How to BEAT THE INDEX by 10% Annually over 45 Years | Trending Value Strategy on Indian Stocks

[@bhaveshpatel498]

Thanks for knowledge share and backed by data and research

[@shankarnath]

Thank you very much, Bhavesh for this wonderful gratuity and for your appreciation, I am happy you are liking my work. Please do subscribe to my newsletter at shankarnath.substack.com aswell where I look at specific opportunities in the stock market (the recent issue had a 18% profit opportunity via the TCS buyback). I'm starting with a once-a-fortnight newsletter and over time, this becomes a weekly one.

[@sirajuthanganakath2605]

@@shankarnathit shows page not found. Pls check.

[@shankarnath]

Pls try again. shankarnath.substack.com

[@bhaveshpatel498]

@@shankarnath Subscribed to Newsletter. Your analysis and content is as good as Harsha Bhogle to Cricket if not better. One advice please, what paid screener is good to get ratios , vwap , charts etc ? I understand this is not financial advice 😃

[@shankarnath]

@@bhaveshpatel498 Thank you very much. I can never replicate Harsha's immortal words "Are we onto something here? .. but I'll try :) I don't use paid screeners for now but I'll certainly subscribe to one or two soon enough. Screener.in is something I use & see a lot of value in. Another one that Ishmohit (SOIC) recommended when I last met him is Tijori.

[@sivakumarvenkata8073]

For the benefit of viewers - the top 25 stocks pointed out by Shankar in this video gave a return of 2.3X as of Sep 7th 2024. This return assumes one had bought all the 25 stocks in equal numbers on Nov 23rd 2023. Total unit value of all 25 stocks as of Nov 23 rd was 34,570 vs 79,109 on Sep 7th 2024. Great work Shankar.

[@shankarnath]

Thank you 🙌

[@pavanramappa7464]

@shankarnath how is this portfolio looking now pls?

[@anurag5851]

how is the portfolio doing?

[@swarnadityamaitra6257]

I can't believe how late I found this channel. Honestly, one of the best channels out there. No hyperbolic thumbnails or rhetorical commentary, just pure and simple data-backed analysis. Thank you for doing this!

[@shankarnath]

Welcome aboard!

[@charanjeetsingh1100]

You are trending man! The credit goes to your study and passion. Hats off.

[@shankarnath]

Thank you Charanjeet 🙌

[@sridharkalyanaraman6943]

Define SHANKAR NATH in one word ? The answer is: AWESOME - the very very best in FINANCE - yet another impressive video - what makes him the best is his ability to be simple, articulate and a no-frills way of presentation - Thanks yet again!

[@mohan7642]

Agree 👍

[@shankarnath]

Thank you so much for the kind words, Sridhar ji. It's great to receive support and encouragement - that's the fuel for content creators to do better in their chosen profession. I paused a bit, when I wrote "profession" :) .. could have been working in my office now earning a few lakhs a months, but here I am .. earning too little, working too much and "professing" to Indians allover about investing :) .. life's turning tales, I guess. Thx again!

[@sridharkalyanaraman6943]

@@shankarnath Not sure what to say reading your response - discovered you during your time at ET Channel and followed you as you created your own channel - your passion in creating content and educating Indians on finance and investing - HUGE RESPECT SIR 🙏

[@kumarkisalay3866]

Sir, I Have made 58% return(profit- Rs. 1.7 lakh)in 1 year by making 1 Small case inspired by your Video " Peter Lynch 3 times in 3 years". I admire you.

[@anirbanadgiri99]

Can you please share the video

[@kumarkisalay3866]

Search " RePeter lynch Shankar nath" it will come. It was broadcasted 11 month ago

[@shankarnath]

Thank you very much. I'm glad it was helpful. Please read/watch videos on multiple strategies and customize your approach. In the months and years of researching and making these videos, I've discovered there is no single silver bullet and different strategies work better in specific situations. The videos on my channel has covered momentum, growth, value, deep value, cash-rich, microcaps, factors and more .. please absorb as much as you can and remember, since everyone can make mistakes incl. me .. always Trust But Verify. Wishing you the best!

[@kumarkisalay3866]

@@shankarnath yes Sir, I am learning as much as possible by reading, video, Economic Times, Twitter etc.

