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Momentum Monthly Fact Sheet: Dec 2020


Happy New Year 2021! Here’s to a more rewarding but hopefully less exciting new year.

We’ll publish a 2020 summary of all Capitalmind Portfolios next week. In the meantime, here’s the first of the December portfolio factsheets, a quick summary of what happened during the month.

December 2020 Monthly Update for the Capitalmind Momentum Portfolio

December Returns Update

Chart shows Capitalmind Momentum Model Portfolio returns versus the NIFTY 50 and the CNX 500. Dividends have not been considered.Momentum Monthly Fact Sheet: Dec 2020Another big month for the markets, remember when 1% up / down months were the norm? Momentum was largely in line with the broader markets with a little over 7% for December.

It has trailed the markets over the last three months, but has outperformed over the last 6 and 12 months.

Performance since inception

Chart shows performance (annualised returns, annualised volatility and maximum drawdown from peak) since inception in January 2019.

Momentum Monthly Fact Sheet: Dec 2020

Reading this chart: Returns, higher the better (obviously), Volatility: lower the better, and Maximum Drawdown: higher the better, i.e. the smallest negative value, the best possible value being zero.

The Momentum portfolio tries to outperform the NIFTY while suffering lower drawdowns in corrections.

Summary of Dec 2020

We closed out 9 positions through the month.

  • We exit 3 positions at a loss, the worst being RATNAMANI at -9%
  • The other 6 positions delivered nominal gains with TATACOMM at +8%

Chart below shows these positions on holding period (x-axis) versus returns realised (y-axis). The size of the bubble depicts the relative realised return in ₹ terms. Red bubbles were realised losses. Also note these also include positions reduced to bring their weights to within portfolio rules.

Momentum Monthly Fact Sheet: Dec 2020Open Positions

Chart shows a snapshot of open positions as of the end of December. Some of these will change in the first rebalance of 2021.

Momentum Monthly Fact Sheet: Dec 2020

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Outlook for January

January is traditionally a below average month to be in the markets with the median return being below the long-term annual return. Markets have been surging for the last couple of months, and December closed strongly. So it won’t be surprising if they take a pause this month.

Note how that statement will be valid in most cases irrespective of what the markets actually end up doing i.e. there is close to zero predictive power in opinion-based forecasts, definitely my opinions. We’ll stick to our rules and since they say stay, we’ll stay invested, for now.

We’ll also publish a 2020 summary of how all Capitalmind Premium portfolios did next week.

Other December Fact Sheets

Recent Momentum FactSheets:

November Factsheet

October Factsheet

September Factsheet

This article is for informational purposes. No stock mentioned in this post is an individual buy or sell recommendation. Momentum is a portfolio strategy that enters and exits a set of stocks based on rules. It can also be volatile in certain circumstances. Make sure to do your own diligence before investing in such a strategy.

For access to all Capitalmind Portfolios (Momentum, LT Multicap, Fixed Income, Chase), Join Capitalmind Premium.

The Capitalmind Momentum portfolio is also available on smallcase


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