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Aurum Capital performance note on and current view

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This is the performance note on the 2nd anniversary of Aurum Capital and current view on the market

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Aurum Capital performance note on and current view

  1. 1. Page 1 www.aurumcapital.in 03-Aug-2020 Aurum Capital annual performance note: Aug 2020 Dear Subscriber, We have completed two years of Investment Advisory Services. First of all, we would like to thank you for your continued support and confidence in our services. We also had a very high rate of renewal during this tough market scenario and we are also thankful to all our subscribers who renewed their subscription. As mentioned, these 2 years have been tough for the market. During this period, our entire focus was to remain conservative, protect capital and guide our subscribers. We went to 100% investment just about 3 months ago. We were criticised and questioned too for this extreme cautious approach. In hindsight, our conservative strategy proved to be a good approach. While being conservative, we also built a robust portfolio. We took time to build our portfolio and remain very confident of our portfolio performance in the future. We have built a portfolio with value/value + growth focus with a mix of large, mid and majority of smallcaps. The primary driver has been value with contrarian approach and in the companies with strong balance-sheets, cash-flows, corporate governance and transparent business practices. Here is the summary of our performance: Annual Performance of Aurum Capital portfolio during the last one year Index Returns from 2nd Aug 2019 to 1st Aug 2020 BSE Smallcap +4% BSE Midcap +1% Nifty 50 Flat (0%) Aurum Capital* +17% * without adding the liquid fund returns on the cash we had in our portfolio The summary of our performance from 1st Jan 2020 till 1st Aug 2020 (Year to date) Index Returns from 1st Jan 2020 to 1st Aug 2020 BSE Smallcap (-)6% BSE Midcap (-)8% Nifty 50 (-)9% Aurum Capital* +9% * without adding the liquid fund returns on the cash we had in our portfolio
  2. 2. Page 2 www.aurumcapital.in The key was whether our portfolio can bounce back, when times change. During the last one year and year to date, we have outperformed all the indices with a significant margin. We have given significantly higher returns than all indices as well as comparable Mutual Funds. While calculating our performance, we remain very conservative. We believe in our investment philosophy and in the strength of our portfolio. We just need to be patient and have conviction in our picks. We continue to focus on business and valuations. We continue to monitor companies and sectors closely. That’s the thing which is in our hands and we promise to do that with all the resources at our hand. We will continue to be guided by ethics, integrity and transparency. We strongly believe that our style of investment will do well for the next few years. Market View: We have had one of the most challenging periods, one which humanity has not seen in more than a century. CoVid19 has affected economies, businesses and all of humanity. We always believe adversity also brings opportunities. The key is to focus on companies/sectors which can survive and be beneficiaries in the long term. We have put all our energy in identifying these types of companies. We have done forensic and scuttlebutt analysis of all the companies in our portfolio. We are fairly confident that a majority of the companies in our portfolio will come out stronger from these challenging times. We need to keep a positive frame of mind and believe that humanity will overcome this challenge(s). What should investors do in these kinds of markets? 1) Patience: It’s a key attribute of a successful investor. An investor must be able to survive bear and corrective markets. As they are inevitable. 2) Positivity: A negative investor never makes money in the market. Be positive, but be realistic too. Always have a longer-term vision and horizon. 3) Discipline: An investor must be disciplined enough to invest when times are bad. And disciplined enough to take profits when times are good. We also have a contrarian and value-based approach in investing. We are not averse to looking at sectors which might be in downturn, but there are chances of them bouncing back. These are the times when valuations are supportive. This approach may involve some pain for the short or medium term as one can never time cycles to perfection, but most of the times pays handsomely in long term. Overall, we think that economy might revive in the next couple of quarters.
  3. 3. Page 3 www.aurumcapital.in A note about our performance measurement practices and recommendations: 1) Our model portfolio remains the same as displayed on the screen for all starting from the beginning. 2) We include all exits to arrive at our performance. We do not remove/hide any stocks exited by us even if we have booked any losses. 3) We take the weighted average price of the recommendation. We do not and will never take the lower price of the band while calculating buy. Similarly, we do not and will not take the upper price of the band while calculating gains for exit. This, we believe, avoids any bias for artificial gains. It rather reflects performance close to the reality. We never try to manage our performance. It is as is in black and white and mostly tilted to benefit the subscribers. 4) We have 16 companies which make 100% of our portfolio. We have a fairly diversified portfolio and are not sector heavy in any particular sector. We do put in a lot of thought in designing our portfolio from a risk angle too. 12 recommendations in Current Recommendation section, are in buy range. 4 are in hold range. 75% of our portfolio is in buy range and 25% in hold range. Please stick to asset allocation and buy discipline as advised or as per your risk profile. 5) Please always follow our detailed research and subsequent updates on the company provided under Current Recommendation section. 6) If you have any questions then you can raise them in Investor Forum section for paid subscribers. These are always responded by the founder and not outsourced to any executive. 7) If your WhatsApp number is not updated with us then please let’s know. We continue to be committed to serving you while being a part of your journey for financial freedom while doing so we will remain transparent. We are thankful to each one of you for your continued support and confidence in us. Happy Investing Regards, Investment Advisors Department, Aurum Capital SEBI registration No: INA000011024 Website: https://aurumcapital.in/services The founders’ contribution to equity investing is chronicled here. (These are not recommendations) https://aurumcapital.in/blogs/category/knowledge-series/

This is the performance note on the 2nd anniversary of Aurum Capital and current view on the market

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