[@apsabhiraaj]

I have also made 88% in ndr auto buying price was 814 but company annouced bonus 1:1 i got 10 shares and their value was adjusted 407 now making 88% profit

[@GopalMusale-sw7xf]

Shankar you are the best KZbin presenter related to stocks in India. Very rich and knowledgeable topics. Keep it up

[@shankarnath]

So nice of you. Thanks a ton, Gopal ji

[@lordrdx666]

Thanks a lot Shankar Sir for such informative, data driven, content rich videos. Chole BHATURE par bhi video karna hai hamey!! ❤ Please keep the content coming. A Video on ELSS funds will be very useful.

[@shankarnath]

So nice of you, Ravi. Yes, chole bhature is still pending but unfortunately I have too much on my plate (metaphorically speaking) :)

[@nishaanthshanmughasundaram2558]

@shankar: Please keep the same level of research and passion going forward. I sincerely hope you reach the top of the fin educators in India. I would never understand people like Akshat, Rachana having more followers than you, hope you gain followers for the effort that you are putting. Appreciate it.

[@shankarnath]

Thank you for your good wishes

[@nishilbright2007]

Agreed

[@anuraglodha9338]

Thanks

[@shankarnath]

Thank you very much Anurag ji for your kind appreciation and for this gratuity. I am glad you loved the content and found it informative

[@sushobhanghosh4271]

Hes so aligned & organized in his approach.

[@aadityagupta250]

For some reason, instead of just watching this one as an educational video, I'm really excited about this strategy and seriously considering creating a small satellite portfolio using this strategy. Unfortunately, I'm very low on investible cash as of now. Hopefully I'll accumulate some more soon enough and get started with this. Thanks a lot for the insights and introducing me to this concept!

[@shankarnath]

Most welcome. I'm glad you found this strategy relevant

[@adas19581024]

Only when one buys progressively more quantites during continuous dips , one can easily achieve 18 to 20 percent xirr over a long run

[@sacphilip]

I love the way everything is backed by backtested data and scoring. You just love numbers, dont you? I invest in canada (since I live there) but your calculations are valid across markets If there was a metric for an undervalued youtube account, you would make the list, Shankar.

[@shankarnath]

Thank you very much 🙌 I love numbers and a good story .. it just happened that KZbin offered both via an investing channel :)

[@prashantmalik5333]

Your presentations consistently astound me with fresh and valuable content. I eagerly anticipate your videos.

[@shankarnath]

Happy to hear that, Prashant! The creation of these videos have been helping me upgrade my own knowledge of investing and the selective application of what I'm learning is improving my own investing framework and result.

[@fantasticfinanceformulas4361]

This is unbelievable to see such a gem of info available free of cost. May God bless u. Thanks a lot.

[@shankarnath]

Most welcome

[@gurjota]

Fantastic video Shankar! Even after 10 years in the market, trending value is a completely new investment philosophy for m and I'm already racking my brains how I can use this. My only feedback on the video will be the somewhat misleading comparison between the strategy returns and the Nifty returns as the strategy has 80% small cap stocks. So the comparison should be with small cap index. Sincerely appreciate all your great work and sharing all this wonderful content with everyone. You deserve a million subscribers 😊!!!

[@shankarnath]

Hi Gurjot .. thank you very much. Actually I too thought about it .. but came to the conclusions that if not Nifty then the Nifty 500 or the Nifty 750 should be the ideal benchmark (not Nifty small cap). The reason I feel so is because before the exercise started (by O'Shaughnessy or CapitalMind), none knew the list of stocks that will come out. It just so happened that smallcaps came out because large caps didn't ascribe to it. But if valuations were damp like it was the case in 2003 or 2008, then maybe large caps could also have been a part of trending value. In that context, I feel the total market index will be a more appropriate benchmark. Yes, the smallcap can be a secondary benchmark. Thanks for your good wishes and support as always, Gurjot. I continue reading your tweets and get inspired.

[@siddharthtonde8438]

You continue to just give these gems for free! Thank you so much Shankar Sir.

[@shankarnath]

My pleasure. So nice to you

[@j2f972]

Sir if we pick the top 5 stocks then the risk and volatility will be higher but can we get higher returns as well? Please answer.

[@shankarnath]

Sorry, I don't know. Mr. O'Shaughnessy has done decades of research to come up with this method so I'll sticking to 25 stocks. You can test this out on 5 stocks on your own pls. Btw, there is a revised version of this trending value video -- think you'll find it useful -- kzbin.info/www/bejne/nWfbkqGmecmJhKs

[@anurag5851]

what is the software he is using. M new to this

[@Mikumegabytis]

Your channel is underrated sir 😮. You actually deserve millions of subscriber . I also found useful this channel nd immediately subscribed it 😊😮

[@shankarnath]

Thank you so much. I'm glad you like my work

[@paritshah89]

Suggest you to start a small case for 2 or 3 different strategies. So we can join you on the actual team. I am definitely loving this momentum and value theme Thanks

[@arjunrv]

Great suggestion. Shankar bhai, please consider.

