Start Small, Stay Consistent, Grow Big: An Interview with Bhavan Karmacharya, Head of Investment at Prabhu Capital, on the Launch of PSIS and the Power of SIP

Prabhu Capital is set to launch its first open-ended mutual fund — the Prabhu Systematic Investment Scheme (PSIS) — designed to promote disciplined, long-term investing. The NFO will raise NPR 31 crores, with Prabhu Bank (Fund Sponsor) and Prabhu Capital (Fund Manager) investing NPR 3 crores each, and the remaining NPR 25 crores offered to the public.

With a Systematic Investment Plan (SIP) feature launching soon, PSIS aims to serve both retail and institutional investors, providing a flexible and research-driven investment option. We sat down with Bhavan Karmacharya, Head of Investment at Prabhu Capital, to discuss the fund’s vision, performance, investment philosophy, and why PSIS arrives at the right time for Nepali investors.

Q: Prabhu Capital has just launched its first open-ended mutual fund — the Prabhu Systematic Investment Scheme (PSIS). What inspired this move?

A: This is a big step for us. We’ve spent the last four years managing two close-ended funds — Prabhu Select Fund (PSF) and Prabhu Smart Fund (PRSF) — and both have performed very well, even through tough times. So, we felt it was the right time to offer something more flexible and long-term focused.

PSF, which we launched in May 2021, has delivered around 10.8% CAGR and generated alpha of over 50%, despite operating mostly during the bear market. Likewise, PRSF, which came in March 2023, has also done really well with a 15.5% CAGR and better risk-adjusted returns than the overall market.

Now, with PSIS, we’re giving investors a way to stay invested continuously, and grow steadily — by capitalizing on the discipline and expertise we’ve already demonstrated.

Q: What’s different about PSIS — and why should investors care?

A: PSIS is built around one core idea: consistency beats chaos.

Markets go up and down — that’s just how they work. But most investors struggle not because they pick the wrong stocks, but because they panic, they react, and they try to time the market. That’s where things go wrong.

PSIS helps fix that. It’s a fund designed for systematic investing, encouraging people to invest regularly and stay on track. We’ll also be launching a Systematic Investment Plan (SIP) within a few months. SIPs promote rupee cost averaging — allowing investors to buy more units when prices are low and fewer when prices are high. This approach smooths out volatility and helps build a stable long-term portfolio.

Q: So, this fund is really about behavioral discipline?

A: Absolutely. We believe that investor behavior is often the biggest barrier to long-term success. PSIS is designed to help eliminate emotional decision-making by promoting regular, automated investing.

Instead of trying to “time” the market, which very few people get right, this fund helps you spend time in the market, which is what truly builds wealth. The idea is simple: stick to the plan, trust the process, and let compounding do the rest.

Q: Who is this fund ideal for?

A: Honestly, anyone who wants to grow their money slowly and steadily. It’s brilliant for people and institutions that have regular cash flows and want to invest those cash flows meaningfully over the long-term to reap benefits of compounding.

If you're a young professional just getting started, or someone who’s made a few mistakes trying to time the market, this is a great option. PSIS is for people who want to invest with peace of mind — without checking the market every day.

You can start with a one-time investment now, and once SIP goes live in the next couple of months, switch to making regular contributions to compound wealth faster.

Q: Any final message for investors?

A: Volatility is a significant part of investing — but it doesn’t have to derail you.

With the right mindset, and the right plan, you can make volatility your friend and leverage it to your advantage. That’s what PSIS is here for — to help you stay calm, stay invested, and let your money grow effectively with time by intelligently befriending the market volatility.

You don’t need to be perfect. You just need to make an informed long-term choice and be consistent.

The New Fund Offer (NFO) for PSIS opens from today i.e. on Jestha 23 to Jestha 27, with a possible extension till Asar 6.

For more details:

Email: prabhusip@prabhucapital.com

Phone: 9861989800