More from @saxena_puru

Puru Saxena

Feb 7

Another day of relative strength in growth land -

Got trolled for being cautious in late 2021 and recently, got trolled for suggesting that growth stocks might show relative strength and bottom before the indices!

Not sure whether growth stocks have bottomed or not but they are showing relative strength.

Weekly DCA way to go!

As the economy slows down in H1 2022, the recurring revenue companies with durable growth are likely to shine again...

When the near-term prospects of most businesses become murky, investors should flock to the safety and predictability of the recurring revenue compounders.

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Puru Saxena

@saxena_puru

Feb 6

The bounce off the recent lows appears to be a relief rally within an ongoing bear-market.

Liquidity conditions, rising rates and valuations suggest ~15% decline in $SPX before hitting *the* low.

It'll be interesting to see if beaten down growth stocks show relative strength.

The reason I've scaled into growth stocks is because they've already declined 50-80% and their valuations have become either cheap or fair; thus conceivable they might bottom before the indices.

In any event, my exposure is hedged via $ARKK short + am also short index futures.

If the indices decline (likely) and growth stocks get caught in the selling, my $ARKK short/hedge will defend my capital and my index futures shorts will generate profits.

If the indices and $ARKK rally, my stops will get hit with small losses and my portfolio will be long.

Read 4 tweets

Puru Saxena

@saxena_puru

Feb 4

Portfolio snapshot -

Long - $ADYEY $AFRM $AMPL $CFLT $DDOG
$DLO $GLBE $GTLB $LILM $MELI $MNDY $OKTA
$S $SE $SNOW $SOFI $TOST $TWLO $U $ZI

Short - $ARKK #RTY_F

After raising cash at start of Dec, am now done re-investing. Portfolio is hedged via $ARKK + net short via #RTY_F.

Secular growth stocks have already been murdered!

Most are down 50-75% from their ATHs and even $ARKK declined by 60% from its ATH and gave back all of its post-COVID gains (this, despite the fact that the underlying companies grew rapidly in 2020/2021).

Cont...

In January, $ARKK bottomed at $64 and then tested that low a few days later.

After the recent rally, current pullback has found support *above* last month's lows. Base formation seems to have begun and the crash is in the rear view mirror. This is time to scale in and buy fear.

Read 4 tweets

Puru Saxena

@saxena_puru

Feb 4

Secular growth stocks showing strength, most consolidating above last month's lows.

They peaked before the indices, probable they'll also bottom out before the broad market.

After 50-80% declines between Nov-Jan, the crash is behind us. DCA over next 5-6 weeks should work.

The indices are still vulnerable to a final leg down which will likely also affect the growth stocks.

This is why weekly buying over the next 5-6 weeks is probably the safer option. As soon as the Fed backs away or gives clarity, these secular growth stocks will take off.

To those who are chirping, my message has been clear for weeks -

Growth stocks peaked before the indices, likely they'll bottom before the indices or at least start showing relative strength.

Broad market (which is still ~10% below ATH) remains vulnerable to a final flush.

Read 5 tweets

Puru Saxena

@saxena_puru

Feb 1

1)Portfolio Jan-end -

$ADYEY $AFRM $CFLT $DDOG $DLO $GLBE $GTLB $LILM $LSPD $MELI $MNDY $OKTA $S $SE $SOFI $SNOW $TOST $TWLO $U $ZI

Return since 1 Sept '16 -

Portfolio +641.57% (44.73%pa)
$ACWI +71.89% (10.51%pa)
$SPX +108.00% (14.47%pa)

Contd...

2) YTD return (2022)-

Portfolio (-)4.18%
$ACWI (-)4.96%
$SPX (-)5.26%

Biggest positions -

1) $DDOG 2) $CFLT 3) $ZI 4) $GTLB 5) $MELI

Contd....

3) Commentary -

January was tough for stocks and it was especially brutal for growth stocks!

Before the month-end rally, $ARKK was down ~30% from the start of the year and both $ACWI and $SPX were down ~10%. The rally over the past couple of trading sessions eased some pain...

Read 9 tweets

Puru Saxena

@saxena_puru

Jan 10

Several high growth stocks have come back down to their pre-COVID multiples -

$LSPD $MELI $OKTA $SE $TWLO to name a few...

The e-commerce, payments, software companies got shot first, so will they also bottom out before the indices? Jury still out, time will tell.

Noteworthy SPACs peaked about a year ago and the majority of the growth stocks peaked in early November.

At today's low, $ARKK was off 50% from its ATH...

Its pre-COVID peak two years ago was $60 and today it touched $80....just $20 or 33% gain in ~2 years!....

Over the past two years, ARKK's underlying companies have grown a fair bit, so 33% gain in approximately 2 years is not a stretch....

Impossible to time the low, but can't help but think bulk of the selling in the high growth stocks probably in the rear-view mirror. We'll see...

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