If there are a few basic investment lessons, and you must know, these are the ones: 1. The earlier you start the better, but TODAY is surely better than Tomorrow. 2. Your total return depends on how much return you get on each portion of your portfolio. So if 10% of your money is in […]
What is cognitive dissonance? Actually the question should be why as an investor / wealth creator should you be aware of this! Cognitive dissonance is our need to justify all our actions – even if we know that it is not worth justifying. It is easier to see examples of what is cognitive dissonance. We […]
The most misused and least understood ratio is the Price Earning ratio or the P E Ratio….Almost everybody who ‘invests’ talks about P/E ratio. I am sure there are many people who do not understand the full form but use it nevertheless. Well when a company earns Rs. 20 as its annual earnings, and is […]
Not sure how many people saw the news item of AIG wanting to sue the New York Fed for ‘bailing’ it out of the fiscal mess. Well it is not AIG, but its ex CEO Mr. Hank Greenberg who controls Starr International who is keen on the suit filing. If you are an American tax […]
I meet all kinds of kids – and it is worth seeing their attitude towards money and their parents. Of course their attitude is a function of what they have seen – and they have seen you. So if you are irresponsible, hey they too will be. Some kids think that their parents owe […]
It hardly matters whether it is equities or real estate, the reasons why people lose money is so simple to enumerate: 1. Not knowing the difference between trading and investing: they buy some shares, hope it goes up when it does not they sell off. Since they do not know whether they should be averaging […]
There are so many people today masquerading as financial planners, financial trainers, financial experts on media…I was amused when I heard the statement ‘Equity markets give good average returns’. If you ask me this is brilliant but useless advice! Why? Because to understand equity markets you need to understand Arithmetic Mean, Geometric Mean, Standard Deviation, […]