20240601 DKK INR NOK SEK trades

Sell in May and Go Away?

Hi all and thanks for reading. Because I am on holiday visiting Iceland, this months Week#2 stock picks were selected as at the 1st of June 2024 and this post written in advance, rather than selected and written as on the 8th as is typical. In all other regards, the stock selection process remains the same.

There is a saying in investment circles that one should “sell in May and go away”¹, which suggests² that investors would be better off selling out of their stocks and holding cash from May to October-ish. Some possible rationales include that much of the northern hemisphere is on summer vacation and so business activity decreases, less people are trading, and so on. I myself have never been able to harness any such magical market-timing approach in my algorithmic software, and so Two Crows will continue to invest as normal, and definitely not sell out of our holdings. Two Crows strategies hold stocks for years, ideally, and market-timing or short-term trading is anathema to me. So, we will push on with our monthly stock selections as always, trying to find quality businesses with rapid growth and with a history of producing great profits.

Monthly portfolio commentary

This marks the sixth month of publishing model portfolios selected using the Two Crows Systematic scoring and selection algorithm(s) for Week#2 (DKK, INR, NOK and SEK) portfolios.

During this month’s stock selection review, I once again benefited from the practise of plotting portfolio trades in simple graphs. In the screenshot below, the INR - GM Breweries share price clearly showed a strange drop of 20% immediately from the moment of purchase. On³ investigation⁴, I confirmed that the shares recently split at the ratio of 1.25 : 1 , and could update our portfolio purchase history accordingly.

GM Breweries stock shows a weird drop, suggesting a split in share price occurred.

Another other thing that immediately stands out as worthy of inspection is that insane jump in the price of Hindustan Zinc, whereby the stock more than doubled since purchase. A quick googling confirms that yes, indeed the price has been rocketing up recently, and that no, we do not have a data integrity issue *phew*. My gut says that the price will bleed back down again, and so I am tempted to sell and lock in a high profit… however… that kind of opinion-based short-term trading goes against the systematic investment process. And who am I to say that the news that China’s agressive economy management⁵ isn’t going to translate into even bigger moves for Hindustan Steel later on? Rather than engage in gut feelings and short-term trading triggered by price moves, we stick to the process, and play for the long term.

The recent release of many Indian annual financial statements are trickling into our data feed and have triggered sales for two companies who’s returns on capital and operating margins collapsed or even turned negative. In these (hopefully rare) instances where our portfolio companies start to perform poorly, there is always the question of whether to hold, do a partial sale, or exit completely. Generally speaking, and with so many other companies available with better current business performance on offer, Two Crows strategies will exit entirely, and reinvest the proceeds in alternatives.

In most other regards, our trades this month simply add to existing positions, with only a couple of new names being added. Now, as always:

Monthly Trades for DKK, INR, NOK and SEK

DKK denominated stocks (500 000 + divs/sales)

• BUY CBRAIN.CO - cBrain A/S: 150 shares @ $304

• BUY CHEMM.CO - ChemoMetec A/S: 132 shares @ $343.6

• BUY COLO-B.CO - Coloplast A/S: 55 shares @ $827.4

• BUY DSV.CO - DSV A/S: 42 shares @ $1016

• BUY GMAB.CO - Genmab A/S: 24 shares @ $1931

• BUY NOVO-B.CO - Novo Nordisk A/S: 50 shares @ $916.9

• BUY NTG.CO - NTG Nordic Transport Group A/S: 157 shares @ $289.5

• BUY PAAL-B.CO - Per Aarsleff Holding A/S: 121 shares @ $375

• BUY RILBA.CO - Ringkjøbing Landbobank A/S: 37 shares @ $1227

• BUY RBREW.CO - Royal Unibrew A/S: 82 shares @ $556.5

• BUY SKJE.CO - Skjern Bank A/S: 221 shares @ $206

INR denominated stocks (5 000 000 + divs/sales)

