Funds that usually fall less during corrections tend to do well over the long term.

Parag Parikh Flexi Cap is a good example of this.

But how do you pick funds like PPFAS Flexi Cap in other categories?

Here’s the framework and a list of 8 similar funds across categories.

A🧵 Before we share the names (it’s in tweet 10), let's quickly examine how we selected them.

We looked at 5 popular fund categories.

(1) Multi Cap, (2) Large & Mid Cap, (3) Flexi Cap, (4) Mid Cap and (5) Small Cap.

We filtered them in 3 simple steps.

Have you started an SIP recently and feel underwhelmed by the returns?

There’s something called the 8-4-3 SIP rule.

It explains how returns truly work over time.

Let’s understand this in detail. 👇 🧵 8-4-3 is a compounding rule.

First 8 years – Returns are usually modest. This period can test your patience.

Next 4 years – Your corpus nearly doubles.

Next 3 years – Compounding accelerates.

Let’s understand this with an example.

Are markets still overvalued?

Sensex is down 13.6% since it hit an all-time high in Sep 2024.

The pain is worse in mid and small caps:
BSE Midcap: -21.4%
BSE Smallcap: -24.2%

Despite such a steep correction, markets are still not fairly valued, as per long-term data.

A🧵 To answer that, we'll analyse 4 key valuation metrics:

1. Price-to-Book (P/B) Ratio
2. Cyclically Adjusted P/E (CAPE) Ratio
3. Market Cap to GDP Ratio
4. Bond Equity Earnings Yield (BEER) Ratio

Let’s start.

Mid-cap & small-cap stocks have seen massive corrections.

Will PPFAS MF use this opportunity to increase allocation in them?

In a recent call, the fund house addressed this question.

It also shared many more insights, which can help you in your investing journey.

A 🧵 Will PPFAS Flexi Cap increase mid- and small-cap exposure now?

The fund house is exploring opportunities but is still cautious.

Since 2017, they’ve kept mid- and small-cap exposure below 20%.

By Dec 2024, small-cap allocation had fallen to just 2.81%.

Market realities are changing.

What are the trends you should watch out for?

A 🧵 on 5 trends that smart investors are tracking (that you might be missing). 👇 1. Small caps appear to be in the worst shape

Markets have been weak, but the real pain is in small-cap stocks.

Check how different indices have fallen from their peak in Sep 2024:

Nifty 100: 17.4%

Nifty Smallcap 250: 26.14%

The answer to this is in their earnings.

Many equity schemes of Invesco MF (@invescoindia) gave stellar returns in 2024.

-Invesco Contra: 31.37% vs Cat Avg: 21.97%

-Invesco Flexi Cap: 36.51% vs 21.99%

-Invesco Focused: 44.95 vs 21.00%

What has worked for them?

Are they using some high-risk strategies? A 🧵 1. Growth Investing

Fund managers of Invesco MF don’t mind high valuations if the growth potential is strong. This is clear from the high PE ratio in their schemes.

As of Dec 2024, all Invesco equity funds had P/Es above 60, while P/Es of key indices ranged between 20-40.

Imagine having a fund that makes returns amid both rising and falling markets.

This is possible through long-short strategies, which mutual funds don’t offer.

So, SEBI is introducing Specialized Investment Funds (SIFs) for retail investors.

How will they work? A 🧵 What Makes SIFs Special?

Like mutual funds help you ride on the stock-picking skills of fund managers, SIFs let you leverage their expertise in derivatives trading.

With long-short strategies, SIFs will aim to profit in both rising and falling markets.

Markets are bleeding.

Nifty 100 is down 15.35% from its peak in September 2024.

The fall in mid-cap and small-cap indices is even worse.

But even in this sea of red, a few stocks have stayed afloat.

Which are these companies? A thread. 🧵 Let’s start with large-cap stocks. 

The Nifty 100 index touched its peak on Sep 26, 2024. 

Since then, 94 out of 100 large-cap stocks have delivered negative returns.

Only six are in the green, with Bajaj Finance leading the pack.

See the other 5 stocks in the table.

ICICI Pru Bluechip Fund has beaten the Nifty 100 across different periods.

It is also the biggest large-cap fund.

Lately, it has gained traction amid valuation concerns in mid-cap & small-cap stocks.

So, we reviewed its performance & strategies. A 🧵 In this analysis, we will cover 3 key aspects:

-Performance (SIP, calendar year, and rolling returns)
-Ability to protect losses during tough times
-Stand-out investment strategies

Let’s start. 👇

India’s 64-year-old Income Tax law is getting a complete makeover.

A new Bill promises a simpler and more modern tax system.

There are 6 big changes. Let’s have a look. 🧵👇 Before discussing the changes, let’s first talk about what has NOT changed.

The old tax regime is NOT being abolished.

You can still choose between the old & new regimes.
And no new taxes are being introduced.

The bill is about simplification, not increasing your tax burden.

