Performance Review: 16/01/2021.

It looks like the correction is around the corner!

Nifty after consecutively rising for 10 out of the past 11 weeks looks exhausted! Although Nifty has ended positive for the week by 0.6% at 14433.7, it has traced out a ‘Shooting Star’ candlestick pattern which suggests an intermediate top if we follow through this week’s lows.

How far can we correct?

Well, calling tops in a bullish environment is a futile as well as fatal exercise. But looking at the structure of the chart, we can at best guestimate that we are likely to correct up to the 13800-14k zone.

Whether markets corrects or not, we are prepared!

I had already raised around 20% cash of the portfolio at the beginning of the month. The cash can provide a little bit of cushion if the markets were to turn southwards.

Going forward the risk of the portfolio is reduced by 20% but so is the return potential. But I am okay with that. I want to play conservative and keep what I have earned 😉

So where does the Hybrid Model portfolio stand?

Here’s the real-time snapshot of the actual 10 stock model portfolio established based on the DYR Hybrid Strategy. The Hybrid Strategy is the combination of Dual Momentum Monthly Rotational Strategy and Mean Reversion Long/Short strategies applied together.

Equity at the end of the week stands at Rs. 19,73,001.53 (A+B) which is down around 1.76% from the previous week. Overall returns since 30/06/2020 on an initial stake of Rs. 13,80,000 stands strong at 42.97%.

The negative cash balance that you see is because of a few open mean-reversion long positions. As the markets correct, we will have more opportunities to take advantage of short-term extremes.

Let’s see how the portfolio performs going forward.

Have a great weekend!

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