Nithin’s Portfolio

@manoopatil : We are all learning and part of learning. I always like to test and try all structures that works the best.

What works for me – may not work for you.

These are my learning

FOMO : Every individual has it – sometimes we even wonder

• Is my Portfolio on the right track to growth?
• Why isn’t my portfolio going anywhere while my watchlist are having party
• What happens if the company cannot execute and i missed the bus?
• What should i do during times of uncertainty?
• What if i selected the wrong sector and believed it to be the holy grain?

In order to deal the FOMO I have a sectoral portfolio to play the cycles and learn from it.

• This give me mental stability to learn new things, understand market better and grow.

On contrary I have my CORE PF which is long term to support if something goes wrong

Am alone and I don’t have a research team – I work during weekdays and only during weekend I get some time to see the market

Mr Market is superior and super efficient in terms of how to re-rate and how to punish – If you are on the wrong side of the shore then you will learn your lesson but in BULL Market the tides will push all things.

CORE PF

Firstly : Ideas are something that you cannot get it from thin air – you need a team or someone to help you out with it.

I sense ideas from News, People whom I follow, YouTube, forum, twitter etc.

First : Once you have ideas based on sectors : I See what are the constituents of that sector and industry growth size for these sectors

In my example it’s pharma because these sectors have not gone anywhere since past 5+ years
IT has done phenomenal well and I don’t like them except for the SAAS companies who have edge over their product example Emudhra, Rate Gain, Newgen

Second : Check for stocks relevant to these sectors with the purpose of differentiation, disruption, moat, cost advantage, leadership etc. for me its

• Pharma : contract manufacturing, new generation molecule, low cost manufacture with process innovation and green chemistry, PLI beneficiary, only maker in India, most of the pharma are entering into agri, animal, nutraceutical , biotechnology these are also one has to lookout.
• IT : SAAS
• Defense : Drone / Anti Drone, Radars, Sonars.
• Railway : Wagons, Suspension, Breaks, Anti collision
• Auto : Graphic designing, auto ancillary, digital meter, led, solar roof, suspension
• Chemicals/Specialty chemicals : Mainly Fluorine chemistry, Aromatics much more

Note : when I pick advantage among these – I choose stock that fits the relevance example : suspension no matter what changes either its EV/HYDROGEN/CBG/CNG or whatever suspension is MUST.

Third : I see who are the competitors & valuation : if my company is having growth
which is at reasonable valuation – I pick them, I don’t wait for leaders

Fourth Invest and track them for long, for some stocks here like PRAJ, SBCL, LAURUS (Exited) – I have waited for 3 years.

I don’t know all these can go right or wrong but least thing is that there are no disruption for time being, each has own advantages

SECTORAL PF

Here is what I do :

First Understand from the experts about MACRO & MICRO situations example : Alpha Moguls: Kenneth Andrade’s Mantra For Alpha Creation | BQ Prime – YouTube

I follow Kenneth Andrade and hear his commentary every time – that gives me sense of what’s moving and what’s not.

Second I list them down :As per the interview for any economy to move there should be a domestic growth market + export growth market (service sector)

• He also mentioned that commodity is the base for everything and he would place bets on commodities where the price is attractive but you need to be careful about cycles and exit strategy is the must
• He did talk about B2C and he told due to inflation he would refrain B2C companies but B2B, B2G looks very good.
• He mentioned Pharma also
• Lastly he did talk about industrial goods/capital good and told the valuation is expensive.

Third :

• Go through the Forum, YouTube, Twitter and collect ideas based on the above framework there is no shame here if you are trying to learn something from someone – learning from others helps in cutting your bias & ego – the only shame is when you don’t do anything.
• Get to know about the company, business and growth – what I see here is the growth guidance from the company, any Capex, Export, Market share, Disruption, Niche/MOAT, specialty, Gross Profit> 40% or Margins > 20% that they can achieve
• Listen to the concall either daily, or weekend and make notes about headwinds, tailwinds, triggers etc.

Fourth

• I use the screener, forum, chartlink to find out 52 week breakout/stage 2 analysis
• Get to know about the company, business and near term triggers
• Add them to satellite PF during near triggers
• And if my SECTORAL stocks do well i shift them to my CORE PF

That’s all I do

Read book by the name of CAPITAL RETURNS by Edward Chancellor