Our Strategies
Moats & Special Situations Portfolio
Overview
Our Moats & Special Situations Portfolio (MSSP) is a Large-Mid long-only equity solution that was started in 2011. Its primary objective is to identify and invest in the companies which have a wide and deep sustainable competitive advantage (a Moat) over other companies in the same industry. This helps to maintain profitability and growth, adding significant economic value for shareholders over time.
Investment Process
Capital preservation is the top priority of this strategy and thus focuses on controlling risks. It therefore focusses on companies with clear and sustainable competitive advantages (Moats) and buying them at or below fair valuation. The strategy also focuses on companies which are non-moats but enjoy cost leadership or are available at deep valuation discounts as special situations. The strategy avoids unproven business models and turn around stories, and is disciplined with regards to valuation. Generally, the portfolio is invested in those companies which provide high prospective returns over the estimated cost of equity. In an environment where there are limited opportunities in the market due to overvaluation, the portfolio would hold cash. This limits the risk of permanent loss of capital and ensures superior risk adjusted returns.
Key Information
Acronym: | MSSP |
Inception Date: | January 2011 |
AUM: | ~729 Cr. |
Benchmark: | S&P BSE 500 TRI |
Number of Stocks: | ~25 |
Time Horizon: | 39 Month |
Minimum Investment: | 1.5 Cr. |
Volatility: | Low â Medium |
Portfolio Turnover: | 30%-50% |
Risk Control: | Stock 15% & Sector 30% (Max Weight) |
Hurdle Rate: | 13% |
Performance Fee: | 25% |
Why invest in the Moats & Special Situations Portfolio?
The strategy is designed to be a long term multi-generational solution that provides an above benchmark risk-adjusted return. The MSSP strategy is suitable for conservative investors who want their wealth to compound over time with limited volatility and a low risk of the permanent loss of capital.
Performance of Rs. 100 Invested at Inception
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Please check relative performance of other portfolio managers by clicking on this link
Note: The benchmark for MSSP is BSE 500 TRI Benchmark performance, calculated using Total Return Indices. The returns above are consolidated for all clients, time weighted and cashflow adjusted after all expenses including PMS management and performance fees. The actual returns of clients may differ from client to client due to different portfolio and timing of investment. Past performance is no guarantee for future performance.