Hexaware Technologies is making a comeback to the Indian stock markets with a massive ₹8,750 crore IPO.

This is the biggest IT services listing since TCS in 2004.

Should you consider subscribing?

Let’s find out🧵 Hexaware was delisted in 2020 by its previous owner, Baring PE Asia.

A year later, Carlyle Group acquired the company.

Now, Carlyle is taking it public again.

Stock splits and bonus issues both increase the number of shares you own.

But why does a company choose one over the other?

And what does it mean for investors?

We break it down. A🧵 Let’s start with stock splits.

A stock split is when a company divides its existing shares into smaller units.

Mathematically, this should lower the price of each share but keep the total value of your holdings unchanged.

The RBI just slashed the repo rate by 25 bps to 6.25%—the first rate cut in nearly 5 years.

But buried in the announcement were 3 important updates no one is talking about.

Let’s break them down. 🧵👇 1. RBI’S BOND TRADING PLATFORM MADE ACCESSIBLE

The RBI and the government have been trying to expand India’s bond market for years.

Both have taken several measures to increase retail investor participation.

Taxable income: Rs 12 lakh → Tax: Rs 0

Taxable income: Rs 12.1 lakh → Tax: Rs 61,500

It would be unfair if you lose a lot in taxes for earning slightly more than Rs 12 lakh.

That’s why there is marginal tax relief.

What is it? How does it help? A🧵 First, some basics.

Your income tax is calculated slab-wise.

For example, say your taxable income is Rs 12.1 lakh.

You won’t pay a flat rate of tax on this.

Here’s how the tax is calculated. 👇

Budget 2025’s Big Announcement:

If your taxable income is up to Rs 12 lakh per year, you pay ZERO tax.

But then, why do we still see tax slabs below Rs 12 lakh?

What is the use of these slabs?

How does it impact you? A 🧵

#Budget2025 If your taxable income is up to Rs 12 lakh, your tax liability is zero.

But what if your salary is more than Rs 12 lakh?

Then, these tax slabs come into the picture.

And different portions of your income are taxed at different rates.

Example. 👇

The concept of averaging down sounds simple.

Buy more shares when the price drops, lower your average cost, and wait for the price to go up.

But does it really work?

Let’s understand with some real-life examples & case studies.

A 🧵 Let’s understand this strategy with an example.

Say you buy 100 shares of a company at Rs 500 each.

A week later, the stock drops to Rs 450.

To take advantage of the lower price, you buy another 50 shares.

So, your average cost per share now falls from ₹500 to Rs 483.

Which stocks did mutual funds reduce their holdings in last month?

We analyzed the portfolios of all diversified equity funds to identify 9 such stocks in the large-cap, mid-cap, and small-cap space.

Let's start with 3 small-cap companies. 👇🧵 3 mid-cap stocks where mutual funds reduced their exposure last month:

- Tata Technologies
- Steel Authority Of India
- Patanjali Foods

PPFAS Flexi Cap reduced exposure to small caps last year.

However, HDFC Flexi Cap & JM Flexi Cap played it differently.

Both have raised their allocation in small-cap stocks.

Let’s dive into the investment strategies of these 3 most popular Flexi Cap funds of 2024.

A 🧵 The 3 Flexi Cap funds we analysed were among the favourites of investors in 2024.

And why not?

They’ve beaten both the Nifty 500 and their category average by a solid margin. (see table)

In this analysis, we’ll unpack their investment strategy to understand them better.

Nifty 500 is around 11.3% down from its 52-week high.

But the correction is more brutal at the stock level:

- 211 stocks have plunged over 30%
- 212 stocks are down 15-30%
- Only 77 stocks have fallen less than 15%

A 🧵 on what you can do to build a bulletproof portfolio to handle.

Credit to Aashish P. Somaiyaa (@AashishPS), CEO of White Oak Capital MF, whose recent newsletter provided many insights for this thread. Let’s first understand what has happened in the market over the last few years.

Amid the recent bull run, market segments like defence, railways, PSU, and manufacturing have benefitted from macroeconomic tailwinds or government policies.

There are currently 11 NPS fund managers.

The gap between the best and worst is huge.

Which one should you pick?

Let’s check their performance & find out.

Retweet the🧵 to educate other investors. All the 11 NPS fund managers offer 4 types of schemes:

Scheme E (Equity)
Scheme C (Corporate bonds)
Scheme G (Government bonds)
Scheme A (Alternative investments funds)

You can have different fund managers for different schemes.

Mahindra & Mahindra’s stock has done far better than its rivals over the last year.

But where do its financials stand?

Let’s put M&M, Maruti Suzuki, and Tata Motors head-to-head to find out which is the best automobile stock in India.

Retweet the 🧵 to help other investors. We will compare these 3 companies on 4 key metrics:

-Business model
-Automobile industry-specific metrics
-Financials
-Valuations

Let’s start.