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Edge Model Portfolio: up to 30 stocks that beat their index, the market and cash

A rules-based model portfolio. It holds stocks only from indices that are beating both Nifty 500 and a liquid ETF, picks the stocks inside them with the widest edge over their own index, the market and cash, and moves fully into liquid ETF units when the broad market is losing to cash.

How the portfolio runs

1
Pick the indices
Of 35 Nifty sector, theme, size and strategy indices, keep only those beating both Nifty 500 and the liquid ETF benchmark over 3 months.

2
Rank the stocks
Inside those indices, rank stocks by edge: 3-month return minus the highest of their index, Nifty 500 and cash. Hold up to 30, each starting at one-thirtieth of the portfolio.

3
Rebalance every two weeks
On alternate Mondays around 12 noon. A stock is exited only when it drops out of the top 45, which keeps trading and costs low.

4
Market switch
When Nifty 500 and Nifty Smallcap 250 have both returned less than a liquid ETF over 3 months, the whole portfolio moves to liquid ETF units until one of them recovers.

How the rules were tested

Period: 31 December 2020 to 30 October 2026, including strong and weak years for small and midcaps.
Honest member lists: each date uses the index members actually in force then, rebuilt from 143 NSE Indices change notices, so no stock is bought before it joined an index.
Real costs: 0.25% on every buy and sell for taxes, charges and slippage, plus ₹999 a month brokerage; idle money earns the Nifty 1D Rate less 0.2% a year.
Robustness: 192 combinations of rebalance frequency, number of stocks, sell rule and return period were tested; the chosen rules were the ones that held up in both 2021–24 and 2025–26, on both weeks of the two-week cycle.

Backtest results (hypothetical)

₹10 lakh following the rule, compared with buying and holding Nifty Smallcap 250 or Nifty 500.

Model rule29.6%a year · ₹10L to ₹45.4L · worst fall −19%

Nifty Smallcap 25019.0%a year · ₹10L to ₹27.6L · worst fall −27%

Nifty 50011.7%a year · ₹10L to ₹19.0L · worst fall −19%

Model ruleNifty Smallcap 250Nifty 500

Year by year

Year	Model rule	Nifty Smallcap 250	Nifty 500
2021	+59.8%	+61.9%	+30.2%
2022	−2.1%	−3.6%	+3.0%
2023	+64.5%	+48.1%	+25.8%
2024	+28.7%	+26.4%	+15.2%
2025	+12.0%	−6.0%	+6.7%
2026 (to 30 Oct)	+22.2%	+0.5%	−8.3%

Before tax. The rule held liquid ETF units about 30% of the time. Index figures are price returns without dividends. A backtest applies rules to past data with hindsight about which rules to test; it is not a record of real trading, and the rule was chosen after testing several variations on the same period. Future returns may be much lower, and the model can lose money.

These are backtest results: the rules applied to past data, not a record of real trading. The live portfolio’s results will be reported to PaRRVA (the Past Risk and Return Verification Agency under SEBI’s framework), and verified figures will be shown here once available.

What subscribers get

The portfolio
Every stock with its weight, entry date and price, and the share held in liquid ETF units.

Rebalance alerts
An email on alternate Mondays around 12 noon with the exits and additions and live prices.

Full history
Every past rebalance, the market switch reading at each, and the portfolio’s track record since launch.

This is a model portfolio that follows a fixed rule. It is not advice tailored to your finances, goals or risk tolerance. WhatsApp alerts are planned.

Disclaimer. Vishal Trehan, SEBI Registered Research Analyst, Reg. No. INH000016816. The Edge Model Portfolio is research distributed to subscribers and follows a fixed, published rule; it is not personalised investment advice. Backtests apply rules to past data and are not a record of actual trading. Past performance does not indicate future results. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Regulatory disclosures: vishaltrehan.in/regulatorydisclosures.html.