[@varshinivarshinipramodkuma8838]

Very well put together video.. kudos!

[@shankarnath]

Thanks a ton!

[@sharmavikrant]

@Shankarnath - I tried to calculate the returns for 6 months for the stocks in the sheet shared since this video was released by you on 22-Nov-2023 (stock price taken on 10-Nov-2023). It has given staggering 52% returns. Nifty50 has given 16% for the same time period. Thank you for sharing this (and many more) strategies for winning stocks / portofolio. 🙏

[@shankarnath]

Thank you very much for sharing this, Vikrant ji

[@jayneelamana]

I am awestruck with the quality and variety of content and the amount of research and hardwork that has been put into each of your videos. Truly inspiring.

[@shankarnath]

Great to hear! Thank you

[@amitbara6]

Hi shankar.... Needless to say, it is a greatly informative video. Can this strategy be used to invest as in an SIP mode, instead of investing a lump sum amount, and if not, which strategy do you think would be best suited to make investments in SIP mode?

[@shankarnath]

Thank you very much. I guess this can be used as an SIP but please note, the strategy requires an annual rejig in portfolio. So you can buy a stock every month (12 month SIP) from say, the 1st the Jan. But come next year 1st Jan, that stock might have to exit and replaced with a new stock SIP.

[@ashamanami8958]

Thanks a lot sir for this valuable content. I have few queries, 1)Once 25 stocks are obtained from the raw data, how to decide what portion of the total investment should be dedicated to each of these stock. 2)How to go about rebalancing every year

[@shankarnath]

Most welcome 1. Go for equal weighting - 4% to each stock 2. Please read on how to do rebalancing over the Internet. The concept is simple although execution is a bit tougher.

[@jallapavan]

hello sir, using kotak stock case, we can create basket and simulate over 5 y and 1 year , or 10 years

[@adityakapoor001]

@shankarnath Some sectors have low PE and others have high. For this reason, you may never get stocks from those sectors would it not be better if the ratios are considered with respect to the sector itself?

[@shankarnath]

Yes ofcourse. I for one prefer relative PE (i.e. comparison within sector) as compared to absolute PE ratio

[@shriharsha3448]

Instant subscribed - thank you sir I'm very new to this ecosystem, loved the way you have explained

[@shankarnath]

Welcome aboard! Thank you for the kind words

[@sarvan55]

Just curious to know, won't investing in Momentum index fund + Alpha Low Volatility Index fund give similar returns at lower expenses ..?

[@shankarnath]

Interesting. If you have tried it out or are going to, please do share the results incl. the combination of momentum & alpha low vol .. and the rebalancing rule is also important. Thanks!

[@yugandharreddynalabolu9110]

Combination of momentum and value index funds gives the good returns?

[@shankarnath]

Pls watch my video on this: kzbin.info/www/bejne/l4qrg4eGiamnhM0

[@dineshbalu711]

Any ready made EFT or Mutual fund available for this strategy ?

[@shankarnath]

Sorry, I'm not aware of any

[@Deepchand12341]

Alpha prime smallcase. I already have 1 month ago

[@jayabratadhakai3523]

Did the same exercise on Jan 19th 2025. Owing to the recent correction of the market, if I go for the magic number of 25 stocks 7 of them have negative momentum i.e, 6M returns are negative. (ex - City Union, Monte Carlo, GHCL) May be my question is very obvious, still here it goes. Should I include them as part of the portfolio?

[@Dushyantgiri]

Frequency of collecting data, and how to invest is so many stocks? How part is very difficult here.. Why mutual funds don't do this..?

[@shankarnath]

1. Frequency is once a year (its annual rebalancing) 2. Investment can be done via an broker (online or offline), will take 10 minutes to put in 25 orders I guess MFs can't do this because the methodology is a neither an active strategy not a passive strategy. It's designed more as a point to point strategy which suits individuals.

[@UnniKrishnan-gi9ws]

Your videos very helpful and understanding. I was going through the excel shared. The missing values have been assigned a rank of 700 and decile value 5. Is there any reason for why it is done like that?

[@shankarnath]

Thank you! Yes, these are unknown values and hence decile 5 was taken. I read somewhere that this approach was used by O'Shaughnessy so I too implemented that

[@newalljoseph4316]

Smallcase Value and Momentum ; does this follow the same strategy .??

