Algo Trading in India |
  • September 10, 2019
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I came across this question in Quora.

I really love such questions, as it involves lot of data crunching activity and at the end I really find some Gems or I end up learning something.

The question asked was to find the stocks that has consistently delivered 10% returns at least every year for last 10 to 15 years, so we are not suppose to find the stocks that has ROCE? — ?Average Return on capital employed for last 10 years > 10. There will be many such stocks, but we need to find the stocks that has Rate of change of 10% minimum on year on year basis for last 10 to 15 years.

I maintain a database of 22 years of historical data for Indian Markets, so I just wrote a small code to find the ROC for all stocks listed in NSE/BSE. The total list was more than 2250 stocks.

From this list, I added a filter to get stocks that has been trading actively since 2003 to till date and the final list was 441 stocks.

There were not even a single stock that has given year on year positive results of > 10% for last 10 to 15 years.

From this list now I need to find out stocks which has given consistent returns every year, where we can consider negative returns once in a while but it should crash or provide greater downside fluctuations. So I calculated the average returns of the stock for last 15 years and calculation their Standard Deviation which would help me figure out the stocks that are least volatile in nature and are also consistent in returns.

The listed below are the top stocks that satisfies our condition.

  1. ITC
  2. CIPLA
  3. GLAXO
  6. HDFC BANK (only stock from Financial services)

ITC tops the list with consistent returns for last 15 years with only two years marginal negative returns. FMCG and PHARMA are the sectors that has done consistently well for the last 15 years.

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