Dalal Street Rules – Year 2012
All models are wrong, but some are useful. George Box, Statistician The year 2011 had been mildly down for MIDAS but a brutal one for the market benchmarks. Investors were quite pleased with the performance, this being a long only... Read More →
Dalal Street Rules – Year 2011
World Cup is getting hot, Dhoni hits the winning shot. Kalmadi thinks we are retards, Raja gets a "go to jail" card. Anna fasts for Lokpal, Mamata wins her first election in Bengal, S&P Downgrades US Treasuries, adds to our miseries.We... Read More →
Dalal Street Rules – Year 2010
BJP’s blown away, Manmohan has his say, CAG smells a scam, Run as fast as you can. Coal Blocks, Spectrum locked, Games can, feed the flock. In June 2009, Congress came back with a much larger seat tally than was... Read More →
Dalal Street Rules – Going Quant
Background: Efficient Market Hypothesis Vs Factor Investing Efficient Market Hypothesis (EMH) and Bill Sharpe and his Capital Asset Pricing Model (CAPM) model were the accepted framework for evaluating expected returns from stocks for almost 3 decades between 1960 and 1990.... Read More →
Dalal Street Rules
Prologue – Circa 2008 I made a mistake in presuming that the self-interest of organisations, specifically banks and others, was such that they were best capable of protecting their own shareholders. Alan Greenspan, Oct 2008, Congressional Hearing Post the Great... Read More →
Ben Graham was a Quant or Systematic Rule Based Investing
What is Quantitative Investing ? Quantitative investing attempts to reduce the investment process to its scientific and statistical core, eliminating emotional, human judgment from the equation as much as possible. This quantitative investment process is also known as systems based... Read More →
Investing in Equities: Lottery Effect
Imagine how much harder physics would be if electrons had emotions Professor Richard Feynman So why do investors buy (especially retail investors) high beta names especially with negative news around them? This is because of a phenomenon called the Lottery... Read More →
Behavior Gap
Today we are going to talk about an important concept called “Behavior Gap” and why it is so important for all investors to be aware of this. I really wish I had known this early in my career. Whenever I... Read More →
Greed and Fear – Disposition Effect
It turns out that there are specific names for the behavioural patterns that I have described in my earlier blog which you can read here. Over the next four blogs I am going to break down greed and fear into four... Read More →
Greed and Fear – Making of a Bubble
The two most basic instincts of humans from the days of Adam and Eve. Adam was greedy and got tempted by the apple. And then fearful because he knew he would have to pay for his greed. These are our... Read More →