• SELL BALAXI.NS - Balaxi Pharmaceuticals Limited: 4400 shares @ $131.25

• SELL RCF.BO - Rashtriya Chemicals and Fertilizers Ltd: 3429 shares @ $156.55

• BUY DRREDDY.BO - Dr. Reddy's Laboratories Ltd: 81 shares @ $5876.7

• BUY ECLERX.BO - eClerx Services Limited: 214 shares @ $2215

• BUY GMBREW.BO - G.M. Breweries Limited: 761 shares @ $623.45

• BUY GEOJITFSL.BO - Geojit Financial Services: 4794 shares @ $98.96

• BUY HCLTECH.NS - HCL Technologies Limited: 356 shares @ $1331.85

• BUY JKPAPER.BO - JK Paper Limited: 1250 shares @ $379.45

• BUY KNRCON.BO - KNR Constructions Limited: 1568 shares @ $302.55

• BUY MGL.BO - Mahanagar Gas Limited: 370 shares @ $1281

• BUY NATCOPHARM.BO - NATCO Pharma Ltd: 465 shares @ $1020.15

• BUY PERSISTENT.BO - Persistent Systems Limited: 135 shares @ $3516.05

• BUY STEELCAS.BO - Steelcast Limited: 753 shares @ $630.25

• BUY TCS.BO - Tata Consultancy Services Limited: 127 shares @ $3735.8

• BUY TCI.BO - Transport Corporation of India Ltd: 554 shares @ $856.6

• BUY VIKRAMTH.BO - Vikram Thermo (India) Limited: 2775 shares @ $170.95

NOK denominated stocks (500 000 + divs/sales)

• BUY BELCO.OL - Belships ASA: 2125 shares @ $23.95

• BUY BRG.OL - Borregaard ASA: 263 shares @ $193.8

• BUY BOUV.OL - Bouvet ASA: 783 shares @ $65

• BUY KID.OL - Kid ASA: 347 shares @ $146.8

• BUY KIT.OL - Kitron ASA: 1539 shares @ $33.06

• BUY KOG.OL - Kongsberg Gruppen ASA: 57 shares @ $890

• BUY MEDI.OL - Medistim ASA: 265 shares @ $192

• BUY MULTI.OL - Multiconsult ASA: 333 shares @ $153

• BUY NORBT.OL - Norbit ASA: 766 shares @ $66.4

• BUY PROT.OL - Protector Forsikring ASA: 214 shares @ $237.5

• BUY REACH.OL - Reach Subsea ASA: 7758 shares @ $6.56

• BUY SMCRT.OL - SmartCraft ASA: 1725 shares @ $29.5

• BUY SVEG.OL - Sparebanken Vest: 391 shares @ $130

SEK denominated stocks (500 000 + divs/sales)

• BUY ATCO-B.ST - Atlas Copco AB: 204 shares @ $170.45

• BUY BAHN-B.ST - Bahnhof AB: 705 shares @ $49.3

• BUY BIOG-B.ST - BioGaia AB: 280 shares @ $124.2

• BUY BONEX.ST - Bonesupport Holding AB: 137 shares @ $254.4

• BUY CAMX.ST - Camurus AB: 65 shares @ $538.5

• BUY EPI-B.ST - Epiroc AB: 175 shares @ $198.2

• BUY FNOX.ST - Fortnox AB: 528 shares @ $65.8

• BUY HEM.ST - Hemnet Group AB: 118 shares @ $293.6

• BUY HTRO.ST - Hexatronic Group AB: 803 shares @ $43.25

• BUY INVE-B.ST - Investor AB: 123 shares @ $282

• BUY NOTE.ST - NOTE AB: 229 shares @ $151.8

• BUY PREV-B.ST - Prevas AB: 248 shares @ $139.8

• BUY TEQ.ST - Teqnion AB: 159 shares @ $218.5

• BUY TFBANK.ST - TF Bank AB: 154 shares @ $225

• BUY TRUE-B.ST - Truecaller AB: 938 shares @ $37.04

Thanks for reading, and please feel free to get in touch if you’re interested in systematic investment and modelling.

1. https://en.wikipedia.org/wiki/Sell_in_May

2. with some evidence to support it, see the Wikipedia article above

3. https://in.investing.com/equities/g-m-breweries-ltd-historical-data-splits

4. https://www.cnbctv18.com/market/gm-breweries-q4-results-share-price-bonus-dividend-other-income-profit-revenue-19392061.htm

5. https://www.fortuneindia.com/investing/hindustan-zinc-shares-jump-19-to-record-high/116868