Outperformed Sensex more than twice over in Client Portfolios in two years to give 100%+ gains

Indian Equities have been very kind the last two years…and we feel the momentum will sustain into the longer term

Clients are our best ambassadors..Mumbai,Pune,Hyderabad,Bengaluru,Patiala,Sangli,Indore,Jaipur,Jalandhar….USA,Tanzania,Dubai…they are based all over……Small to Big….IT Professionals in Oracle,Cognizant,CapGemini and others,Top CAs, Leading Doctors ,Well Known Businessmen,Employees in leading Industrial Groups and Top Banks,Professionals in Broking Firms too,Real Estate Developers…across the Spectrum

When we first review the Clients Existing Portfolios we often find two basic flaws staring at us

  1. Monies Invested thinly over way too many Holdings
  2. Improper Stock Selections
Clients reveal that they make these selections based on Ideas,often on the Technical Analysis Approach , expressed on Stock Channels on TV and by Broker recommendations  …very rarely do we find them having done even minimal fundamental analysis on such selections….more importantly often the momentum,sentiment and liquidity factors override the all important valuation factor in the assessment

Sometime ago I had conveyed a Testimonial Received from a Retail Client from Sangli with an Equity Portfolio of under Rs 10 lakhs stating he had never made so much money in his life before in Equity in just two years !…he’s on Personal Plan D for Rs 25000 a year and has introduced an other client too in Plan D

Now have a look at how we have performed on a High Networth Couple’s Equity Portfolio...both began under Personal Plan B for Rs 100000 a year and are now on a customised arrangement with minimum Annual fee at Rs 100000 each

They are both highly educated working Professionals in Mumbai  in their late 50’s with the Wife having a Conservative to Moderate Risk Profile and the Husband having a Moderate to Aggressive Risk Profile…one post graduate daughter who is employed

They had a very simple mandate to give us…Protect our Wealth while Growing it

We have done just that  with Fundamental  Stock Selections and no Derivative Play and  no Insider Trading !

The Portfolios have  outperformed the Sensex & Nifty  more than twice over in just over two years from mid September 2012 to end October 3014 to give over 100% absolute gains before Tax and even after our Fees…we have not even considered hefty Tax Exempt Dividends received in the Portfolio!

Amt in Rs Lacs

From Sept, 2012 to Oct, 2014

Wife

Husband

 

Equity Performance

103%

124%

 

Sensex Performance 51 %   Nifty Performance 49%

 

 

Opening Value (14/9/2012)

Closing Value (31/10/2014)

Gains

% Up

Wife

76

154.1

78.1

103

Husband

72

161.6

89.6

124

Total

148

315.7

167.7

113

Sensex Closing

Nifty Closing

 

September 14, 2012

18464

5578

October 31, 2013

21165

6299

October 31, 2014

27866

8322

Performance in 1 year (2012-13)

14.6%

12.9%

Performance in 1 year (2013-14)

31.7%

32.1%

Performance in 2 years

51%

49%

Most of the Gains have been realised and we are now on an asset allocation  rebalancing exercise to protect the wealth made 

Some major reasons that helped us achieve this performance is

  1. Clients unflinching Faith in us and our Fundamental Selections and the timely execution of the advice ,especially agreeing to sell even some big names like Wockhardt,which they were wedded to in their portfolio when they had joined, before it crashed in June 2013 from Rs 2000+ levels to below Rs 1000…in fact way down to below Rs 350 levels in December 2013 before recovering to levels of Rs 750 currently
  2. Good Equity Markets
  3. Concentration of Stocks in Specific Selections at an early stage of their multibagger rise with appropriate exposure and weightage…some of these were NBCC,Firstsource,HOV Services,Tata Sponge,Tata Elxsi,Pennar Ind,VIP,HSIL  & Sterlite Tech

Any Regrets we had in advising on the above?…well yes !..we exited a few earlier and then saw them soar away some more !…but we needed funds to switch to other fundamental ideas and targets had been reached or we thought we could come back later to them …they say once you sell you’ll never re-enter ! …we did not get a chance !…but we did good in other ideas switched to too read more