Asset Management
Core portfolio:
Concept: The core portfolio is based out of the theme – “Pharma Boom”. There has been a shift in the healthcare sector from a communicable disease to a lifestyle disease orientation. The Indian pharmaceutical industry is expected to shift from a branded market to a more generic market. Government initiatives like “Jan Ayudyog” are expected to accelerate the generic boom in India.
Bench Mark Index: The benchmark index which the portfolio attempts to mirror is CNX-Pharma. CNX Pharma Index is computed using free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to particular base market capitalization value. CNX Pharma Index can be used for a variety of purposes such as benchmarking fund portfolios, launching of index funds, ETF’s and structured products.
Satellite Portfolio:
Concept: The satellite portfolio is devised using a quant based strategy. A set of quant based filters are devised to arrive at a specific sets of stocks. The allocation of funds within stocks is also arrived using a quant based model.
1. Sectoral Filter: Three sectors are chosen based on a weighted score of three parameters – Maximum returns, Minimum risk and Maximum risk-return ratio. The top three sectors with maximum scores are chosen for allocation
2. Fundamental filter: Once the sector indices are put through the quant filters and the top three sectors are chosen, the stocks under each sector is exposed to a fundamental screening. The following fundamental filters are used:
a. Market Cap of stocks should be greater than 100 crores.
b. The company should have a positive cash flow for the last five years.
c. The company should maintain a growth of 10% or above for the past three years.
d. The earnings ratios of the company should be better than the industry average.
e. The operating margin and net margin should be positive for the past five years.
Timelines:
Concept: The core portfolio is based out of the theme – “Pharma Boom”. There has been a shift in the healthcare sector from a communicable disease to a lifestyle disease orientation. The Indian pharmaceutical industry is expected to shift from a branded market to a more generic market. Government initiatives like “Jan Ayudyog” are expected to accelerate the generic boom in India.
Bench Mark Index: The benchmark index which the portfolio attempts to mirror is CNX-Pharma. CNX Pharma Index is computed using free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to particular base market capitalization value. CNX Pharma Index can be used for a variety of purposes such as benchmarking fund portfolios, launching of index funds, ETF’s and structured products.
Satellite Portfolio:
Concept: The satellite portfolio is devised using a quant based strategy. A set of quant based filters are devised to arrive at a specific sets of stocks. The allocation of funds within stocks is also arrived using a quant based model.
1. Sectoral Filter: Three sectors are chosen based on a weighted score of three parameters – Maximum returns, Minimum risk and Maximum risk-return ratio. The top three sectors with maximum scores are chosen for allocation
2. Fundamental filter: Once the sector indices are put through the quant filters and the top three sectors are chosen, the stocks under each sector is exposed to a fundamental screening. The following fundamental filters are used:
a. Market Cap of stocks should be greater than 100 crores.
b. The company should have a positive cash flow for the last five years.
c. The company should maintain a growth of 10% or above for the past three years.
d. The earnings ratios of the company should be better than the industry average.
e. The operating margin and net margin should be positive for the past five years.
Timelines: