85%

-22%

107%63%

Long Short Gross Net

Equity exposure

After three consecutive quarters of strong earnings upgrade, Q1FY22 took a pause and aligned with

elevated expectations. However, sectors barring Metals and IT saw downgrades across Auto, FMCG,

and Pharma.

We also saw the broader markets correct from their peak, with the BSE Midcap and Smallcap indices

underperforming to deliver 3.3% and 0.5%, respectively. Additionally, taper fears are getting more real

with every passing day.

Therefore, we maintained a highly defensive stance and ran a low net long portfolio along with

structured hedges to limit any potential downside due to the upcoming FED meeting. With this

positioning, we ended the month up 2.9%.

We continued to add banking names to our portfolio mainly due to their relative underperformance and

also reasonable valuation. We increased our weight to the domestic pharma theme, which outperformed

the entire sector by a wide margin.

With the Covid scare behind us and most sectors looking to open up, we bought into few sector leaders

like airlines and alco-bev, likely to benefit from this pent-up demand rage during the festive season.

We have added the required index hedges to protect the portfolio due to the heavy long retail and HNI

positioning in single stock futures.

Fund/ Benchmark 1 Month 2 Month 3 MonthSince

inception

EDGE 2.92% 4.60% 5.43% 12.63%

Nifty 5 0 TRI 8.74% 9.22% 10.46% 17.85%

How we performed NAV as of 31st Aug ’21: 11.2633

Returns are for A1 class, net of management fees and expenses, gross of performance fees and taxes. Fund inception date: 5th Apr’21

A look at our portfolio

Exposure excludes investment in mutual funds and other securities for margin or temporary deployment of surplus funds

EDELWEISS DYNAMIC GROWTH EQUITY [EDGE] FUND – AUGUST’21

Click here for an audible synopsis of the month by our Fund Managers

August saw the fastest 1k+ point surge in Nifty, which helped it cruise over the 17k mark. Five stocks

contributed to 60% of this rally - RIL, HDFC twins, HUL, TCS and Infosys.

Post the Q1FY22 results season, which saw upgrades in the Metals and Cement sectors, compensating for

the sharp downgrades in the Auto, Pharma & NBFC sectors.; aggregate Nifty FY22E/ FY23E EPS estimates

have remained unchanged.

The Chinese PMI data came in pretty soft for August at 47.5 vs the consensus of 52, down from 53.3 last

month due to lockdowns. On the other side of the globe, the housing starts data has also softened

significantly. We believe rising Covid cases in the US and the slowing Chinese economy pose a risk to global

growth estimates – necessitating a close watch.

The Fed continues to drive most of the global gains as investors celebrate Powell's dovish tone at Jackson

Hole. Although there are clear signs of the just right 'Goldilocks' period of peak earnings growth, liquidity,

and lower rates behind us, global markets have conveniently changed the narrative to their advantage.

Exposures are % of Total NAV; notional values for derivatives (including options) considered here

Top Five Stock Holdings

Quantitative

Indicators

Annualized

Volati l ity

Sharpe

RatioBeta

EDGE 6.17% 4.37 0.37

Nifty 5 0 TRI 12.32% 3.23 1

How we fared on the risk front

Our take on the month that was

ITC: We believe it's time for the market to accurately

value the growing, profitable FMCG business. And

any potential value unlocking could be an

additional trigger.

Bharti Airtel: Industry consolidation, improving

pricing scenario, and peak leverage give us comfort

for the next leg of growth and re-rating.

HDFC LTD: Valuation below 2x FY23 book, impeccable

asset quality and recovering real estate sector will

drive above-average growth.

HDFC Bank: Acceleration in growth post-Covid and

substantial liability franchise bodes well for

sustainable earnings growth.

5.0%

4.7%

4.4%

4.4%

3.8%

ITC

Bharti Airtel

HDFC

Just Dial

HDFC Bank

Fund type Open ended Category III AIF

Fund Managers Ajay Vora & Nikhil Ranka

Minimum Investment INR 1 Cr

Subscription 15th and last working day of every month

Redemption Last working day of every month

Placement Fee Upto 2%

Management Fee (p.a. on average AUM)

Performance Fee Classes Fixed Fee Classes

A1 A2 A3 A5 B1 B2 B5

1.75% 1.50% 1.00% 1.00% 2.25% 2.00% 1.75%

1-5 Cr 5-10 Cr 10-25 Cr 25 Cr + 1-5 Cr 5-10 Cr 10 Cr +

Performance Fee 15% for class A1, A2, A3 | 12.5% for Class A5 (No catch up)

Hurdle Rate 10% pre-tax, post expenses with high water mark

Exit Load 1 % for exit between 0-12 months

Fund Expenses At actuals, capped at 35 bps

Custodian Edelweiss Capital Services Limited

Disclaimer: Edelweiss Dynamic Growth Equity Fund ("the scheme") is Category III Alternative Investment Fund – a scheme of Edelweiss Alternative Strategies Trust having SEBI Registration Number -

IN/AIF3/20-21/0857. Past performance is not an indication of future performance. Investments in the Securities Market are subject to Market Risk. Please read the Private Placement Memorandum (PPM) and

Scheme related documents carefully before investing. For a detailed Disclaimer, please click here

1Consistent returns across market cycles 2

Lock-in returns at regular intervals 3

Limit drawdownsduring extremevolatility

Objectives we’re striving towards

Fund Terms

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AIF Benchmark indices as per benchmarking agency CRISIL – Not Applicable. The Scheme has not completed one year since its inception