[@shankarnath]

Sorry, I'm not sure

[@RishabhGokhru]

Just imagine all your strategies taught to the AI along with the knowledge of technical & fundamental analysis with knowing the market new & current affairs 🤯 you’ve created a cash printing machine 🎰

[@motivationalmantras6084]

Shankar Sir ! Thank you so much.

[@shankarnath]

You're most welcome

[@AGMS1234]

Please tell me how to did you backtested this strategy. How did you get historical data

[@shankarnath]

Hi, you'll have to connect with the folks at Capitalmind who backtested the strategy. They can give more specifics. I'm sure they would have the required software that can extract data at particular points in the history. Unfortunately the screeners I use are all present-day trailing

[@shantilal007]

Thanks for sharing another informative Video and keep learners gaining knowledge

[@shankarnath]

My pleasure. Glad it helped

[@pushpeshraj4432]

Thanks a lot sir for this valuable content. But i have an issue with data presented by you in the excel sheet. The P/CFO rank is give totally on the basis of its value which is wrong. The company with worst negative Cash flow from Operation will be given better rank than a company with positive Cash Flow. This issue in ranking will effect the whole process after that which may give wrong info to audience. Please take a look

[@shankarnath]

Thanks for letting me know

[@anshularora300]

Hi Shankar sir, thanks for posting this video! Greatly enriching. I wanted point one thing, instead of hard pasting the numbers, can we get formulas in the excel, it helps in better understanding the numbers and would be more uselful. Thank you. ALso Congrats on hitting the 100K being following you since ET money days.

[@shankarnath]

Thanks for the appreciation and the suggestion

[@breathingcloud2356]

Thank you so much for sharing this valuable information

[@shankarnath]

My pleasure 🙌

[@jackyrajgor4076]

Thank you so much for taking out the time and makinh such knowledge enriching videos for us.

[@shankarnath]

My pleasure! So nice of you, I'm happy you liked it

[@NoName-xc6cg]

How do you handle negative pe ratios? Do you just ignore any company with a negative pe ratio?

[@shankarnath]

I append decile 10 to negative PE values

[@sohandandekar8976]

I am not able to download excel myself, do I need to subscribe to the premium plan on screener?

[@shankarnath]

I'm able to do that. Go to File, and the only highlighted option is "Download". Please try in a different browser or take help from a friend.

[@shanmed79]

Very informative & in-depth analysis

[@shankarnath]

Glad it was helpful! Thanks

[@naveenkumarkaranam2799]

Thanks for the insights. As always your videos are always easy to understand and thanks for sharing the work sheet. Surely that will act as a starting point

[@shankarnath]

Thank you very much, Naveen ji. I'm glad the research is understandable and implementable. Honestly, my own investing framework has improved by leaps and bounds after studying all this stuff .. and I'm happy it's helping you aswell.

[@SivayaGuraveNamaha]

Thank you for delving into these investment strategies and offering such insightful analysis. The valuable insights from these videos will undoubtedly benefit the investor community.

[@shankarnath]

Thank you very much. I'm glad you found it useful

[@buddy417]

is there any Mutual fund that follows this strategy?

[@shankarnath]

I've not come across any

[@kaush1624]

Hi Shankar, thanks for the video, collective information and the excel sheet. 1 question I had was the 'price to operating cash flow' ratio was throwing negative values for companies with negative cash flows. and the excel shows we use it as better -centile for calculations. Can you please recommend on how to handle negative cashflow in the excel?

[@shankarnath]

Hello. I don't have an answer for you on how to handle it in an excel sheet. Over time, my own weight towards this metric has weakened as I see many instances where a negative cash flow can be justified or might be necessary. For instance: 1. Investment phase wherein growing companies have to invest heavily in expansion and R&D. This investment is a driver in their future success 2. Strategic expansion like new markets, new products etc. Again, it helps in future growth and profitability. 3. Seasonal variations also affects cashflows temporarily for some indutsries 4. Debt repayment cycles can also lead to negative cash flow etc.

[@kaush1624]

@@shankarnath thanks for the reply. So will use less weightage for this metric as lower can be better but there are cases where negative might not be good.

[@JBande]

In ur related video, u had taken 2 index funds and shown how they performed. Here the outcome is not clear, can one use funds to apply this strategy? The difference in this vs the earlier related video of momentum+value is not clear. Again thanks for excellent videos u r posting!

