Awesome last quarter!

July-12	-0.43	-0.9	0.52
August-12	-2.70	0.6	(3.27)
September-12	5.03	8.5	(3.43)
October-12	0.16	-1.5	1.62
Novemb-12	6.16	4.6	1.54

The above are returns generated versus markets and the last column is outperformance. So you can see that OCtober and November have been pretty decent months for the portfolio. So what made it run? Unlike popular expectation that high beta has made big money in this recent stock market rally, my portfolio shows the opposite. Max alpha gainers were Power Grid (a beta of 0.5 or 0.6) with 25%+ alpha, Titan Industries with same alpha (later exited stock once it reached our fair value near 300), Cipla, Nestle etc. Only Ashok Leyland was a notable alpha pick.

So what does this denote? For the longer run, what matters is company fundamentals and business model. After all, beta is a mere co relation statistic bit, nothing to denote fundamentals. Companies who have been efficient capital allocators, have wide moats, superior return on capital employed and stellar management have gained in the last one year and more. Cipla, Nestle, Titan, HDFC, HDFC Bank, M&M are all examples of quality which has held in good stead during trying times. Moral of the story? Hold on to quality. BTW, V Guard continues to go great guns and investors would do well to hold on to the stock even though it has quadrupled from sub 100 to 400 levels. Seems to be another TTK in the making!