Understanding mean, median, mode, standard deviation, regression, reversion to the mean – is a pre-requisite to understand financial markets.
Let us see some simple examples:
It rained 90mm in Mumbai on 22nd July. If it rains like this for 6 months continuously, Mumbai will be drowned.
It was 43* C in Lucknow on 23rd May. If it scorched [...]
I am a part of the team that does a column called “Portfolio Doctor” for Money Today magazine. This column is very popular – and the requests for being featured far, far exceeds the number of columns that can be carried.
So here is what the editor of MONEY TODAY has to say about the column:
Here [...]
There are a few companies even in the sensex which come with good results quite regularly. In fact the market likes such companies and gives it a high price earning ratio.
So far this has been considered good behaviour and well rewarded. However the breaking of the Madoff scandal makes one feel uncomfortable about such good, [...]
I share a love-hate relationship with the media. I like many (most) of the media people I know, but am amused at the limitations with which they are made to work.
Let us take an example. I got a call from one of the media kids I know.
Media kid: Hello Sir…we have an investor query (all [...]
Why do people become proud? Or what are the sources of pride? Let us enumerate the sources from where man / woman get their pride:
Youth pride: ‘I am young’ is what Shankaracharya called ‘yovana garvam’. It is there is man right through childhood to old age!
Money: “I am rich’ is also a very strong pride [...]
A couple of days ago I gave you a few reasons to buy gold. Here I am giving you a few more reasons. However let me warn you that I do not have any trading interest in gold, but do have an investment interest in a company called Deccan Gold which is the only gold [...]
Are you in Denial mode regarding your retirement financial needs?
I cannot comment for every one, but too many people I meet are in denial about their financial needs for retirement. Most of us do not want to accept that we will buy 3-4 washing machines, air conditioners, refrigerators, maybe about 2-5 cars, at least one [...]
There are many reasons to buy Gold and hold it. Of course tomorrow I can give you many reasons NOT to own gold also. One reason NOT to own gold is the recent phenomenon in its price. For example if you had invested in gold in 1980 (US $ 590) today it would be worth [...]
If you read magazines, newspapers, etc. or watch the business channels you would have been convinced that people chase performance. Constantly ‘experts’ come on television and print media and say ‘people’ should not chase past performance. Actually articles and programs encourage people to churn or chase performance.
Do you know what a rating does? It rates [...]
I have been bursting crackers now for a few decades and obviously have some ‘cracker’ wounds, but nothing serious. About 3 years back my daughter’s teacher told her “when you go to burst crackers you should carry a bucket of water…just in case…”
So in the first year my daughter carried water on the first day [...]