[@shankarnath]

Thank you very much! The video on Momentum+Value was built around 2 indices. Here - it's built around a few stocks. There are bound of be differences in the way these are setup. If there are any specific questions, please let me know. Alternately, may I suggest you read the Capital Mind article (link in description) or Mr. O'Shaughnessy's book for better clarification

[@inigob.s.6990]

Great Shankar sir ❤ awesome content every time

[@shankarnath]

Thank you very much 🙌

[@maniinvestor]

@6:27 i think you mention value score of 7-16. But 150 stocks have value score of even 17. Including the 6 month returns, I see Jindal saw to be at the top of the list, but the same is missing in the last 25 list of stpcks. Am i missing something here ? Also power finance tops the final list, are there sorted based on any parameter? If so by value score or momentum . Thanks for this information i hope to hear from you on these doubts

[@anupdsouza]

Very interesting and informative! Thanks Shankar :)

[@shankarnath]

My pleasure! Glad you liked it, Anup!

[@illliyas]

Hi, thanks for the video. One question: what is your strategy of selecting top 25 stocks based value and returns on 150 stocks. In the excel, you mentioned as Power Fin Corpn as 1st of 25. Why Jindal Saw is not selected when it has highest returns from the 150 stock list.

[@shankarnath]

The criteria of selection was not historical highest return. The selection was to be done on the basis of the value composite score as per O' Shaughnessy's method

[@prasadrayannavar9117]

Again hit with valuable contact Hatsoff to you

[@shankarnath]

Thank you very much

[@nabeelyahiya]

Thank you for enlightening us ❤

[@shankarnath]

You are so welcome

[@karthikreddy8567]

Sir are there any companies that can do option trading on our behalf while charging some fee?

[@shankarnath]

I'm not aware of any but I won't be surprised if there are dozens of such outfits who will do it. Just try out some telegram channels .. but please be careful. The proportion of gainers from options trading is quite low from what I have heard

[@virendrad9447]

can u share google sheet which automatically makes this list each year

[@shankarnath]

Sorry, I don't know how to make an automatic one. The process itself doesn't take long to implement, maybe 15-20 minutes

[@virendrad9447]

@@shankarnath thanks for the prompt reply. Can u share screener filters u have used. The video is great I am already using ur MF idea of momentum and value funds

[@adeelakhter4865]

What does it exactly mean beating the index? I'm seeing a few companies paying a high dividend but compared to index they are way down.

[@shankarnath]

Performance is tracked on a total return basis i.e. capital gains (due to increase in price of stock and/or index) plus dividend. Looking at capital gain or dividend in isolation is not a good practice .. atleast since the 1950s (data specific to the US). Prior to 1950s, dividends were a big part of shareholder returns but not anymore. In Indian markets, dividend yield is 1.5-2% while the total return is 13-14% per annum.

[@rakeshjoshi1962]

Excellent sir, better you make a screener to use full strategy ie on chartink.I will also try .❤

[@ShailendraKumar-tn7rl]

Sir I have a Qustion...... Can Doing SIP in Momentum and Value Fund in Ratio of 70% : 30% Respectively Can Beat Allocation Strategy of 50% :50%

[@shankarnath]

Apologies, I have no basis of predicting if a 70:30 will be better or worse than a 50:50. Momentum and value although not opposing strategies have a different style factor.

[@originalshovan]

Hi, what is the software or website that you are using to find companies with valuations above 500 crores. Thanks

[@shankarnath]

I use screener.in

[@originalshovan]

@@shankarnath Thanks a lot for your reply.

[@sudharshan358]

Sir is negative Price/CFO bad or good and how should we rank those stocks or should we exclude them?

[@shankarnath]

Kindly exclude them

[@sudharshan358]

@@shankarnath thank you sir 🙏

[@karankadmawala1795]

Great Video. Are there any mutual funds that invest as per this strategy?

[@shankarnath]

Thx. I havent come across any

[@abhijeetmukherjee4883]

Hi Shankar, Thank you for such a great video. Is it possible to have this excel with formulas?

[@shankarnath]

Most welcome. I didn't apply formulas when I created that worksheet, thats why it isnt there

[@abhijeetmukherjee4883]

@@shankarnath Would it be possible to share an Excel with formulas? Thanks so much

[@shankarnath]

@@abhijeetmukherjee4883 As soon I come up with a formula-based excel for this, I will pin it in the comments

[@WorldgeopoliticsbyPrashant]

I wait for your videos sir, great job.❤

[@shankarnath]

Thank you Prashant ji

[@AakashArora_ashu]

Is there any smallcase which follows this strategy?

[@shankarnath]

Not sure. There is one titled" Value & Momentum", managed by Windmill Capital but the methodology might be a little tweaked.

