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Exponential Profits


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Exponential Profits

Exponential Profits is a service that aims to identify the most promising penny stocks based on the proprietary S.O.L.I.D system.

Exponential Profits is a stock recommendation service that aims to recommend what we are calling penny stocks - stocks that typically trade at Rs 50 or lower - with the potential to generate strong returns over 1 to 2 years.

Exponential Profits is based on our very own proprietary S.O.L.I.D framework that hunts for penny stocks with good fundamentals available at attractive valuations.

To assess the investment-worthiness of stocks, they are made to pass through the S.O.L.I.D filter. The constituents of S.O.L.I.D comprise of parameters such as the balance sheet strength of the company, its long-term growth potential, its profitability and few more.

Only those stocks that pass through the above filters are recommended in the Exponential Profits service.

What does Exponential Profits offer?

The Exponential Profits report will include stock recommendations and give subscribers suggestions on how best to use the flexibility of increasing or reducing exposure to equities based on the overall market valuations.

Who is the editor of Exponential Profits?

Rahul ShahRahul Shah, the Editor of Exponential Profits, is a research analyst and Co-Head of the Equitymaster research team. Rahul has developed some of Equitymaster's most stringent and rewarding research processes, and recommended some of the biggest winners in Equitymaster history. He firmly believes that to be successful at investing, you have to reign in your emotions, and use smart systems that give market-crushing returns.

What is the frequency of the reports and what is the minimum number of reports expected annually?

The Exponential Profits reports come out monthly, on the 30th of every month. So there would be a minimum of 12 reports a year. In situations when a good opportunity becomes available because of the market action, we may not wait for the 30th and come out with a report much earlier.

On the Exponential Profits page of our website, there will also be the status of all our recommended stocks that are currently in open position.

In addition to all the stock recommendation reports, we will also publish a detailed penny universe roundup. This will be a monthly digest published exclusively for subscribers.

How often will stocks be recommended and what will be the rate of replacement?

The frequency of recommendations really depends on how many stocks pass through our SOLID framework at a given point in time. If the number is large, there could be as many as 20-22 recommendations spread over a few months and if the number is low, there could be as low as 8-10 recommendations in a year. Overall, the number of recommendations per year should remain in the range of 8-20 stocks.

We expect the stocks to be replaced at a frequency of not less than a year barring an exception or two. However, if the fundamentals are sound and there is still scope for the stock price to go up, the stock may stay in the service even beyond one year.

How long should one hold on to a stock?

We expect a stock once recommended to be held for not less than a year. At the end of the year, the stock's fundamentals will be assessed afresh and a decision on whether to exit or stay put will then be taken. Overall, we don't expect a stock to stay in the service beyond 2-3 years.

Since we are taking a group based approach in Exponential Profits, we would like subscribers to judge the performance of the entire group over a period of 3-5 years.

The above is purely indicative and the subscribers are recommended to obtain advice from their financial planners or investment advisers.

Does the service have any capital protection measure in place? What will be the recommendation on dealing with the idle cash?

Yes. In order to stay protected from deep corrections in the markets, we undertake a yearly survey of the stock market. If the survey tells us that the broader market is expensive, we recommend subscribers exiting out of most stock positions and keeping only 25% in stocks and remaining in cash.

In situations such as the above, we will recommend that subscribers move the idle cash to safe short term fixed deposit. We will aim at providing correct guidance in this regard in the reports.

What are the expected returns?

Penny stocks do come with high risks attached and as a consequence, aren't worth the effort if one is not aiming for returns of at least 22%-25% per annum from a 3-5 year perspective.

This is going to be our endeavor as well. While the returns may not be uniform and there could be few penny stocks that lose money, overall, we are targeting returns in the ballpark of 25% from the service over a medium-term horizon.

We cannot move ahead without cautioning that these returns can't be guaranteed despite us putting in our best efforts.

Besides, since these stocks tend to be more volatile than the rest of the pack, expect few to incur sizeable losses.

Are all the recommendations expected to perform well?

No. Some may very well fall below our recommended price. However, this is all part of the game. The strategy makes allowance for such losers. We expect that in the overall scheme of things, the gains will more than make up for the losses.

How will we know when to Sell the stocks?

Through our reports, we will explicitly mention when to sell a stock.

Why do you call the stocks you recommend penny stocks? Is it the same as when other people say penny stocks?

When we say penny stocks we mean stocks that are trading for below or around Rs 50. However - do not confuse this with any other external definitions of penny stocks (such as those related to market caps, or exchange categorisations).

Are Equitymaster analysts allowed to invest in the recommended stocks?

Equitymaster is an honest, completely transparent and a professionally run organization. We have a strict compliance system, internal policies and Share Trading Guidelines in place. Please note all securities trading of our employees are tracked and monitored to ensure that our subscriber gets the first right to our paid research. We follow the SEBI (Research Analysts) Regulations and give full disclosures with respect to each recommendation. We further request our subscribers to go through our Share Trading Guidelines.

How should one contact the customer service team in case of a query?

You can write to us with all your queries and we will be delighted to assist you. Alternatively, you can call us on +91-22-61434055 between 10 am to 6 pm from Monday to Friday.

What Exponential Profits does not offer?

Exponential Profits is a generalized recommendation service. We do not offer customized opinions for any particular subscriber or class of subscribers. We are not qualified financial advisors nor Investment Advisors and we strongly recommend our subscribers seek professional advice before taking any decisions for their investments.

Where does Exponential Profits fit into the asset allocation pyramid?

asset allocation

Penny stocks are inherently riskier than blue-chip or mid cap stocks. On the brighter side, they present a huge growth potential. It is not unusual for a good penny stock to turn a multi bagger in a matter of months. But on the flipside, there is a high risk attached.

Subscribers should note that not all penny stocks tend to be outperformers. In fact, we have seen penny stocks plunge 80-90% when things turn sour. That is the reason penny stocks are not recommendable to those having a low risk profile. Even for subscribers having an appetite for slightly more risk, we recommend not more than 5%-7% of one's portfolio be invested in penny stocks. This means that the corpus that one sets aside for the Exponential Profits service should not be more than 5%-7% of the total money allocated towards equities.

What Are Exponential Profits Subscribers Saying?

I have been a member of Exponential Profit since 2017. Due to my profession’s commitment I am not very regular in tracking Ups & Down of Market but this service as promised allows me to take advantage of the Equity market with little investment of time. I find their reports made in easy to understand language and their recommendations are precise and explicit.

- Shiwesh Kumar, Chandigarh

I appreciate the recommendations under Rahul Shah's Exponential Profits. I have benefitted so far, and intend holding the stocks as per advice from Equitymaster team. I would like to thank the entire team at Equitymaster for the efforts they put in to safely recommend stocks for us and help us achieve our dreams by multiplying our hard earned savings. I wish all the team members, the very best in future recommendations in any scheme. Trust the above vote of thanks will encourage the team to strive for better selection of stocks.

- Opender Chadha, Mumbai

Congratulations. Many Thanks to Rahul Shah for giving excellent recommendations in Exponential Profits.

- Anand Chaudhary, Bangalore

Read more subscriber reviews.

How can I try Exponential Profits

Money backWe are delighted to inform you that you can try Exponential Profits completely risk free! There's a 30-day money back guarantee. So if it turns out that you don't like Exponential Profits, we'll gladly give back every rupee you paid.

Try Exponential Profits

Or Give Us a Call: +91-9136015013

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