Hello Dear Friends,
Today I will share a note on how I have transitioned over the last few months. A lot of you have been asking me over emails and WhatsApp about when I will restart onboarding clients since I am not surrendering my RA License.
When I was closing down AARD, I had issued pro-rata refunds to all applicable. But today the scenario has changed.
I thank the few people who did not let depression, defeats, and personal setbacks swallow me in the last 3-6 months, perhaps the worst time for me in securities markets and my personal life. It was very encouraging to me that in my 12+ year journey in markets, I managed to make 2-3 friends who during my darkest times in last few months spoke to me on almost a daily basis.
I am specially grateful to all the circumstances that gave me an expensive education in markets and market behavior to transition into the trader I am today.
But I have just transitioned into a trader. So, I do not want to onboard anyone yet. I want to wait for 5-6 months and build confidence in myself as a trader before I start eventually onboarding clients.
Now, continuing about today’s main topic. I earlier used to do analysis basis the following framework:
I started by understanding the business model and operational structure—how the company actually made money.
I then tried to assess the leadership’s vision and strategy, and for this I used to travel a lot.
I then used to conduct a SWOT analysis to get a clear picture of the company’s current internal position.
I then looked at the macro landscape to identify dynamic factors that could impact the business in the near term.
I then tried to pin point specific triggers that would propel the company’s vision.
I then used to analyze the financial statements and key metrics to quantitatively measure the company’s health.
Then I used to map out the competitive landscape and pinpoint the single biggest challenge the company faces.
This was a qualitative heavy approach with relying heavily on meeting the managements of any and every company.
Today, my methodology is pretty simple. I simply go with the trend.
A simple RRG analysis tells me about relative strength of sectors and their relative momentum.
I generally now only look at Top 750 names.
I remove all stocks from my framework not in Stage 2 and having a declining RS.
Then I do basic scuttlebutt. For this, today I don’t leave my home. Screener.in, MarketSmith India, and The Wrap by Tar of InvestKaroIndia are mostly the only resource I use.These three tools are mostly enough for me today to do basic scuttlebutt.
Then its basically waiting for an inflection point. Basically companies building energy within its base, and once it crosses the pivot with strong volumes, with demand overtaking supply at a confirm uptrend.
The beauty about my new approach is that I get a chance to refine it making new mistakes everyday.
Today, I am happy tracking a universe of top companies that are from the leading sectors. This allows me to balance growth and resilience. The leaders almost always stand out as sectors rotate. Today I follow a more disciplined approach and avoid everything else.
Today, rather than relying too heavily on promoter meetings, I simply rely on price volume data and objective disclosures and numbers.
I am not against meeting managements, its just something I don’t do today.
This education and transition was challenging but worth it.
A few lessons I learnt from my journey of last two years that have really helped me develop the mindset I have today:
Letting go is sometimes the most courageous decision you can make.
Growth often begins where comfort ends.
Every setback carries within it the seed of a greater comeback.
Our ultimate response to challenges shapes our legacy more than the challenges themselves.
Failure is your best friend.
Please note that I am not affiliated with any of these platforms mentioned above. Do not consider this as a solicitation of an offer to buy any of the above financial products. Not a recommendation or solicitation to buy/ sell.
Rgds,
Ayush Agrawal
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All information is sourced from publicly available data, and while every effort has been made to ensure the accuracy and reliability of the information provided in these notes from the management meeting, Ayush Agarwal Research cannot guarantee that the information is complete or free from errors.
I, Ayush Agrawal, am registered with SEBI as an Individual Research Analyst under the registration number INH000013013, effective from September 14, 2023.
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