The WeekendInvesting Newsletter

Another brand new initiative from our Research Desk is The WeekendInvesting Newsletter. This is a daily newsletter that summarizes all the stories we cover during the day(market nuggets), including the daily byte that we shoot every evening. This newsletter will be delivered to your email every evening on market days, providing you with a wealth of market-related information. The newsletter includes both summaries and long-form blogs for all the market nuggets covered. These blogs are also linked to the videos we shoot, so you can choose to watch or read the content according to your preference.

Check out our past newsletters.

From the Research Desk of WeekendInvesting

Do not copy others blindly

A simple online cartoon illustrates a giraffe in a lake, encouraging its friends to join by saying it’s not deep. This humorous image carries a powerful message for investors. While one person might feel comfortable in a situation, another might be out of their depth. Everyone’s financial situation, risk tolerance, and goals are different, which makes investing   . . . .

Is Nifty Jr about to make a top ?

The Nifty Next 50 index has shown some interesting patterns over the years. By analyzing its monthly chart, we can see that it has experienced three distinct peaks in the past, and these peaks may give us clues . . . .

Stay agnostic to stock names

It might come as a shock to many, but over the last 20 years, Domino’s Pizza has outperformed Google (now known as Alphabet) in stock performance. If someone were to ask which of these two companies had done better in the stock market, most people would likely say . . . .

Importance of active strategies

When we look at stock market data from the past 140 years, it’s clear that the journey has not always been smooth. For example, the S&P 500 index has seen long stretches where returns have been . . . .

Will India benefit if Trump comes in ?

With the potential of Donald Trump returning to power in the 2025-2028 period, there is an interesting outlook on how global economies might be impacted. According to a global economic assessment by Nomura, India could be  . . .

Should High PE bother you ?

A recent analysis sheds light on the current state of price-to-earnings (PE) ratios across a broad selection of companies in the Indian stock market. With data from over 1200 companies in the BSE All Market Index, the study categorizes these firms based on their PE ratios. What’s interesting is that  . . . .

How momentum picks multibaggers

Since the COVID-19 market crash, many small-cap stocks have shown remarkable growth. According to a recent analysis, a large number of companies have seen their stock prices increase by ten times since the market bottom in March 2020. A “ten-bagger” refers to a stock that has multiplied tenfold, and it’s clear that  . . . .

Breaking out of the middle class mould ?

A fascinating point about the middle class is how they drive consumer demand, not just because of their purchasing power but because they are attractive borrowers. Middle-class consumers often finance their purchases through loans and EMIs (Equated Monthly Installments), allowing them to . . . .

Cheap markets should not be bought

A recent comparison between the Chinese and US stock markets reveals an interesting trend: Chinese stocks are getting significantly cheaper compared to their US counterparts. In fact, China is currently valued at just 40% of the US markets in terms of price-to-earnings (P/E) ratio. This is a drastic change from . . . .

Should you start a business?

In recent years, there has been a noticeable shift in how taxes are collected in India. Corporate tax, which was once significantly higher than individual income tax, has seen a decline in comparison. About five years ago, corporate tax collections stood at ₹5.5 lakh crores, while individual income tax collections were slightly lower at ₹4.92 lakh crores. However, this trend has reversed, and now . . . .

WeekendInvesting Specials !

Massive Shift in Market Dynamics ?

Shocking Impact of this MAGIC ASSET !

Markets this week

Another week where Nifty surprised everybody and closed at an all-time high. Nifty was very steady throughout the beginning of the week, but after the Fed’s announcement of a half-percent rate cut on the 19th, the market opened with a gap up, giving back most of its gains. On that day, the sentiment was that there might not be any further upward movement in the short term since all the expected news had already come out. However, the next day surprised everyone as the market surged, experiencing a big intraday swing before closing at 25,820, catching short sellers and bears off guard.

The Nifty weekly chart now shows a bullish engulfing pattern, countering the previous week’s bearish engulfing. This is a strong signal, and the bottom formed over the last two weeks is now a significant level. If that bottom is broken, it could indicate the start of a downtrend.

Benchmark Indices & WeekendInvesting Overview

Nifty gained 1.7%, CNX 200 was up 1.3%, and CNX 500 rose by 1.1%. However, Nifty Next 50 only managed a 0.1% gain, and the Mid and Small Cap index was flat. The Small Cap 250 index actually lost 0.4%, indicating that the action was primarily in large caps, though Nifty Next 50 didn’t participate.

Among the WeekendInvesting strategies, Mi 20 stood out with a 2.7% gain for the week, followed by Mi Evergreen at 2%, and HNI Capital Compounder at 1.6%, making it the top performer of FY25 at 41.8%. Mi All Cap gained 1.5%, India Top 10 was up 1.1%, and Mi ST ATH rose by 0.4%. On the other hand, some strategies lost ground: Mi ATH 2 dropped by 0.3%, Mi NNF 10 by 0.7%, Mi 30 by 0.8%, HNI Wealth Builder by 1.3%, and Mi 25 lost 1.4%.

Sectoral Overview

Sector-wise, real estate led the way with a 4.6% jump, while private banks rose by 3.8%, supported by rate cuts and expectations of future credit growth. Consumption stocks also performed well, anticipating a softer interest rate regime. Autos gained 2.2%, with expectations of better festive sales and potentially lower auto loan rates. Most other sectors saw gains between 0% and 1%, while PSU banks did not rise with private banks, showing a divergence. Public sector enterprise (PSE) stocks also lost 1.5%, and the sheen seems to be fading from some public sector companies, though some like shipping and railway companies are still performing well. Pharma and IT stocks also declined this week, which is understandable as the market has shifted from defensive sectors to more risk-on parts of the market.

Looking at sectoral momentum rankings, consumption leads, followed by FMCG, financial services, real estate, and autos. Real estate, which was down over the last three months, has been running hard in the last two weeks, while pharma, which was strong over the previous three months, has slumped recently. This highlights the ongoing sector rotation, with consumption and FMCG still dominating overall.

WeekendInvesting Strategy Spotlight

Suzlon – A break out stock

In the WeekendInvesting strategy spotlight, there’s a case study on Mi 35, focusing on Suzlon. Suzlon, which fell from over Rs400 in 2008 to below Rs2 at its lowest during the COVID period, has now resurrected to Rs83.45.

During the drawdown, no momentum strategy picked up the stock, but once the upward phase began, Mi 35 was able to enter at Rs15 and exit at Rs42, while some strategies are still holding the stock. This shows how momentum strategies avoid stocks that are in continuous decline and only capture them when they enter an uptrend.

The Mi 35 strategy has returned 188% since its inception, compared to 105% for its benchmark. The strategy focuses on small-cap stocks, reviewing the portfolio every week. It’s a rotational strategy with 35 small-cap stocks, and the recommended capital for this strategy is between Rs5 and Rs30 lakh, with a 4-5 year outlook.

Rebalance Update

We give advance notice here on the upcoming changes in your smallcase for Monday. This advance notice can be used to ignore Monday’s update if there is no change. If there is a change indicated you can use the smallcase app or log in to weekendinvesting.smallcase.com to see the rebalance. A backup email is sent by mid-day Monday if you have not rebalanced by then and yet another one a

Note: We are not including LIQUIDBEES as an ADD or an EXIT count.

WeekendInvesting Strategies Performance

WeekendInvesting Products – LIVE Index Data

Many of you had asked us to make the index series of all WeekendInvesting Products available so that you could perform your own analysis and studies. You can find a link to the LIVE sheet here and also on the HUB under the support column in the content tab.

Disclaimers & Disclosures

That’s it for this week. See you in the next week’s edition