Newsletter : January 2026

Start the Year Right: A Simple Financial Health Check for Investors

The beginning of a new year feels like a fresh notebook-clean pages, new possibilities, and a chance to do things better than before. While many of us resolve to eat healthier or exercise more, there's one resolution that often gets overlooked yet has a lasting impact on our lives: checking the health of our finances.

What exactly is being "Ported"?

When you buy a new health policy, you usually have to serve waiting periods (e.g., 2 to 4 years for pre-existing diseases like Diabetes or Thyroid, and 2 years for specific surgeries like Cataract or Stones).

If you have already held a policy for 5 years with Company A, you have "served" these waiting periods. When you port to Company B, Company B agrees to respect that time. They will not ask you to wait another 4 years to cover your Diabetes. This transfer of "time served" is the heart of portability.

When Should You Consider Porting Your Health Insurance?

Portability is useful in certain situations. You may consider porting your policy if:

1. Poor Claim Experience

If your insurance company has:

Delayed claims unreasonably
Partially or fully rejected claims irrationally
Poor customer support then porting to a more service-oriented insurer may be beneficial.

2. Limited Hospital Network

If your insurance company does not have:

Good and large number of network hospitals in your city
Cashless facility in major hospitals you may think of porting to an insurer with a wider or better network of hospitals.

3. Inadequate Coverage

If your current health insurance policy:

Has low sum insured (risk cover amount)
Does not offer modern treatments
Lacks features like room rent flexibility, sublimits on certain treatments, etc; then switching to a better-coverage policy may help.

4. Unreasonable Policy Conditions

Some old health policies have:

Disease-wise sub-limits
Room rent capping
Co-payment clauses Porting can help move to a policy with fewer or no such restrictions.

When You Should NOT Port Your Health Insurance?

Porting is not always the right decision. In many cases, staying with your existing insurer is better.

Why You Should Not Switch for Minor Savings in premium.

In India, we love a good bargain. If Company A charges Rs. 25,000 and Company B charges Rs. 22,000, the natural instinct is to switch to save Rs. 3,000. This can be a dangerous mistake.

The "Teaser" Rate: New insurers may offer low premiums to attract you. Next year or two, they might hike the premium, bringing you back to square one.
Hidden Clauses: That cheaper policy might have "Room Rent Capping" (e.g., they only pay for a semi-private room) or a "Co-pay" (you pay 20% of every bill). Your existing policy might have been paying 100% of the bill.
Issues in Claim Settlement: You might be saving Rs. 3,000 but moving to a company that has more issues in claims than your current one. Is that saving worth the risk during a medical emergency?

Golden Rule: Never port only because the premium is slightly lower. Port only if the value (features + service) is better.

If You Have A Pre-Existing Diseases
If you already have conditions like:

- Heart disease
- Diabetes with complications
- Cancer history
- Kidney issues

In such a scenario, porting can be risky because the new insurer may reject the proposal. Or it may impose permanent co-pay or limits. Resulting in a reduced coverage.

Planning for a medical treatment.

If you are planning: Surgery or a Hospitalization treatment in the coming days / months. Do not port your policy just before or after the treatment. Claims during such transition can become complicated.

Remember - Your old (existing) insurance company cannot deny your renewal, but a new insurer can deny your portability.

Age Above 55 years.

Portability becomes difficult as you age. New insurers are often reluctant to take on senior citizens who might claim soon. If you have a stable policy at age 55, hold onto it tight.

If Your Existing Policy Is Old but Comprehensive

Many old health policies can still work as good as new. There may be fewer exclusions, no sub-limits or deductions. If there are no major issues with the old policy, it should be retained.

Important Things to Keep in Mind While Porting

1. Port request should be given well in advance
Portability request must be made: At least 45 days before policy renewal. Not a few days before renewal due date. Missing this window can lead to rejection or a gap in insurance coverage.

2. Disclose All Health Information Honestly
Always disclose: All past & existing illnesses completely and correctly. Inform about past surgeries. Also provide information on current medications and lifestyle habits like alcohol / tobacco, etc; Hiding any such information can lead to a claim rejection or policy cancellation later.

3. Porting Is Not Automatic
Porting is subject to approval by the new insurer. They may accept or accept with conditions or reject.

4. Check the Sum Insured
If you have a Rs. 3 Lakh policy (including cumulative bonus) and porting to a Rs. 5 Lakh policy, the "Portability Benefits" (no waiting period) apply only to the first Rs. 3 Lakh. For the extra Rs. 2 Lakh, you still have to serve a waiting period.

5. Check the First Policy Inception Date
After the porting process is completed and you receive the new policy document, it is important to check the first policy inception date. This date should be the same as your old (previous) policy's inception date. If it matches, everything is correct.

For example, if you bought a health insurance policy in 2022 and ported it to a new insurer in 2025, the first policy inception date on the new policy should still be 2022, not 2025.

Why Should You Always Consult Your Insurance Advisor?

A qualified insurance advisor: Understands policy benefits and its working, knows claim settlement records, evaluates long-term suitability and not just premium.

An experienced Insurance Advisor acts as your safety net. They can:

Decode the Policy: Tell you exactly what you are losing by leaving your old insurer.
Assess Your Risk: Tell you, "Sir/Ma'am, with your medical history, Company B will likely reject you. Let's try Company C or stay in the existing company."
Handle the Paperwork: Portability requires strict coordination between the two insurance companies. An advisor chases them so you don't have to.

Never take a porting decision in haste or based on advertisements alone.

Final Thoughts

Health insurance Portability is a powerful right given to you. It stops insurance companies from taking you for granted. However, it is a tool that must be used with caution. It is not meant for switching unnecessarily or unreasonably.

You should port your health policy: Only when there is a genuine service or coverage issue. After understanding all the advantages, limits & conditions and after consulting your insurance advisor.

You should not port: Just because of a minor premium difference. Remember, health insurance is not about saving a few thousand rupees today-it is about protecting lakhs of rupees tomorrow.

Take informed decisions, stay insured wisely, and always prioritize coverage & service over price.

Break the Trap of Recency Bias: Embrace Quality Investing Now

Introduction
Think about a cricket team having a few bad matches; everyone starts doubting them, forgetting all the years they played brilliantly. Investors tend to behave similarly. When a factor dips briefly, the recent fall feels bigger and scarier than everything that it has delivered over the long term.

What Is Recency Bias in Investing?

Recency bias is a common behavioural bias where investors give more weight to recent events and ignore long-term historical data and fundamentals. Recent volatility, short-term returns, or new headlines feel louder and more convincing than years of consistent performance.

Psychology explains why:

The brain prioritises vivid, recent, and emotionally charged information.
Usually, short-term price movement triggers fear or excitement far stronger than long-term facts.
Investors assume recent performance will repeat, even if it contradicts fundamentals.

Considering all this, the result is that investors tend to chase what is working now and ignore long-term fundamentals.

How Recency Bias Makes Investors Miss Investing in Quality

1. Short-Term Dips Appear Bigger Than They Really Are

Every high-quality company goes through phases where stock prices are either stagnant or corrected. But recency bias makes these normal fluctuations look like a major warning sign. Investors hesitate, even though nothing has changed in the fundamentals. This is the most common cost of recency bias.

Example: Rohan saw his favourite quality stock fall for a few weeks and stopped investing in that high-quality stock. Later, the stock had recovered over the next few months, and Rohan ended up repurchasing it at a higher price.

2. Recent News Hides Years of Strong Fundamentals

Headlines and short-term noise often overshadow what truly matters:

Consistent profitability
Strong balance sheets,
Prudent capital allocation,
Strong governance,
Stable earnings growth.
Lower Leverage
High dividend payout

Recency bias shifts its attention from fundamentals to recent reactions.

Example: Meera read a negative article about a temporary sector slowdown and avoided a company she had trusted for years, which had strong fundamentals. After a few months, the slowdown reversed, the company posted strong results, and the stock rallied, but Meera missed the entry due to that one negative article.

3. Investors Start Chasing What's Trending Instead

A stock that has rallied recently "feels" more attractive, even if it is overpriced, than one that is temporarily flat and underpriced. This makes investors overpay for short-term winners while ignoring high-quality companies available at good valuations.

Example: Arjun sold a fundamentally strong company and bought a "hot trending" stock that everyone was talking about online, but later the trending stock lost momentum, corrected sharply, and Arjun realised he had left a stable compounder for a short-lived trend.

4. Long-Term Resilience Gets Overlooked

Quality investing shows its strength across cycles:

Lower drawdowns in volatile and choppy markets,
Faster recoveries,
Smoother compounding over time.

But recency bias hides these long-term advantages because investors focus only on what happened recently, not on how the business performs through cycles.

Example: Kavya exited a quality fund after a dull quarter, thinking it had "lost steam". And later, the fund bounced back, outperformed the market for the next few years, and she re-entered much later at higher NAVs.

Historical Evidence: Why Quality Shines Over Longer Horizons

Recency bias often makes quality investing appear "unimpressive" in the short term. But historical market patterns consistently show that quality-oriented portfolios tend to deliver smoother returns and better downside protection over longer durations.

