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Rupeeting Monthly Performance Update - April 2022

April 2022 was a bad month for equities globally. While the Indian markets were down 2% this month, the Nasdaq saw its worst month since March 2020, dropping by 13%.


Inflation has become the central gangster, with other factors either being the cause (war, supply chain disruptions) or the effect (tight monetary policy, slower growth)!


In this context, all our diversified all-weather portfolios outperformed their respective benchmarks, and so did all our equity portfolios.

Both asset allocation and stock selection have worked well for us this month.

The markets in April 2022

Stocks: While large caps were down 2% during the month, mid and small caps saw some respite and were mostly flat. This is the second consecutive month of mid and small caps outperforming large caps.

Debt: 10 year prices fell as yields rose, reflecting the tightening of monetary policy. Corporate bonds and 1-days were both flattish.

Gold: Gold continues doing well as investors turn to safety.

International stocks: The Nasdaq was hammered down by indications of Fed getting more aggressive on interest rate hikes and balance sheet offloading, US inflation sticking around its highs, growth slowing down, and several cracks appearing in tech stocks.


Rupeeting in April

During the month our Core Portfolios, which are all-weather portfolios made of 5 different asset classes, performed very well - they all outperformed all their respective benchmarks.

Some of our decisions in the last rebalance helped us gain this advantage:

  1. We added corporate bonds to the portfolio, which gave us a better yield

  2. We had moved from 10 year government bonds to 5 year, and those performed better (5Ys were down 1.1% while 10Ys were down 1.6%)

  3. We maintained exposure to Gold, which performed well

  4. We got rid of exposure to International Stocks, which had a disastrous month


Rupeeting’s Equity Portfolios too, outperformed the Nifty. Monopolies was up a staggering 6% this month. All the other portfolios too ended up outperforming the Nifty. The only one that was down a wee bit was Disruptors. Reasons for outperformance?

  1. Rocketship - Higher exposure to mid and small caps

  2. Monopolies - High exposure to defence sector (BDL, Data Patters and HAL), which all saw a massive upswing in April

  3. Bread & Butter - Appropriate placement in consumption stocks

  4. Value Migration - Higher exposure to mid and small caps


Performance in Disruptors was bogged down by the exposure to internet stocks, which have still not been picking up.


What next for the markets?

  • Inflationary pressures are expected to continue. Because of the Russia-Ukraine conflict, one after the other, either prices of commodities have shot up, or they have been in short supply.

  • 75% of the world’s supply of sunflower oil got impacted, and all other edible oil prices went off the roof. The derivative impact was realised when palm oil demand went up, and Indonesia (the world’s largest supplier of palm oil) started seeing a domestic shortage. It banned exports, and prices went further up.

  • Similarly, Europe tried reducing dependency on Russia for its gas requirements (it imports half its gas from Russia). It ended up importing coal from South Africa to substitute that, sending global prices up. It has now caused a shortage in India.

  • As inflation remains high, central banks are likely to get more aggressive on tightening monetary policy - in some or many forms.

  • Inflation and consequent monetary policy will both impact demand and growth. Corporate profits and stock valuations are both likely to get impacted, resulting in subdued markets.

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Alphaware Advisory Services Private Limited (Brand Name - Rupeeting) makes no warranties or representations, expressed or implied, on products and services offered through the platform. It accepts no liability for any damages or losses, however, caused in connection with the use of, or on the reliance of its advisory or related services. Past performance is not indicative of future returns. Please consider your investment requirements, risk tolerance, goals, time horizon, risk and reward appetite, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. Performance and returns of any investment portfolio can neither be predicted nor guaranteed. Investments in mutual funds, stocks, ETFs and any other investment products that you see Rupeeting's views being expressed on are subject to market risks. Please read all scheme related documents carefully. The content and data available in the material prepared by the company and on the website of the company, including but not limited to index value, return numbers and rationale are for information and illustration purposes only. Charts and performance numbers do not include the impact of transaction fee and other related costs. Past performance does not guarantee future returns and performances of the portfolios are subject to market risk. The information is only for consumption by the client and such material should not be redistributed. Data used for calculation of historical returns and other information is provided by exchange approved third party vendors and has neither been audited nor validated by the Company. Detailed return calculation methodology is available here. Detailed volatility calculation methodology is available here. Registration granted by SEBI, membership of BASL and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Alphaware Advisory Services Private Limited [SEBI RIA Registration No: INA000015747] [Validity of registration: February 08, 2021-Perpetual] [BASL ID: 1610] [Address: 22/A Shah Industrial Estate, Off Veera Desai Road, Andheri West, Mumbai 400053] [Principal Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Compliance Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Grievance Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Platform Partner: smallcase] [CIN – U74999MH2019PTC320573] [GST No: 27AARCA8847R1ZF] [SEBI regional address: SEBI Bhavan BKC, Plot No. C4-A, 'G' Block, Bandra-Kurla Complex, Bandra (East), Mumbai, Maharashtra, India, Pin Code – 400051.]

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