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Practitioners’ Insights: Fundamental Short Selling

Overview

India has always been a market in which talented active managers apply their stock-picking skills to find wealth-creating businesses. It follows that stock-picking skills also can be used to identify and short wealth-destroying stocks. In this talk, Nalin Moniz, CFA, one of the pioneers of long-short investing in India, shares his insight on applying traditional equity research tools and techniques to generate alpha through short selling. The art and science of short selling will cover the theoretical foundations, practical realities, risk management, portfolio construction, and implementation nuances of this nascent field with case studies and frameworks that are relevant to the Indian market.

Moniz shares his valuable perspectives, which are relevant not only for current and prospective CFA® charterholders but also those for those who are passionate about equity research and who are inclined to enter India’s booming alternative asset management industry.

Learning Outcomes

  • Discuss the theoretical foundations and practical considerations for short selling.
  • Learn to apply traditional equity research tools and techniques to identify overvalued securities.
  • Examine portfolio construction, risk management, and implementation nuances of short selling.

This is the archived version of a live webinar that took place on 18 May 2023

About the Speaker(s)

Nalin Moniz , CFA
Nalin Moniz, CFA, is a graduate of the Jerome Fisher Program in Management and Technology from the University of Pennsylvania (USA), with joint degrees in economics from the Wharton School and in computer science engineering from the Moore School. Currently, Moniz is the CIO of Alternative Equity at Edelweiss Asset Management and was earlier associated with Goldman Sachs Asset Management as a portfolio manager. He had thought of starting his own venture in India by the name of Forefront Capital Management, an alternative asset management firm, but the firm was acquired by Edelweiss in 2014. With a decade and a half of financial experience under his belt, he played a pivotal role in Edelweiss’s acquisition of Ambit Capital’s AIF business in 2016. At Edelweiss Asset Management, he leads the research and portfolio management for the alternative equity funds across AIF, portfolio management services, and offshore platforms, in addition to being the fund manager for the Edelweiss Alternative Equity Scheme. He was a Eureka Hedge Indian Hedge Fund of the Year nominee in 2014, 2016, and 2017 and was voted one of the top 40 under 40 professionals in Indian alternative investments. A marathon enthusiast, Moniz has run races in Amsterdam and Berlin in the past two years. When asked his secret to running 42.195 km, he said, “You run 1 km 42 times.”
Nalin Moniz Picture
Sivananth Ramachandran , CFA, CIPM
Director of Capital Market Policy, India, CFA Institute
Sivananth "Siva" Ramachandran, CFA, is the Director of Capital Markets Policy, India at CFA Institute. In his role, he is responsible for advocating policy positions on issues that impact Indian capital markets, including corporate governance, ESG, and financial reporting, to name a few. Siva was part of a SEBI working group that reviewed the related party transaction regulations. He is frequently quoted in media. Siva has nearly 13 years of experience in financial services. Prior to joining the CFA Institute, he spent five years at Morningstar, and led their global index product development team. He also served as a spokesperson for sustainability at Morningstar India. Prior to his time at Morningstar, Siva spent nearly five years at MSCI where he co-authored research papers on small cap investing, portfolio construction, and economic exposure. Siva has an MBA from the Indian Institute of Management, Lucknow. He also holds the chartered financial analyst (CFA) and professional risk management (PRM) designations, and the fundamentals of sustainability accounting (FSA) credential provided by the Sustainability Accounting Standards Board (SASB).
Sivananth Ramachandran

1 PL Credit

If you are a CFA Institute member don’t forget to record Professional Learning (PL) credit from reading this article.