[@suprabha82]

Hi Shankar, shouldn’t we also add PE/G ratio as the 7th metric?

[@shankarnath]

The author (O'Shaughnessy) didn't add PEG ratio in his study

[@suprabha82]

Yes Shankar, but we can add no and do regression analysis/back testing.

[@suprabha82]

Yes Shankar, but we can add no and do regression analysis/back testing.

[@suprabha82]

Yes Shankar, but we can add no and do regression analysis/back testing.

[@suprabha82]

Yes Shankar, but we can add no and do regression analysis/back testing.

[@007_Sun_Tzu]

I am just surprised how this was not told by anyone

[@janusalex]

@shankar, thanks for this video. A request: could you please update this sheet with the script symbol instead of the name? that would be great. Or you can guide me from where I can get the list of >500 market cap for free. Thanks!

[@shankarnath]

Pls use screener.in

[@janusalex]

@@shankarnath it's not free to export :( It's asking for subscription.

[@shankarnath]

@@janusalex Same for me, I simply copy paste the numbers on an excel sheet

[@janusalex]

alright then, thanks for the quick response!@@shankarnath

[@415puneet]

Sir, have a question. Why have the stocks whose PE Ratio is empty assigned a PE ratio rank of 700 ? I can see stocks with PE Ratio (Greater than 0) having ranks above and below 700.

[@shankarnath]

Thats because I wanted to give BLANK values a 5 decile. 700 is half of the universe so automatically it would comes as 5 decile

[@415puneet]

@@shankarnath - Thanks for your reply. I did some digging and these stocks have -ve PE ratio (EPS might have been -ve for these). I used tickertape screener. Shouldn't these be tagged to 10th or 11th decile, rather than plotting them in the middle. Btw, love your content and the data backed approach is a USP that i have not seen other content creators bank upon

[@surajpatil3650]

Hi Shankar, This is very interesting, I am wondering is there any mutual fund available in market which follows this strategy? If not then why? If I have to follow what is simplest way to do it?

[@shankarnath]

Thanks 1. I have not come across any MF around this strategy 2. I'm not sure why that is the case. The fund houses have to be asked individually this, not very practical 3. The simplest way to do this is way I have shown it. It takes 15-20 mins to compile the table and has to be done once a year

[@tushitjain]

What tool do you use to fetch the data?

[@shankarnath]

screener.in

[@sachindevsahoo8497]

Hi Sir, I noted that stocks with negative Price/X ratio have been given a lower rank than the ones with a low positive values. Is this right? Isn't a negative Price/(earnings/cash flow) bad?

[@shankarnath]

Unfortunately there is no literature on these practical issues so it's upto ones assessment of what is right or wrong or acceptable. Pls feel free to modify the worksheet per your assessment.

[@sivakumarvenkata8073]

I have been a silent admirer all thru. Needless to say, thanks for great content. Couple of quick questions- I pulled the data and see that some have no PE and some have -ve price to FCF. What to with those? If I exclude them , my universe goes down from 1800 to 1000. That’s 45% less. Is excluding right thing to do? I just pulled the data from screener for market cap > 500. May be I am doing something wrong.

[@shankarnath]

Hello. You can exclude the stocks with no PE and negative price to FCF. A 1000 stock universe is still quite a bit -- you should be aiming at a 20-25 stock portfolio using this method. Not more.

[@sivakumarvenkata8073]

@@shankarnathwhen I meant universe, it was the first list before ranking.but I got what you are saying. Thankyou.

[@uttamshukla4768]

Hi sir Very informative video. Can you tell how you was able to get data of companies ?

[@shankarnath]

Thanks. The process is exactly the way I explained in the video using screener.in

[@uttamshukla4768]

@@shankarnath Thanks for responding. It is paid or unpaid ?

[@MARKCRASTO]

Shankar, one thing i find misleading in the capital mind report, is that if this strategy is a small/micro cap strategy, then it shouldn't be compared to the nifty50 index. The N50 index does not serve as a justified benchmark. Instead a small cap/micro cap benchmark should be used as comparison. It's clear that capital minds has intentionally excluded this comparison, to make their small cap look more attractive for investors. Please provide this caveat to the video. Thanks

[@shankarnath]

"Misleading" is a strong word, here's why. When Capital Mind started this exercise they didn't know what companies will turn up. They used all companies in the setup with an intention of beating the Nifty 50. Now it so happens that the output turned out a lot of small cappers. But let's go with your advice for Capital Mind and change the benchmark to smallcap index for now. Just curious to know -- will they again be blamed for misleading if the next year, the system shows up a bunch of large cap stocks (instead of smallcaps)? Ergo in my view, the right benchmark is neither the Nifty 50 and nor the smallcap index. It should be the Nifty Total Market Index

[@gnayak18]

how does the trending strategy not cover stocks in the mid to large cap space except very few. do they necessarily pick small caps.

