postaday2011 | wealthymatters

Volatility and the Indian Stock Markets

June 19, 2011 8 Comments

wealthymatters.com The volatility of the Indian market which is above 26% is one of the highest in the world. So though the long-term CAGR of the Indian market is 15.60%, there have been specific points in time when the market returned 1.25% pa for a 10-year period as well as 19.98% pa for another 10-year period.

One of the biggest impacts of this volatility is that it increases the entry-point and exit-point risks in investing. The simplest way of tackling this risk is to invest in the market at regular periods of time, irrespective of its levels to achieve cost averaging and also participate in the long term upward trend of the Indian markets. Also it is better to stick to the stable large-cap blue-chip companies. Read more of this post

Filed under Paper Assets, Theory Tagged with blue chips, Bullion, CAGR, commodities, correlation, cost averaging, debt, diversification, entry point risk, exit point risk, Gold, Indian Stock Market, low corelation, negative corelation, postaday2011, RandomBlog2011, stock market, volatility

Stock Market Cartoon

June 19, 2011 1 Comment

Here is a cartoon I found today.Enjoy!

There’s more work by the artist here:http://cartoonistsatish.blogspot.com/ .

Filed under Tidbits Tagged with postaday2011, RandomBlog2011, Satish Acharya, stock analyst, stock market

Rakesh Jhunjhunwala on ET NOW

June 19, 2011 2 Comments

This is a video of a short interview of Rakesh Jhunjhunwala aired on ET NOW.I caught it on TV earlier this week.I thought of putting it up here for the actionable information it contains.So Gook Luck! But do remember not to be too greedy as even the legends can be wrong.

Filed under Paper Assets Tagged with bearish, bullish, Delta Corp, equities, ET NOW, Indian Markets, Inflation, interview, Investor, Lupin, Nifty, Nifty50, postaday2011, Rakesh Jhunjhunwala, RandomBlog2011, sensex, share investing, shares, stock, Titan Industries, trader, video

The Ascent of Money

June 19, 2011 1 Comment

wealthymatters.com The Ascent of Money by Niall Ferguson is a fantastic book.I was drawn to read it after watching the TV series based on the book and I have no regrets.It’s time and money well spent.

The book describes how banks, joint stock stock companies, bond markets, insurance companies, etc. originated at different places, at different points in time, in response to specific needs .While I was reading the book I had many aha moments and I heartily recommend the book to anyone who wishes to understand our modern financial world better.

Prof.Ferguson also tells the fascinating stories of how time and again with every financial innovation there have been abuses and excesses.These stories are great to remind us that neither good nor bad times last forever,that frauds and scams are par for the course and that no financial crisis is the end of the world though it might end the world as we know it. Read more of this post

Filed under Theory Tagged with banks, bond markets, bonds, book, book review, finance book, financial crisis, financial history, frauds, insurance companies, joint stock companies, Niall Ferguson, postaday2011, RandomBlog2011, scams, stock markets, stocks, The Ascent of Money A Financial History Of The World, video

Something About Coke

June 12, 2011 Leave a comment

Coca-Cola made an IPO in 1919 when it issued shares at $ 40 each. A year later, the share was quoting at $19. You might think that’s a disaster because the share had lost 50% of its value in just one year. After that there was sugar rationing and the farmers were rebellious. Years later, the Great Depression and World War II happened, there were thermonuclear weapons and what not. You could always find a reason for why that was not the right time to buy shares of Coca Cola. But if you had gone ahead and bought that one share for $40 and reinvested the dividends, your investment in Coca-Cola would be worth $5 Million today.