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

Gold is getting scarce

The world’s gold supply is dwindling at an alarming pace. While gold exploration budgets continue to rise, the number of new gold discoveries has plummeted. In the decade from 1990 to 1999, there were 183 discoveries. However, this figure has declined dramatically in . . . .

Projections usually go wrong!

The market is currently predicting a gradual decline in the Fed funds rate over the next two years. As of 24 September 2024, the rate is expected to decrease from 5.19% to 4.22% by the end of 2024 and to 2.94% by the end of 2025. This forecast is based on the belief that the Federal Reserve will gradually . . . .

Have the right expectation

The current market environment is extraordinary. For the past 53 months, the Nifty 50 total returns index has not experienced a 5% decline from a close-to-close basis. This is a remarkable feat, especially when . . . . .

Effect of timing the market

Imagine investing $10,000 in the S&P 500 over a 20-year period. If you stayed invested the entire time, your investment would grow to $64,000. But what if you had missed the seven best days during bear markets? Your investment would have only grown to $29,000. And if you had missed the 20 best days, it would have . . . .

Got Gold ?

Gold has long been regarded as a safe haven asset, offering protection against market volatility and inflation. This blog highlights the consistent performance of gold across various currencies over the past 24 years . . . .

Are large caps going to make a comeback

The performance of large-cap and small-cap stocks has been diverging significantly in recent years. In the United States, large-cap stocks have outperformed small-cap stocks, while the opposite is true in India. In India, the small-cap index has risen dramatically compared to the large-cap index. This trend has persisted for . . . .

The changing trade map

In 2000, the United States was the dominant trading partner for many countries. However, by 2020, China had emerged as a major force in international trade, overshadowing . . . .

The importance of sector rotation

A recent study has provided insights into how different sectors of the economy have performed over the past decade. One of the key takeaways from this analysis is that not all sectors perform well every year. In fact, only a few years, such as 2014, 2021, and partly 2024, have witnessed . . . .

Contrarian view on Large caps

In recent years, mutual fund investments have shown a significant shift in where the money is flowing. Over the last six years, especially during a period where the market has been largely bullish, it seems that large-cap active mutual funds have not been receiving as much investor attention. In fact, for every ₹10 that has flowed into active mutual funds, less than ₹1 has gone into. . . .

Eurozone benefits from gold

Gold has long been considered a safe haven for investors, and recent trends continue to highlight its importance in a diversified portfolio. One interesting observation comes from the French CAC 40 index, which shows how gold and equities can behave in different ways, especially during times of market stress. Over the past ten years, from 2014 up until COVID-19, both the French stock market and gold in euro terms moved somewhat together. However, after the pandemic . . . .

WeekendInvesting Specials !

When will you lose your patience

When will Markets Double from Now ?

Markets this week

It was another good week where the markets headed for new highs, although there is still disbelief. At every thousand-point level in Nifty, there’s skepticism that it can climb higher. Just six or eight months ago, 20,000 seemed unachievable. Now, with Nifty sitting above 26,000, every milestone seems unlikely until it is reached. While a correction is inevitable—trees don’t grow to the sky—you can’t avoid investing out of fear. Many investors who exited mid and small cap stocks months ago or moved to cash now regret their decision. Even if the market seems irrational, irrationality can persist for a long time. The earnings of top FMCG players in India have defied expectations for decades. If this is India’s decade, the market could continue its strong performance. Trying to time the market by pulling out during highs and re-entering during dips is challenging and often unsuccessful. Instead, it’s wiser to follow the market and adopt the “BBC principle” (Bhav Bhagwan Che) : go where the market goes and profit from it.

This week, the Nifty’s trend was consistently upward, continuing from the previous week. Nifty rose from 25,800 to nearly 26,200, gaining around 400 points, with only Friday seeing some profit-taking. The weekly chart shows a three-week strong upward trend. While a short-term pullback may occur, it’s worth noting that from March 2023, Nifty has risen from 17,000 to nearly 26,000—an impressive 9,000-point increase in just 18 months. This translates to more than a 50% gain in that period, which naturally raises expectations of a market correction.

Benchmark Indices & WeekendInvesting Overview

The Nifty Next 50 made a comeback this week, gaining 3.1%, while Nifty rose by 1.5%. CNX 200 and CNX 500 both gained over 1%, but mid and small caps were largely flat, continuing their underperformance from the previous week.

In terms of Weekend Investing strategies, Mi India Top 10 performed well, up 3.7%, followed by Mi NNF 10 at 3.3% and Mi MT Allcap at 1.8%. NG 5050 gained 1.7%, marking a 15% increase for FY 25, making it a solid performer. On the other hand, small and mid-cap strategies struggled, with Mi ST ATH down 1.1%, HNI Capital Compounder down 1.8%, and Mi 20 falling 2.9%. There is an apparent slowdown in the small and mid-cap space.

Sectoral Overview

In sectoral performance, metals zoomed ahead with a 7% gain for the week, followed by public sector enterprise stocks up 5.1%, autos up 4.6%, and commodities up 4.5%. Energy rose by 4%, while PSU banks gained 3.4% but are still in the red for FY 25. Other sectors like real estate, consumption, infra, and pharma saw gains of around 1.5%, while IT was knocked out this week. Bank Nifty and FMCG saw little movement, with private banks down 0.4% overall despite some intraday comebacks. It appears that the market is shifting toward a risk-on trade, with sectors like FMCG, IT, and pharma taking a backseat to metals, autos, and commodities.

Looking at sectoral momentum, metals are currently leading, followed by autos, real estate, and energy in the short term. Over longer periods, autos, consumption, metals, and real estate are the strongest sectors, with pharma also performing well. This provides a good indication for discretionary long positions, particularly in these sectors. Momentum scores are also helpful in spotting rapid shifts. For example, consumption stocks have dipped recently, while energy is gaining momentum in the short term. PSU banks, on the other hand, remain towards the bottom of the momentum rankings.

WeekendInvesting Strategy Spotlight

NTPC – 2x (Mi India Top 10)

This week’s spotlight is on NTPC, a stock that was long overlooked. From 2007 to 2021, NTPC was stuck in a consolidation phase, and investors largely ignored it. Public sector stocks like NTPC were often dismissed as poor investments. However, these stocks have performed well in recent times.

Without any sector bias, a solid strategy can pick up momentum in stocks like NTPC when the trend shifts. NTPC has surged from below ₹100 to ₹436 since 2021, an unexpected rise for many investors. Mi India Top 10 identified NTPC near its all-time highs at ₹218, and we’re still holding onto it.

This demonstrates the power of markets—stocks that stagnate for years can suddenly surge. The consolidation period can act as a foundation for a fresh momentum. NTPC could continue to rise or slump again for years; a good strategy will manage both scenarios.

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