[@shankarnath]

The filter's don't allow. Mid to large caps have higher PE ratios (as a % to their universe), higher PB ratio, higher PS ratio and lower dividend yields. Please refer to my worksheet (link in description) and create a slab using the market capitalization column I have provided there for a better understanding

[@gnayak18]

@@shankarnath thanks. one last point. these 25 stocks have show a sudden spike over last 5 -6 months. when does the trend reversal happen in such a case. is it the end of the rally for all these stocks. technical/ fundamental indicators to identify the rally ending

[@shankarnath]

@@gnayak18 Hi, please connect it with two related points: 1. the definition of momentum that I've explained in previous videos 2. the rebalancing logic explained in this video So momentum rules says that the trend will continue and rebalancing rules say that there will be a change of holdings after a year

[@j2f972]

Hii sir, If we pick bottom 5 stocks with the query of price to sales less than 1 and choose small market cap with highest one year price appreciation then how will the strategy performs because of mean reversion the bottom 5 stocks can outperform the both top 25 stocks and 5 stocks portfolio, What's your advice on this please guide me🙏

[@shankarnath]

Sorry, I don't know how it will perform. My advice is -- please try it by yourself on an excel sheet i.e. test your hypothesis

[@j2f972]

@shankarnath sir how I can back test this strategy please guide muje samjh nhi Ara trading view vagera m to ek chart p hi kr skte h bss ye to stocks h bohot sare

[@shankarnath]

​@@j2f972 I'm not sure myself on how to backtest. I did a follow-up video however where the trending value strategy gave me 96.9% ( kzbin.info/www/bejne/nWfbkqGmecmJhKs ). I'm sure there are backtesting softwares that are available in the market but they would be expensive. Alternatively you can contact Krishna Appala of Capital Mind who authored this article -- www.capitalmind.in/insights/trending-value-india -- and ask him on how to backtest. Afterall he has backtested data for the last 16 years around the trending value strategy. Hope this helps.

[@j2f972]

@@shankarnath Thank you sir for your help 💖

[@dheerajkukal8475]

Shankar sir 🙏 THANK YOU

[@shankarnath]

Most welcome

[@rheopar1325]

Hello sir Huge congratulations on hitting 100K. You are the person who i look up to for any questions and can expect a reply!! Sir what do you think about the future of small caps in the next 10 years I am actually building up a corpus to pay for my term insurance till the end of maturity period Instead of choosing return on premium,its wise to invest the difference premium amount into a mutual fund that will earn returns for you as well as pay for future premium What is best should i invest in a nifty 50 or is small cap safe and atleast generate annualized returns close to nifty benchmark. Please guide me on this Sir!!!

[@nid4u]

no reply to this?

[@vineetsingh6705]

Sir Please make a detailed video in Tata Midcap momentum index

[@shankarnath]

Thanks for the suggestion

[@Journeytodreamsandbeyond9542]

How are you calculating PE ratio-Rank?? PB ration rank??

[@shankarnath]

In excel sheet using the RANK functionality

[@Journeytodreamsandbeyond9542]

Thank you@@shankarnath

[@arvindgandhi1007]

Thank you very much.

[@shankarnath]

You are welcome! 🙌

[@mr.swanand]

❤❤ very informative video

[@shankarnath]

Glad you liked it

[@RajKumar-op1lp]

DECILE CALCULATION FORMULA IN EXCEL SIR?

[@shankarnath]

Sorry. I don't know how to calculate it in Excel. If you know it or find the process, pls share it with me aswell

[@kunalshah2933]

Use The Rank Formula To Rank the P/E Value (=RANK(E5,$E$5:$E$30,1)) In My Sheet the P/E Values are in the E column, Now For The Decile We will use the following formula =CEILING(F5/((COUNT($F$5:$F$30)+1)/10),1) Also Note My data starts from 5th Row Hence F5. Let Me Know if this is helpful and if there is an error please feel free to point out

[@sagargupta1732]

Simply you should invest in midcap fund or index, isn't it more simple?

[@shankarnath]

Yes, definitely more simple if simplicity is what you seek

[@abhijeetmukherjee4883]

Hi Shankar, Kudos for such a great video. Pls provide an excel with formulas! It will help us with future rebalancing.

