where do you see the next big opportunity?” Our current lens highlights several themes, but one worth underscoring is India’s defense manufacturing sector. Since 2020, reforms such as the negative import list and greater private participation have redefined the industry. Coupled with global realignments, India is uniquely positioned to become a key supplier in defense production.

Valuations, admittedly, already reflect part of this optimism. Yet the structural tailwinds—capex cycles, geopolitics, and government support—suggest long-term potential remains intact. This is precisely the type of thematic catalyst we track: where macro reforms converge with corporate execution to create value inflection points.

Integrating Risk into the Process

Markets reward courage, but punish recklessness. Which is why our strategies are designed not just for opportunity capture, but also for disciplined risk integration. Whether it is using volatility indices, valuation bands, or market breadth indicators, our process embeds contrarian signals into decision-making. When fear peaks and valuations compress, we scale in. When euphoria distorts fundamentals, we step aside.

It is this systematic integration of risk signals that allows us to not only ride cycles but also manage them.

Closing Thoughts: Tailored Portfolios for a Complex World

In today’s investing climate, no single strategy can claim to be the answer for every investor. Some wealth needs growth, others stability, and others still require sharp, opportunistic bets. At Merisis Wealth, our role is not just to manage money but to align portfolios with the life stage, goals, and risk appetite of each client.

Alpha Meets Algorithm was more than a webinar—it was a window into how we think about capital, cycles, and conviction. Whether through Multicap, Smart Blend, or Catalyst, the underlying principle remains the same: invest with discipline, adapt with agility, and always respect the asymmetric nature of risk and reward.

Watch the full Webinar here