Markets, Mindsets, and Machines: The Big Takeaways from Morningstar Investor Conference 2025

At the 2025 edition of the Morningstar Investor Conference in Mumbai, India’s top fund managers, technology leaders, and policymakers converged to discuss the evolving contours of investing. The overarching message was clear: the next phase of market growth will be defined by a cyclical earnings revival, disciplined asset allocation, and the intelligent integration of artificial intelligence across investment and advisory practices.

Here’s a look at some of the standout themes and insights that shaped the discussion.

Equity Markets Poised for Normalisation

Experts noted that India’s equity markets are entering a phase of normalisation after nearly 18 months of turbulence marked by election-related uncertainty and global capital rotation.

They pointed out that while India’s GDP growth had dipped to around 5 per cent in FY23-24 and corporate profit growth slowed to just 3 per cent, FY25 could mark a turning point. Earnings growth is expected to rebound to 13-15 per cent this year and possibly 17 per cent next year, supported by policy continuity, improved liquidity, Tax reforms, and sustained domestic consumption.

There was also consensus that while global capital flows currently favour AI-led markets, India’s innovation ecosystem is fast catching up, positioning the country for stronger long-term performance.

All the Risk Now Lies with Investors

Industry leaders candidly acknowledged a significant structural shift in the investment landscape. The risk-bearing responsibility has now moved decisively to investors. With Banks and DFIs becoming increasingly cautious, retail investors have emerged as the key drivers of market risk.

Rising SIP inflows have deepened retail participation, but they have also led to valuation pressures, particularly in mid and Small-Cap segments. Experts cautioned that when flows drive buying irrespective of valuations, concentration risks tend to rise. The message was clear: this is no longer a one-asset-class environment. Diversification through balanced advantage and multi-asset strategies remains crucial, and disciplined asset allocation continues to be investors’ strongest moat.

SIFs: The Next Big Opportunity in Alternatives

Radhika Gupta, CEO of Edelweiss Mutual Fund, introduced the newly created Specialised Investment Fund (SIF) category as a milestone development for investors seeking alternative investment opportunities with the comfort and regulatory oversight of mutual funds.

She explained that SIFs blend flexibility with the trust and tax efficiency of mutual funds and highlighted the focus areas of Edelweiss’s Altiva platform, which include absolute-return products across long-short, private credit, real assets, and equity strategies.

However, Gupta also stressed the importance of investor awareness. Without adequate education and understanding, SIFs could remain limited to institutional investors. With a Rs 10 lakh entry point, they now offer mass affluent investors a gateway to alternatives, but understanding risk remains key to long-term success.

Global Shifts and Investment Discipline

Global investment strategists at the conference underscored the need for investors to adapt to a world that is becoming more fragmented and less predictable. Rising geopolitical tensions, Defence spending, and the reordering of trade relations are reshaping global investment dynamics.

Experts noted that investors must move away from prediction-based strategies and instead focus on resilience, diversification, and probabilistic thinking. The consensus was that in a multipolar world, flexibility and disciplined allocation would define success more than mere forecasting.

RBI’s Vision for One Market, One Price

On the policy front, Dimple Bhandia, Chief General Manager, Financial Markets Regulation Department at the RBI, presented the central bank’s roadmap toward building a unified financial market structure with deeper liquidity and broader participation.

She highlighted the sharp rise in overnight money market volumes from Rs 3 lakh crore to Rs 5.9 lakh crore, the extension of G-Sec maturities to 50 years, and over USD 25 billion in foreign inflows following India’s bond index inclusion. With these structural shifts underway, Bhandia remarked that India’s markets stand at the cusp of a major transformation.

Artificial Intelligence: The New IQ Multiplier

Discussions on artificial intelligence drew significant attention throughout the event. Experts agreed that while AI enhances efficiency, it cannot replace human judgment or emotional intelligence in investing. Markets remain behavioural, driven by human fear and greed, and these elements cannot be automated.

At the same time, India’s rapidly expanding network of global capability centres is giving the country a structural edge in the AI economy. Participants noted that while India may not manufacture every chip, it will power the systems, analytics, and scaled services that enable global AI innovation.

Experts spoke about the idea of ‘having intelligence on tap,’ explaining how artificial intelligence is democratising access to knowledge. Earlier, information and insights were limited to experts or analysts, but AI has made intelligence available to everyone, anytime and anywhere. They traced the evolution of technology from the personal computer to the internet, mobile, cloud, and now AI, highlighting how each phase has been disruptive in its own way. With AI, we have entered an era where intelligence is no longer a scarce resource but a shared utility, empowering every professional to think, decide, and innovate more effectively.

Leaders from the IT and BFSI sectors referred to AI as ‘the new IQ multiplier.’ They explained that the evolution from cloud to cognitive computing is making intelligence accessible to every analyst and advisor. With computing costs dropping dramatically, from USD 10 to under USD 0.10 per million tokens, AI is no longer a futuristic concept but an everyday enabler of insight and efficiency.

The message to financial firms was direct: embrace responsible AI early and experiment intelligently. As one expert put it, “If you haven’t started yet, you’re already late.” The session ended with a powerful reminder that captured the spirit of the conference: in an era of rapid change, the only real mistake is standing still.