Posts in category Value Pickr
Prime Fresh Limited – Organized Player In F&V Industry (01-07-2024)
Any negative news on stock . stock has fallen almost 40% from peak .
FIEM industries : auto ancillary player (01-07-2024)
(post deleted by author)
Atma Nirbhar Bharat – Stock opportunities (01-07-2024)
Market cap.perhaps can always increase and decrease depending upon how the market values which may again depends upon the quarterly performance. And at times market may behave irrationally which later can get corrected in due course.
As far as order book is concerned , Mazgaon dock hss the highest order book
Atma Nirbhar Bharat – Stock opportunities (01-07-2024)
GRSE has a massive order book when compared to its market cap. does that help add any more weightage to the stock?
Atma Nirbhar Bharat – Stock opportunities (01-07-2024)
In fact I was trying to add to my existing holdings .
But I am holding back my decision due to the recent run up!
However , i am not qualified to give you a recommendation though I remain invested since last 2-3 years.
But I don’t find any specific reason why the stock is running up so fast … there is no uniqueness with garden reach among other peers l… All 3 stocks are equally placed to take benefit of defence play in shipping.
it may be possible that many funds / FII/ institutions/ HNI chasing or there is something in the market which we are not aware.
Rather , given a choice , i would like to add Mazgaon dock available at much cheaper valuation currently available and it may not be possible to add during OFS or post OFS as the stock may skyrocket merely because of wide valuation gap between it and it’s other two peers.
Discl : I am not a Sebi registered equity analyst. This is my personal view. Not a buy sell recommendation. please do your own assessment before buying. I may be biased since I have investments.
Microcap momentum portfolio (01-07-2024)
@Mohana_kri Hello, thanks for your comments. Please find below answers to your questions.
- Please clarify when you say the results are different. Is the selection itself very different or the order?
2a. This is something that I have observed. This has a lot to do with the stock weights in the index. It is possible that the stocks we are holding may move a lot, but has a lower weightage in the index. This can cause differences between the two. I have been enquiring and asking several people about this. One of the suggestions was to compare the NAV of any MF running on this index and the NAV of this pf. I am working on this and I have been computing the NAV of these pfs on a daily basis.
2b. I have not seen any correlation like this, but I believe it is more related to 2a.
2c. Again, no such correlation as long as the comparison is with Microcap 250 index. Same explanation as 2a.
2d. Yes, we do not take any action mid week.
- If you are referring to UTI Momentum pf, then the answer is yes. I have tried to understand their methodology and derived my own worksheet.
AGI Greenpac- on the cusp of growth? (01-07-2024)
Arihant Capital analysis of the HNG acquisition and buy recommendation issued.
DIY Momentum QnA and Discussion (01-07-2024)
What is good rebalance frequency 7,15,30, 90 days?
The rebalance frequency plays a major role in RAR (Risk adjusted Returns), the above mentioned frquencies hav their own pro and cons kind go throgh the same:
Choosing the optimal rebalancing frequency for a momentum portfolio depends on balancing transaction costs, capturing momentum, and managing risk. Here’s a comparison of different rebalancing frequencies based on various studies and practical considerations:
7 Days (Weekly)
Pros:
- Captures Short-Term Trends: Quickly adapts to changes in stock performance, capturing short-term gains.
- Reduces Drawdowns: Minimizes the impact of losing positions by frequently exiting underperforming stocks.
Cons:
- High Transaction Costs: Frequent trades increase costs, which can erode returns.
- Tax Implications: More frequent trading may lead to higher short-term capital gains taxes.
- Increased Volatility: High turnover might increase portfolio volatility.
15 Days (Bi-Weekly)
Pros:
- Balance of Responsiveness: Provides a middle ground between capturing short-term trends and managing transaction costs.
- Reduced Volatility: Slightly lower turnover compared to weekly rebalancing, potentially reducing volatility.
Cons:
- Still High Costs: Transaction costs and tax implications are still relatively high.
30 Days (Monthly)
Pros:
- Optimal Balance: Many studies suggest that monthly rebalancing captures momentum effectively while managing costs. Jegadeesh and Titman (1993) found monthly rebalancing to be effective for momentum strategies (Smallcase).
- Lower Transaction Costs: Compared to weekly or bi-weekly, it significantly reduces transaction costs and tax implications.
- Practical for Individual Investors: Easier to manage and less time-consuming.
Cons:
- May Miss Short-Term Trends: Less responsive to very short-term market changes compared to weekly rebalancing.
90 Days (Quarterly)
Pros:
- Low Transaction Costs: Minimizes transaction costs and tax implications.
- Less Time-Consuming: Easier to manage with fewer trades.
Cons:
- Delayed Response: Slower to respond to market changes, potentially missing short-term momentum shifts.
Empirical Evidence and Practical Recommendations
- Jegadeesh and Titman (1993): Found that holding periods of 3 to 12 months produced significant abnormal returns for momentum strategies (Smallcase).
- Asness, Moskowitz, and Pedersen (2013): Showed that momentum strategies generally perform well, but net returns after transaction costs can vary based on rebalancing frequency (smallcase).
- Lesmond, Schill, and Zhou (2004): Highlighted the impact of transaction costs on high-frequency trading strategies (Smallcase).
Conclusion
For most individual investors, a 30-day (monthly) rebalancing frequency is generally optimal. It balances the need for timely adjustments with manageable transaction costs and practical implementation. However, if you are dealing with a highly volatile market or have very low transaction costs, you might experiment with shorter frequencies like 7 or 15 days. Conversely, if minimizing costs is a priority and you can tolerate some lag in responsiveness, 90 days could be suitable. Ultimately, backtesting your strategy with different frequencies can help determine the best fit for your specific goals and market conditions.
Sanghvi Movers (01-07-2024)
Sanghvi mover’s Capex is to acquire/purchase Cranes.