As per current understanding of the SEBI Research Analyst regulations, we have adopted a ‘Rating’ system for stocks recommended in our strategies.

Typically, a stock will be divided into three ratings – BUY, HOLD or SELL.

(1) A BUY rating implies that stock can be bought by subscribers given the valuation comfort and technical ranges. A stock is initiated in the coverage with Initiating Price (IP). It is likely that a subscriber coming on board will not get this exact IP. Stock may be lower or higher than the IP. In this case, subscriber should use the Rating system to implement a BUY position in the stock.

A BUY rated stock can be changed into HOLD or SELL rating as deemed suitable.

(2) A HOLD rating implies that investors who already have position in a stock should not add further allocation to the stock. Investors who do not have position should not add any fresh allocation to the stock. This may be due to excessive rise in valuations or an event where we anticipate time or price or both types of correction. Given the opportunity cost, we would like to delay the buying decision for both existing/new investors.

A HOLD rated stock can be changed into BUY or SELL rating as deemed suitable.

(3) A SELL rating implies that investors who have existing positions in a stock should exit the stock fully. It means stock is dropped out of coverage and no further buying is recommended.

A SELL rated stock CANNOT be changed into BUY or HOLD rating.

Stock Rating should be used in conjugation with the Percentile system. Any subscriber to FC strategies will be able to see both Rating and Percentile against a recommended stock.

In rare situations, we will use ‘Rating under review’ category where we need more time to make a decision on the rating. This is likely to happen in an emergency type of corporate situation.