00:00In the past 5 years, after 50, 31% has been running.
00:04If you've been making a little bit of 2 years,
00:07the investor has gained a good return in the market.
00:10Although you will still have a good return,
00:13when you are getting a good time.
00:15So if you've gone out for 5 years,
00:19you'll probably have a chance to get the market up,
00:23and get the returns.
00:24But you don't get so much fun than you had the hope.
00:27So the question is that when India's economy is increasing, corporate profits are increasing now and now the growth story
00:37is positive.
00:38And the stock market has made many times in the past 5 years record high.
00:42So what was this for the index to bump up and you have to keep your return returns?
00:49The question is that Nifty is only 13 companies.
00:53In 13 stocks, the weight index was approximately 33.7%.
00:59But in September 2021-August 2026, the annual return was approximately minus 0.8%.
01:08That means that Nifty is only one part of the index returns.
01:14So in this video, we will find some questions.
01:17Nifty's actual return was how much?
01:18How much of your stock has dropped its performance?
01:23IT, Banking & Consumer sectors?
01:25Why did you pressure on the IT, Banking & Consumers?
01:27And how did the active mutual funds get out-performed?
01:31This is all we will try to understand today's video.
01:34Hello and welcome!
01:35You are watching Good Returns.
01:36I am with you.
01:36I am with you.
01:37I am with you.
01:41I am with you.
01:41I am with you.
01:42I am with you.
01:43I am with you.
01:43You can tell me.
01:43September 2021-August 2026, Nifty 50-Niveau, 7.1% annual return.
01:51Annualised return is meant to be the total 5-year performance total.
01:57So, the return is about 7.1% per 30 years.
02:03Now, in this period, Nifty's 13 companies have collected about minus 0.8% annualized return.
02:11So, the average performance of these stocks is flat.
02:15However, the most interesting part of this story is that if these 13 laggard stocks
02:21go out of the calculation, then Nifty's return is about 11% annualized.
02:27So, the problem was not that there was no opportunities in market.
02:31The problem was that in the big part of the index,
02:34some heavyweight stocks performed well.
02:38So, one basic concept is very important.
02:40Nifty's equal weight index is not equal.
02:43This means that every company's contribution is equal.
02:47Nifty's free float market capitalization of weighted index is a weighted index.
02:52This company's market size and free float is more than the weight of the index.
02:59Now, if any stock's weight is 8% of a stock,
03:03and that stock is less than 5 years.
03:05So, where will the impact of that stock?
03:08The weight is only 1%.
03:10This is the reason that Nifty's small and mid-size stocks will be good.
03:17Then, if there are big stocks,
03:20then headline index returns will be limited.
03:23This period, 13 stocks combined weight is about 33.7%
03:27This is the reason that Nifty's small production has become a big drag.
03:32These stocks are the biggest index of heavyweight stocks.
03:36If we keep their names on screen,
03:40then you may be shocked.
03:42Let's go ahead and tell us who are the heavyweight stocks.
03:45First, HDFC Bank.
03:47Second, Reliance Industries.
03:49Third, IT industry's biggest companies.
03:52It's a big company.
03:54In forces.
03:55Kotak Mahindra Bank is the fourth number,
03:57and TCS is the fifth number.
03:59In five companies combined weight,
04:01it's about 27%.
04:03Now, if you think about index,
04:05if the return returns are so large,
04:07then the other companies' good production
04:09will not be very high.
04:13Now, let's see,
04:14one more thing is clear.
04:15These companies' problems are not just like this.
04:17Some of the margin pressure,
04:19some of the growth concerns,
04:20some of the valuation and competition,
04:22but for the index,
04:24the result is one thing.
04:26It's a small contribution.
04:27Now, let's talk about IT sector.
04:30In forces,
04:31if we look at the performance last 5 years,
04:33it's negative 41%.
04:35TCS has been negative 46% in the past 5 years.
04:40In HCL Technologies,
04:41in the past 5 years,
04:42a negative negative return in the past 5 years.
04:46In Tech Mahindra,
04:47a positive return in the past 5 years,
04:50it was a negative return.
04:53But in the past 5 years,
04:55it was a negative return in the past 5 years.
04:58In the past 5 years,
04:59the combined weight was around 8,5%.
05:03In the past 5 years,
05:06it was a negative return in the past 5 years.
05:09Discritionary IT Projects and Postpone Transformation Projects.
05:15This is the new Pressure of Artificial Intelligence.
05:19The traditional IT services model is based on companies and engineers' working hours.
05:25Broadly, it is called the Billable Hours Model,
05:27but AI tools can increase productivity.
05:31One employee can do more code, documentation or analysis.
05:35In this case, investors have a question.
05:38If the client has the same output,
05:40it will get less people and less hours,
05:45then what will the impact of IT companies' revenue and margins?
05:49There will be opportunities for AI and IT companies,
05:52but the market has seen the risk in short term.
05:55This has been added to the value of IT and growth expectations.
06:00And because of IT companies,
06:02they have a very important weight,
06:05the sector's loss of index returns.
06:08Now, let's talk about banking and financial stocks.
06:13HDFC Bank is a big heavy weight.
06:16But in the past 5 years,
06:18it has a negative 7% of the return.
06:21HDFC Limited,
06:22with the merger after the bank,
06:24the size of the size of the bank,
06:25but in the transition during the period,
06:26margins and deposit growth,
06:28the investors' questions of interest.
