Qode Growth Fund's Resilience: How Disciplined Strategy Led to 14% Outperformance in Volatile Markets

The Indian stock market witnessed a challenging period in Q4FY26, marked by a substantial sell-off that tested many investment strategies. Amidst this volatility, the Qode Growth Fund managed to stand out, demonstrating remarkable resilience and delivering a robust performance that surpassed its benchmark by an impressive 14 percentage points.

Rishabh Nahar, the fund manager, attributes this stellar outperformance to a meticulously crafted and disciplined investment approach. The core of their strategy hinges on a combination of fundamental analysis, focusing on quality and value investing. This involves identifying companies with strong fundamentals, sustainable business models, and attractive valuations, aiming to build a portfolio of high-conviction stocks.

Crucially, this fundamental approach is complemented by a systematic derivatives overlay. This tactical use of derivatives, such as futures and options, acts as a sophisticated risk management tool. By strategically deploying derivatives, the fund was able to effectively limit downside risks and protect capital during the intense market correction. This dual strategy allowed Qode Growth Fund to not only weather the storm but also capitalise on opportunities that emerged from the market downturn.

Nahar's emphasis on a disciplined and systematic framework, integrating both bottom-up stock selection with top-down risk mitigation through derivatives, proved to be a powerful combination. It highlights the importance of a well-rounded strategy that can adapt to varying market conditions, especially during periods of heightened uncertainty and sell-offs.

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