@visuarchie , Hi Vishwanath ji, just curious, your remaining 90% equity is into what strategy??
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@Mudit.Kushalvardhan I have been investing for more than 20 years now. Previously, it was never following any system. It was random buys. Therefore, most of it is legacy buys.
Right now, it is systematic and more focussed.
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Hi I am a new investor and learning. can you please elaborate more on your strategy? also, share the updated file every fortnight which will help me. gautamashukla@yahoo.com
What a nice response!
Dear Viswanath,
First, thank you so much for replying in such details. I realize that my questions werenât precise. I meant to ask you the percentage construct of your portfolio and you have explained it very clear - equi-weighted.
Again, thank you for sharing and your prompt response to my queries.
All the best for your investments.
James
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@gautamashukla There are two videos that I had posted previously. You can find them around the 250th message in a thread called âSmallcap Momentum Portfolioâ. That will explain the strategy and how the sheet is used.
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@visuarchie There are quite a lot of people interested in the weekly rebalance. Please share the Excel sheet here like in small and microcap thread. Thanks a lot for the time you put to educate us this momentum strategy.
@Sudhakar_Subramanian I do a fortnightly rebalance of the Midcap pf. I will post my updates on 1st and 16th of every month.
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@visuarchie - how is the last 10 days or so with this portfolio? seen a huge down moves as most of the stock which were running high for last one year are the ones beaten badly in this fall?
@rami2k This midcap pf has not been hit too badly. If I look at the NAVs between end of last week and end of this week, the pf is down by just 4.87%, which I think is perfectly fine.
From the time I did my last rebalance on 16th, the pf is down by 9.5%.
@visuarchie Thank you for sharing this strategy. As far as I understand, momentum portfolio works great during bull run and can be a disaster during bearish market. What is your strategy on risk management in this case?
Also, from where can we get the price of a stock date wise?
TIA
@suroy2387 In momentum of the type we follow, we do not have a specific exit strategy. We rank the stocks and based on the ranking stocks enter and exit.
There are some people who shift to cash or gold when the market turns bearish.
We get the daily data from Google Finance. There is a video around the 250th message in a thread called âSmallcap momentum portfolioâ. Check it out; you will have details on how to proceed with pf formation.
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Update for entry on 4th November 2024
Based on ranking:
- DIXON
- KALYANKJIL
- POWERINDIA
- OFSS
- FORTIS
- LUPIN
- PERSISTENT
- SUZLON
- RVNL
- POLICYBZR
- COROMANDEL
- AJANTPHARM
- BSE
- IREDA
- TORNTPOWER
Based on Aâ> Z for easy tracking:
- AJANTPHARM
- BSE
- COROMANDEL*
- DIXON
- FORTIS
- IREDA
- KALYANKJIL
- LUPIN
- OFSS
- PERSISTENT
- POLICYBZR*
- POWERINDIA
- RVNL
- SUZLON
- TORNTPOWER*
Exits:
CGPOWER, PRESTIGE and VOLTAS make an exit.
Entries:
COROMANDEL, POLICYBZR and TORNTPOWER make an entry.
Note: The above information is provided for educational purposes only. Please consult your Financial advisor before any investment.
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Update for entry on 18th November 2024
Based on ranking:
- DIXON
- OFSS
- COFORGE
- PERSISTENT
- FORTIS
- KALYANKJIL
- VOLTAS
- POLICYBZR
- COROMANDEL
- INDHOTEL
- LUPIN
- RVNL
- POWERINDIA
- IREDA
- BSE
Based on A â Z for easy tracking:
- BSE
- COFORGE*
- COROMANDEL
- DIXON
- FORTIS
- INDHOTEL*
- IREDA
- KALYANKJIL
- LUPIN
- OFSS
- PERSISTENT
- POLICYBZR
- POWERINDIA
- RVNL
- VOLTAS*
Exits:
AJANTPHARM, SUZLON and TORNTPOWER.
Entries:
COFORGE, INDHOTEL and VOLTAS
Note: The above information is provided for educational purposes only. Please consult your Financial advisor before any investment.
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thanks @visuarchie.
May I request you to add a short one line comment on why a stock is exited or entered. this will help us to understand the process better. If possible, kindly incorporate. Thanks!
@rami2k âŚits pure mathematicsâŚthe momentum is calculated based on price action of 6 month & 12 months.
Everyweek it is recalculatedâŚwhich ever runs more, stays in listâŚanything which isnt running in the timeframe, gets a chop !
Momentum means math âŚMath is the rationale.
Trying to help vishwanath Bro at replyâŚhope i described it right ! 
âŚyes ?
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@LarryWink I could not have said it better. Thanks.
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This gave me confidence to start.
I have been contemplating to start something or exactly this after having read so many papers and blogs by jegadeesh titman and capitalmind and what not.
I wonder how i missed this or the smallcap (which has gone above 700 now, thats why chose to comment here)
Sir, you are outstanding. And I couldnât have come across with this thread at any better time.
I am done with my python code too.
Have considered few things- how many up days in last 6 months as percent of total, returns of 1-3-6 months. Should i add 12 months too?, and 20% from the 52W high.
20 stock portfolio. Is the stock above 50 ema (must be right?!)
Universe selected 750 (should i do with 500 only?)
Monthly rebalance on last friday of the month.
Exit criteria- exit if it goes below 25 rank.
Buy if 50 ema is above 200 ema.
Rank all and then see which has piotroski score 4 and above.
Anything you want to add or think I should change?
About me-
Started as investor for first 4-5 years. Then tried trading-swing positional only for 2-3 years. Subscribed to 2 momentum smallcases- paid.
Been reading Jegadeesh and Titman paper for 2-3 years now -first came across in October 2021. First python code created in 2022 May. And never got ahead with it. And now when code is done with above logic came across these two wonderful confidence booster thread.
Thanks a ton bro. Thanks a lot.
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@alphaAKS Good to see that you are going to start with building a portfolio. Jagadesh and Titman used what is known as 12-1 in their momentum ranking. What we use is slightly different.
Some suggestions from my side:
- Typically, you should choose top 10% of the universe as your portfolio size. So, if the universe if Nifty 750, having a pf of just 25 stocks may be too small. I have 5 different pfs to cover N750.
- If you want to build a pf of pure momentum, look at just price action, ie. Rate of Change. Adding more metrics to it, will lead to a reduction of returns (but will also lead to a reduction in drawdowns). In our case we have added a volatility factor only.
- If your universe if N750, there will be a large proportion of smallcap and microcap stocks in the pf. Monthly rebalance could be tricky as these stocks are known to fluctuate a lot.
- If you just want to get a feel of how the strategy performs, you could choose microcap 250 as the universe and build a pf around that with a weekly rebalance. This universe has been very rewarding for me. This is also listed in this forum.
In summary:
Choose a smaller universe or increase the number of stocks in pf.
Reduce the number of indicators used for ranking stocks.
Choose appropriate rebalance interval.
Follow the system completely; do not apply personal bias in any decision.
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@visuarchie Sir,
I was thinking how our momentum strategy differs from momentum based small cases ( weekend / wright ). Do you have any experience with momentum small cases ?
Thanks
@nil I have subscribed to 2 of Weekendâs small cases. In fact, my momentum journey started with these only. It sparked interest and I learnt and implemented.
I think he goes by price action only. As they donât publicise their formulae, it is difficult to find out.
Typically, I have seen there are about 2 or 3 stocks that are different between our pf and Weekend for a similar universe. Further, I find that sometimes, we enter a week earlier or he enters a week later. So, the stocks are more or less the same.
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