06:30Merger after the balance sheet integration,
06:33deposit mobilization,
06:34and cost of funds,
06:35the factors of market,
06:37the cost of funds.
06:38When the bank has a big profitability
06:40or the margins,
06:41the uncertainty of uncertainty,
06:42the stock price will be long.
06:45And here, we have to see HDFC Bank.
06:48In other words,
06:50Kotick Mahindra Bank,
06:51the stock stocks,
06:52have not supported the index
06:53as much as possible.
06:56In the past 5 years,
06:58Kotick Mahindra Bank has a positive return
07:00of 2%.
07:02Financial stocks' weight is quite large.
07:06So, the banking sector,
07:07there is also a big impact on benchmark.
07:10The performance of the market is a big impact.
07:12The performance of the market is a big impact on the big sectors.
07:14If banking and IT both are less than the same,
07:17the index return will naturally be above.
07:21Now, we talk about consumer companies.
07:24So, first of all,
07:25the name is Hindustan Unilever.
07:27Negative return is the last 5 years,
07:2929% of the return.
07:31If we talk about Asian Paints,
07:32then equally,
07:345 years, 29% of the return.
07:36In FMCG companies,
07:38rising input cost
07:39and increased competition
07:41.
07:42That means,
07:42the competition has added
07:44both companies to pressure.
07:46For FMCG companies,
07:48the raw material price is very important.
07:50If the input cost is increased,
07:52and the company doesn't increase the price,
07:54then it has affected the margins.
07:56Secondly,
07:56In other words,
07:57the market share
07:59to make the market share
07:59for companies,
08:00discount,
08:01promotion,
08:02and higher advertising
08:04.
08:07Now, Asian Paints
08:08like businesses,
08:09also,
08:09competitive intensity
08:11and demand conditions
08:13.
08:14.
08:15That means,
08:15the consumer sector is
08:16defensive,
08:17but it doesn't mean
08:19that,
08:20in every phase,
08:21consumer stocks
08:22will be outperform.
08:23When growth is increased,
08:24the cost is increased,
08:25and the competition is increased.
08:26So,
08:27the consumer stocks
08:28will become a drag
08:29.
08:32Now,
08:33one more question.
08:34If Nifty
08:34was too small,
08:35then,
08:36some active mutual funds
08:37have better return
08:38.
08:39The answer is,
08:40that,
08:40these funds
08:41have increased exposure
08:44.
08:45Analyst reports
08:46.
08:46Typical active schemes
08:48have
08:48about 15-22%
08:51portfolio allocation
08:52.
08:53In other words,
08:54Nifty
08:54combined rate
08:56was 34%
08:57.
08:58Active funds
08:59have not avoided
09:00these small stocks
09:00,
09:02,
09:02but,
09:02index
09:03.
09:05This
09:07.
09:09Now,
09:10exposure
09:11.
09:11.
09:11.
09:11.
09:11.
09:11.
09:11.
09:13.
09:13.
09:14.
09:14.
09:14.
09:15.
09:16.
09:16But here there is a lot of money.
09:18Active funds' better production is just because of stock selection.
09:21Its sector allocation, cash holding, mid-cap exposure and portfolio concentration
09:27also looks like this.
09:29Now you will ask, what does this mean?
09:32Index investing is bad?
09:34No.
09:35This analysis doesn't mean that the investment is wrong.
09:39Or the active mutual funds will always beat the index.
09:42The index is investing.
09:43Like low cost, diversification, transparency,
09:47small portfolio chunks, individual stock selection risk will be reduced.
09:53But in the return market, every stock is not the average return.
09:57Here, some big stocks and sectors of performance is heavily influenced.
10:02Return.
10:03If you invest in the index fund,
10:06you automatically invest in those heavyweight stocks.
10:08So you also invest in the index fund.
10:12You also invest in the index fund.
10:12So you also invest in the index fund.
10:13So you want to check the index fund.
10:14There is an increase of sector concentration.
10:18And the top 10 stocks combined weight.
10:20The other way, the fund manager can underrate the active funds, but with higher expense ratio, manager risk, and inconsistent
10:30performance.
10:32This is why your decision should not be seen as past returns.
10:37For investors, there are three big things in this video.
10:41First, the headline index returns, the whole market story does not come.
10:45Nifty 7.1% annualized is increased, but the stock performance is very different.
10:52Second, the stock weightage is very minor.
10:56If a big heavyweight has been reduced, it can offset some small stocks' good returns.
11:02Third, the outperformance of active funds depends on the market cycle.
11:07If the active fund has been reduced in the right time, it will have been reduced.
11:13But in the next cycle, this is not the same strategy.
11:16So, in the past five years, Nifty's story is not just 7.1% return.
11:22The actual story is that the index has approximately 1% higher.
11:24is the high-risk stocks' high, and the stocks have more than 0.1% return.
11:29Also, banking, IT, consumer, and energy, such as big sectors' stocks are more than 5%.
11:33If these stocks are not small, then, the return of Nifty's offer is around 11% annualized.
11:39So, the next time, if you see the return of Nifty's number,
11:54In this video, let us know that the numbers will be very volatile and volatile stocks will be very necessary.
12:04So, before we start, financial advisor will be very necessary.
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