JainMatrix MidCap Portfolio outperforms by 50%


Date: 12th June 2014

JainMatrix Investments launched its Mid Cap portfolio in Feb 2013. This is the fourth update report on this portfolio, along with a brief investment note.

(Since our portfolio can only be shared with Subscribers, here is the rest of this report). 

JainMatrix Investments presents the June 2014 update of its Mid Cap Model Portfolio.

  • Post elections, the investment climate looks self-assured, with smart positive moves and an air of confidence. Investors are approving the initial noises from the new government, and awaiting with anticipation the budget due second week of July.
  • Early in 2014, the Indian indices were at all-time highs, but could be split logically into two groups.
    • One set of sectors that appreciated manifold from 2008 levels. This includes IT, FMCG, auto & auto ancillaries, banks, NBFCs and pharmaceuticals.
    • The other set of sectors were at a mere fraction or below the 2008 levels, like realty, capital goods, infra, engineering, power, telecom, metals and Oil & Gas.
  • In the past few months, we are seeing a rebalancing of investment funds from the overvalued first group to the undervalued second. This is because the outlook for the economy is now quite positive. All sectors should do well, but from a valuation point of view, there was an imbalance, and so this was inevitable. Plus the new govt’s first task has to be to resurrect the damaged sectors of the second group, which are also crucial enabling sectors for GDP growth.
  • In a similar fashion, while the large Caps were positive in this period, the undervalued Mid and Small-Caps saw a big appreciation, also called a mean reversion.
  • The INR/USD strengthened to 58.6 because of high FII/NRI funds inflow before coming to today’s 59.3
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  • Theme: The investment theme for now is – exports, infrastructure and rural/semi urban consumption. The investor should continue his wealth building process with Mid and Small-Caps.
  • Performance: In a very positive environment, the portfolio performed extremely well. On average the 7 Buy recommendation shares were up by absolute 95% and annualized 132%. But including the one Hold, the portfolio gained by absolute 82% and annualized 115% (over a period of 16 months).
  • The CNX & BSE MidCap were up by 31% & 32% absolute in the period.
  • The JainMatrix Investments Mid/Small cap portfolio outperformed these benchmarks by 50%.
  • There are now 7 shares in this portfolio that are BUY recommendations and two Hold.
  • Investors need to continue to invest in these shares in a SIP mode.

The rest of this report is shared with only current subscribers. 

Some previous updates for this Portfolio

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This document has been prepared by JainMatrix Investments Bangalore (JM), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. It should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JM has not independently verified the accuracy or completeness of the same. Neither JM nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Recipients of this report should be aware that past performance is not necessarily a guide to future performance and value of investments can go down as well. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from an independent Financial Expert/Advisor. Either JM or its affiliates or its directors or its employees or its representatives or its clients or their relatives may have position(s), make market, act as principal or engage in transactions of securities of companies referred to in this report and they may have used the research material prior to publication. Any questions should be directed to the director of JainMatrix Investments at punit.jain@jainmatrix.com


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