The top 10 stocks in #Nifty50 contributes more than 55% weight-age, the remaining 45% comes from other 40 stocks. This weight-age changes yearly twice based on stock performance. What if I choose to do SIP of Rs.10,000 every month only with Top 1 stock from this list?
I downloaded last 13 years historical Nifty50 constituents from niftyindices.com and grabbed the top stock based on weight-age. Allocated Rs.10,000 every month into that stock.
Used @ValueResearch portal to upload the transaction to compute the final results inclusive of Bonus, Splits, Dividends etc. In last 13 years, these 5 stocks #HDFCBANK #ICICIBANK #ITC #RELIANCE & #INFY had the highest weight-age at different periods.
Total #SIP investment was around Rs.15 lacs in last 13 years and the fund value now is Rs.49 lacs, annualized return was 16%. If I had did the same SIP with #Niftybees my returns would have been around 12% to 14%.
But using the same index stocks, we are able to beat the index returns by using the simple rule of focusing on the top stock. Usually 20% of index stocks is responsible for the 80% of movement in index, but this test shows just top 1 stock can outperform index in the long run.

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More from @kirubaakaran

29 Sep
What is Rakesh Jhunjhunwala's Investing Strategy, is there a way where we retail investors can follow his strategy and generate similar returns like him? We did an extensive research and this is what we found. A short thread
We all know that Rakesh Jhunjhunwala made headlines recently with his ZEE stock purchase, where he made 67 crores profits in just 6 days. Even though many claims it’s an insider trading, he might have known about the ZEE Sony merger news beforehand.
As per bulk deal report from NSE, he bought the stock on 14th Sep 2021 at Rs.220 and on that day ZEE stock closed at Rs.260 and retail traders still got the time to invest in ZEE stock, from Rs.260 the stock went up to Rs.330 in next one week, that’s almost 27% returns.
Read 16 tweets
10 Sep
I have worked with Infosys and other IT companies for 10 years, let me explain why the mess up with tax portal happened and how #TCS attacked #Infosys indirectly through this ₹4200 crore IT portal project in this 🧵
When it comes to handling government projects TCS is the real king, not only in India they run government projects for many countries, TCS have decades of experience and expertise in handling various govt projects successfully.
TCS handles major project like Passport Seva Kendra, India Post and IRCTC. We all know how flawless these portals are. Infosys won the Tax project through a bidding process. The Income Tax portal was previously run by TCS. Once TCS lost its project to Infy, problem started.
Read 8 tweets
9 Sep
Most beginners when building a trading strategy simply use current info and test with it, they don't know How to Get Historical Stock Futures lot size, list of stocks that are part of index like Nifty 50, Nifty 500 historically, I will share all such info in this thread
Please note that there is no way to get the historical lot size of stocks futures, NSE don't publish it directly, so we need to do some calculated steps to get that data. Download Market Activity report www1.nseindia.com/products/conte…
The zip file contains multiple files, open the second file.
Read 20 tweets
13 Jun
We are launching an easy-to-use execution platform called #OptionX where any traders can automate their option trading strategy with a click of a button. Also they can simply copy/paste their existing strategy from @stockmock_in and execute it with optionx.in Image
list of pre-defined strategies available in OptionX, you just have to click on any of the strategy and execute the same. If a user want to execute Short Straddle strategy, he just have to select it, enter the desired stop loss %, I have specified 25% in the below example. Image
And click on Trade button, you just have to select your broker. Image
Read 15 tweets
2 Jun
Warren Buffett is the richest investor of all time. Everyone knows that, but he is not actually the greatest-when measured by average annual returns. Jim Simons, the one who runs the most successful hedge fund in the world Renaissance Technologies has made 66% annually since 1988
No one comes close to this record. Warren Buffett has compounded around 22% annually. But how come he is richer than Jim Simons who has made higher returns than Warren Buffett.
Warren Buffet started investing at his very early age when he was 10 years old. His networth is around $85 billion, of that $84.2 billion was accumulated after his 50th birthday. His skill is investing, but his secret is time.
Read 5 tweets
2 Jun
Why you should not invest in fixed deposit? Once we start earning and make some lump sum money, one of the most common recommendations from our parents would be to invest that into Fixed Deposit. Does it really makes sense now,if one invest in FD for long term? Let's check it out
If you Invest 1 lac in FD for 10 years with current interest rate of 5.4%, your 1 lac grows to 1.7 lacs in ten years. But after tax, your FD interest rate will be just 3.92%, so after ten years your post tax returns would be only Rs. 1.47 lacs only.
But consider the inflation, remember what was the #petrol and #diesel price before 10 to 15 years? Currently, we pay around Rs.100 per litre, but in the year 2003 it was just Rs. 33. The fuel price alone increased more than 203% in last 15 years.
Read 9 tweets

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