Calendar Year	NJ Traditional Value	NJ Quality+	NJ Momentum	NJ Low Volatility	NIFTY 500 TRI
2016	16.88	7.46	0.22	10.53	4.68
2017	48.22	42.24	69.43	36.43	37.65
2018	-19.97	-2.32	-7.92	0.27	-1.55
2019	-13.33	2.92	9.16	2.17	8.64
2020	14.80	24.85	37.75	17.84	17.70
2021	53.67	49.62	55.99	31.65	30.95
2022	10.70	4.51	6.75	3.60	4.25
2023	56.57	56.67	47.78	38.59	26.91
2024	27.20	28.18	32.17	21.47	16.00
2025 YTD	4.11	-1.71	-3.00	6.53	6.46
Outperformance Count	6/10	7/10	7/10	7/10	-

Source: Internal Research and NJ AMC's Proprietary SmartBeta Research Platform. For 2025 YTD, Data is till 31st October, 2025. NJ Traditional Value Model, NJ Enhanced Value Model, NJ Quality+ Model, NJ Momentum+ Model, NJ Low Volatility+ Model and NJ Multi-Factor+ Model are proprietary methodologies developed by NJ Asset Management Private Limited. The methodologies will keep evolving with new insight based on the ongoing research and will be updated accordingly from time to time. Past performance may or may not be sustained in future and is not an indication of future return.

CAGR Comparison: NJ Factor Model vs Nifty 500 TRI

Source: Internal research, Bloomberg, CMIE, National Stock Exchange. Calculations are for the period 30th September 2006 to 31st October 2025. NJ Traditional Value Model, NJ Enhanced Value Model, NJ Quality+ Model, NJ Momentum+ Model, and NJ Low Volatility+ Model are proprietary methodologies developed by NJ Asset Management Private Limited. The methodologies will keep evolving with new insight based on the ongoing research and will be updated accordingly from time to time. Past performance may or may not be sustained in future and is not an indication of future return.

A look at the recent performance of the quality factor shows that the quality factor faced headwinds, which can trigger recency bias in investors. But still, even after the headwinds, NJ Quality+ Model (20.21% CAGR) has outperformed Nifty 500 TRI (14.90% CAGR) in 7 out of 10 calendar years, which is similar to or more than any other factor. If investors only look at the recent performance, they might be lured away by the quality factor and invest in other factors.

But looking at the longer picture, quality has been one of the best and consistent performer. Quality rarely explodes; it simply persists. It doesn't win every phase of the cycle; it wins across cycles. For the period from September 30, 2006, to October 31, 2025 quality CAGR of 19.24% significantly outperforming the overall benchmark, the Nifty 500 TRI, which posted a CAGR of 12.73% over the same period.

If a slow or muted patch is making investors wonder whether to return to quality, that's recency bias talking because the real mistake was actually stepping aside when it looked boring.

Conclusion

Recency bias may feel harmless, but it causes investors to stay away from strong, reliable companies simply because recent performance looks dull. By shifting focus from short-term movements to long-term fundamentals, investors can stay aligned with the patterns that truly matter and avoid missing opportunities hidden behind short-lived trends.

The key is to focus on fundamentals, stay consistent, and have long-term investing discipline. Explore NJ Mutual Fund's 100% rule-based investment approach designed to help you stay bias-free, consistent, and quality-driven through every market phase.

FAQs

1) Why does recency bias influence investment decisions?
Because recent events feel more vivid and emotionally convincing than older data.

2) Are high-quality stocks always consistent?
Not in the short term. Their real strength appears over longer horizons and market cycles.

3) How can investors avoid recency bias?
Recency bias can be avoided by looking at multi-year performance, following rule-based strategies, and avoiding emotional decisions driven by short-term headlines or movements.

Investors are requested to take advice from their financial/ tax advisor before making an investment decision.

MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.

Fund Manager Interview

Mr. Alok Singh

Chief Investment Officer - Equity, Bank of India Mutual Fund.

Mr. Alok Singh is a Postgraduate in Business Administration from ICFAI Business School and a CFA with over 24 years of experience in Fund Management. He has a wealth of experience and impressive track record in fund management both for residents as well as for overseas investors. In the past, Alok has won numerous awards for stellar fund performance during his career span. Alok heads the overall Equity & Fixed Income Investment Operations for Bank of India Investment Managers as Chief Investment Officer. Alok's remarkable achievement includes growing the company's Assets Under Management from Rs. 100 crore to approximately Rs. 12,000 since his joining in April 2012.

Please note we have published the answers as it is received from the Fund Manager of Bank of India Mutual Fund.

Q : Q2 earnings were strong with double-digit profit growth and improving sales momentum. How do you anticipate this trend evolving over the next few quarters, especially in terms of demand visibility and margin trajectory?