[@shankarnath]

Thanks for the suggestion

[@sohamkundu273]

Hi Shankar, I was thinking of including the following conditions during preliminary screening to narrow the universe even further: - Market Capitalization > 500 AND Debt to equity < 0.5 AND Profit growth 5Years > 10 AND Profit growth 3Years > 10 AND Profit growth > 10 AND Sales growth 5Years > 10 AND Sales growth 3Years > 10 AND Sales growth > 10 AND Average return on capital employed 5Years > 15 AND Average return on capital employed 3Years > 15 AND Return on capital employed > 15 AND Average return on equity 5Years > 15 AND Average return on equity 3Years > 15 AND Return on equity > 15 AND Price to Earning < Industry PE AND Book value 5years back < Book value 3years back AND Book value 3years back < Book value As of today (17-01-2024) this screen is giving 34 results.

[@rru02]

This strategy is more oriented towards small & microcap stocks. Why compare it with nifty50? I personally feel that it would have been better to compare it with smallcap index.

[@shercheeta3]

Yes - would be good to see that analysis

[@shankarnath]

Thanks for the suggestion. In my view, it should not be the smallcap & microcap index .. and it should have been the Nifty Total Market index (750 stocks) because when Capital Mind started the activity, they didn't know it will be smallcaps that will turn up in the output. Even when I did it with 1521 companies, it included large, mid, small & microcaps. The strategy just happened to favour small/microcaps; ergo; the comparison with the all-market index is the fair way to look at it. If I meet Deepak or Krishna, I'll pass this feedback to them

[@rru02]

@@shankarnath Thanks for considering. By the way appreciate your effort in providing different viewpoints and strategies. Given my day job, its difficult for me to analyze market in detail.

[@suprabha82]

Hi Shankar, you sound almost like Rajeev Masand 😃

[@shankarnath]

Thank you from me & Rajeev

[@HimanshuSharma-ec6hy]

Namaste Mr. Shankar- Appreciate your view on sustainable evolution of ‘Carbon Neutrality’ theme on medium-long term basis, it’s relevance and significance from EMs (like India) growth’s perspective? Can you please suggest names of few listed stocks which we should research/study?

[@shankarnath]

Namaste. I'm sorry, I have not tracked this sector. May I circle back to you once I have gone through this?

[@HimanshuSharma-ec6hy]

@@shankarnath appreciate and thank you

[@kothapallistorybook-hindi]

00:01 Trending Value Strategy has outperformed the market index by 10% annually over 45 years. 01:48 Combining value and momentum strategies can achieve an average yearly return of 21.2% over 45 years. 03:22 Value composite score is determined by six key variables: Market Cap, Debt, Earnings, Dividend Yield, P Ratio, and PB Ratio. 04:50 The value score is determined by ranking companies based on multiple variables and adding up their scores. 06:17 Beat the index by 10% annually over 45 years with the Trending Value Strategy 07:47 Price appreciation in last 3 years ascribes to momentum strategy, need to be mindful of prevailing style in the market and rebalance portfolio annually. 09:15 Trending value strategy on Indian stocks beats the index by 10% annually. 10:47 Trending value strategy offers high returns but is volatile

[@narsimha5648]

Liked and subscribed 👍

[@shankarnath]

Welcome aboard

[@NathanielDesowja]

Sir, what about negative p/cfo ratio? You ranked them better than those with positive p/cfo ratio

[@shankarnath]

It's a good point. I might have ignored that rule, my mistake

[@paawanangra7666]

Sir, I've used the ticker tape screener. The data has no values where a negative cfo is considered. Would it be wise to assign them a 5 decile or a 10 decile?

[@paawanangra7666]

Sir, I've used the ticker tape screener. The data has no values where a negative cfo is considered. Would it be wise to assign them a 5 decile or a 10 decile?

[@shankarnath]

@@paawanangra7666 I have no prior reference on the handling of negative CFO. Left to me, I would put them in decile 10

[@yogeshmaheshwari5992]

Sir if you do complete vedio in Hindi it will be more helpful

[@shankarnath]

I will try. Thanks!

[@rohitjain6879]

Please also make video on nifty alpha low volatility 30 index fund

[@shankarnath]

Thanks for the suggestion

[@arunmaddy997]

Nice video, thank you for getting this in an understandable format, will this sheet be refreshed on a regularly basis?

[@shankarnath]

I plan to update information in this worksheet and my other videos in a separate section of my newsletter (website). The idea is to have everything in one place.