Quality + Value Portfolio
The long-term compounder framework — Buffett applied to NSE
The stack
3 screeners stacked together
Why this stack works
The single highest-return investment framework in equities — popularised by Buffett, applied successfully in Indian markets by managers like Saurabh Mukherjea. Quality alone is expensive (you pay full price for known quality). Value alone is risky (cheap stocks are often cheap for a reason). Quality + Value together is the sweet spot.
Entry rules
- 1Run the Undervalued list, then filter to Quality Scorecard ≥ 7 only.
- 2On the filtered list, sort by ROCE — prefer 15%+.
- 3Check D/E ratio per candidate — skip anything above 1 unless it's a regulated business (banks, utilities).
- 4Avoid stocks within 30 days of earnings announcements — quality companies often dip on guidance updates.
- 5Build positions over 3–6 weeks, not in one trade — spread out entry risk.
Stop-loss
For long-term positions: only exit on fundamental deterioration (Quality Scorecard falling below 5 or D/E exceeding 1.5), NOT on price action.
Target
Hold for the business cycle. Review quarterly; rebalance annually. Expect 12–18% CAGR on a well-built portfolio over 5+ years.
When this fails
- You panic-sell on a 20% drawdown — these trades are designed to hold through volatility.
- You concentrate too much in one sector (no more than 25% in any single sector).
- You over-trade — touching the portfolio weekly destroys the framework's edge.
FAQs
12–18 stocks across at least 6 sectors. Fewer than 10 = too concentrated; more than 25 = diluted returns + impossible to track properly.