Answer : Q2 FY26 earnings clearly suggest that the downgrade cycle that weighed on markets for the past year appears to be nearing its end. After cumulative cuts of nearly 8–10% over the last four quarters, consensus downgrades have moderated to a large extend in recent updates, signaling improved stability and a potential shift toward earnings normalization. Importantly, consumption demand appears to have remained resilient beyond the festive season, suggesting that the momentum could carry into the fourth quarter as well.

Q : The IPO market has seen strong demand and oversubscriptions across categories. Do you believe the current IPO momentum is driven by fundamentals or excess liquidity? Are valuations in the primary market getting stretched?

Answer : We hold a mixed view on the ongoing IPO season. While not all offerings appear stretched in terms of valuation, a few represent genuinely good and unique businesses, with some issuers seeking growth capital to scale further. However, in several cases, valuations are not compelling, the businesses lack a clear competitive moat, and a significant portion of the proceeds is being raised through Offer for Sale rather than fresh capital infusion.

Q : The US AI rally has surged while India has stayed on the sidelines. Does India have the ecosystem to participate meaningfully, and should investors view its limited participation as a risk or as protection from overheated valuations?

Answer : Artificial Intelligence represents one of the most significant innovations of our time. In the initial stages of any breakthrough, its propagation and usage are largely controlled by the original innovators, and India has not been part of that early innovator club. However, as the technology matures and stabilizes, India is well-positioned to emerge at the forefront. The country's digital ecosystem is evolving rapidly, with several platforms and infrastructure elements already among the best in the world. We believe this creates a strong foundation for AI adoption and integration across industries in India, ensuring that investors will not be disappointed in the long run.

Q : Do you follow a growth, value, or blend-oriented investing style, and what specific factors or signals determine which style you lean toward at any point in time?

Answer : We follow a blend-oriented investment style that combines elements of both growth and value strategies, with a strong emphasis on businesses delivering sustainable Return on Equity (ROE) over the medium term. Our approach is dynamic and guided by the prevailing level of economic activity-robust, broad-based growth typically favors a growth tilt, while periods of moderation call for a more value-conscious stance. In addition to ROE, we evaluate factors such as balance sheet strength, cash flow visibility, and industry positioning to ensure resilience across market cycles.

Q : With the rapid evolution of smart-beta products and increased use of quantitative screening in portfolio construction, how is your AMC integrating these tools into its investment process? Do you see quant-driven frameworks becoming more relevant for alpha generation, or will they remain complementary to traditional fundamental research?

Answer : Data analytics capabilities and the quality of available data are undoubtedly improving, which will enable us to incorporate more model-driven approaches into our investment process. However, we believe these tools should remain complementary to fundamental research. India is a fast-growing economy where businesses are undergoing significant structural changes, and these shifts continuously influence investor understanding and expectations. Given this dynamic environment, we expect that a human edge-deep qualitative insights and judgment-will continue to be essential for generating alpha in the foreseeable future.

Q : Many investors focus heavily on short-term returns before choosing a mutual fund. From your perspective, what are the right long-term metrics or framework investors should evaluate to judge whether a scheme is suitable for them?

Answer : Each portfolio, based on its construct and exposure, may exhibit short-term trends that are often unsustainable over the long run due to market dislocations or temporary factors. Therefore, investors should place greater emphasis on consistency of performance over extended periods rather than being swayed by near-term fluctuations. Scheme selection should be done after considering the long-term risk-adjusted returns of portfolio and its alignment with the investor's financial needs..

Note: Views provided above are based on information in the public domain and subject to change. Investors are requested to consult their mutual fund distributor for any investment decisions.

MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY

Ramdas Bhat (ARN-82171)
AMFI REGISTERED MUTUAL FUND DISTRIBUTOR

RAMDAS BHAT

9322216272

8779204203

reachingout.21@gmail.com

www.ramdasbhat.com

# 261, SATRA Plaza. Palm Beach Road Vashi, Navi Mumbai-400 703. Maharashtra

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Disclaimer

"We have taken due care and caution in compilation of this E Newsletter. The information has been obtained from various reliable sources. However it does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions of the results obtained from the use of such information. Investors should seek proper financial advise regarding the appropriateness of investing in any of the schemes stated, discussed or recommended in this newsletter and should realise that the statements regarding future prospects December or December not realise. Mutual fund investments are subject to market risks. Please read the offer document carefully before investing. Past performance is for indicative purpose only and is not necessarily a guide to the future performance."

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Investment in	Bank FD	MF - Hybrid Scheme
Interest/Returns	6.05%	9.62%
Monthly Withdrawal (Rs)	50417	50417
Period (Years)	15	15
Total Withdrawal (Rs)	9075060	9075060
Value at the End of the corpus (Rs)	10000000	20352948