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Commentary | Portfolio Yoga - Part 25

Category: Commentary

Trading with the Longer Trend 2

Trading with the Longer Trend

One of the often quoted things is that one should always trade with the higher trend. So, if the higher trend is bullish, it makes sense to avoid shorts and take only longs and vice versa. As much as the advise seems great theoretically, its only after testing can we really be sure whether such a strategy really makes economic...

Permanent loss of Capital 3

Permanent loss of Capital

One of the often quoted reason to invest in the stock market is that they have delivered XX% returns since 1979. This of course is bullshit given the fact that Sensex did not even exist in 1979, let alone a retail investor have the avenue to invest in its constituents. And then there is the tales of how investing just...

Selection Bias in Mutual Fund 0

Selection Bias in Mutual Fund

When we are told that Mutual Funds beat Benchmark & hence generate Alpha, we are given the list of funds that have achieved that landmark. What we aren’t shown is the list of funds that have under-performed (who wants to highlight losers anyway) as also how 2 similar funds managed by a single fund house can have returns that are...

Home Country Bias 1

Home Country Bias

At heart, we are all very Nationalistic. We love our country regardless of whether its the United States of America or Zimbabwe. One reason for the unreasonable love maybe due to the fact that we are all invested in the progress of the country we live in (which for a large part of the population also happens to be the...

SPIVA® India Scorecard – A note 1

SPIVA® India Scorecard – A note

Today the Economic Times published a study a that claimed study by the S&P Dow Jones Indices says a majority of the large-cap actively managed funds in India underperformed the S&P BSE 100 index in the five years ending 31 December 2014 The whole study can be downloaded from here (Link). LT @NagpalManoj  There have been a few questions raised...

Walking the talk 0

Walking the talk

One of the toughest things to do in life is disagree with something and then walk the extra mile to showcase that you really mean what you say. For example, today Mr. Motilal Oswal who owns and runs Motial Oswal Financial Services posted the following tweet Trading is injurious to your wealth as well as health. Investing for long term...

Trusting financial Intermediaries 4

Trusting financial Intermediaries

In response to a tweet of mine, Anupam Gupta (b50) tweeted this @Moneylifers @Prashanth_Krish such huge distrust in the entire financial distribution chain, including MFs? any reason? — Anupam Gupta (@b50) May 22, 2015 They key question is, should we trust those who claim to work on our behalf while having a business model that goes against that very logic....