SIP Investing: Active Funds v/s Index Funds

Cartoonist: Collins, Dan; cartoonstock.com – Sunday, 12 March 2017 I think the image above correctly describes the ethos in the minds of the Indian Mutual Fund Investor. Practically everyone now uses a Systematic Investment Plan (SIP) for investing in the Indian Stock Market. A Systematic Investment Plan (SIP) as an investing strategy has stood the test of time, and its efficacy is beyond doubt. However, I wish to highlight the fact that the asset class that is chosen is far […]

Mutual Fund Investing: Active Share

Cartoonist: Farris, Joseph; cartoonstock.com Saturday, 25 February 2017 In the world of Mutual Fund Investing, one can be an active investor by investing in an actively managed fund or a passive investor by investing in an index fund. How does one decide as to how ‘Active’ a money manager in an Actively Managed Fund is? That’s what ‘Active Share’ is all about. Passively managed funds are those that mimic the benchmark. Actively managed funds are the ones whose composition varies from […]

Investment Strategy: The Nifty100 Equal Weight Index

Cartoonist: Schwadron, Harley; cartoonstock.com – Sunday, 12 February 2017 How many of us have a strategy while investing? How important is it? I think that having an investment strategy in place is a precursor to the actual investment process and its importance cannot be understated. Investment Strategy: Why? In the extremely noisy world of investing products, there are multiple strategies. To be fair, there cannot be any one strategy that fits all. Each of us has to devise or tweak our […]

Is the Nifty 50 a Fair/Flawed Benchmark?

Cartoonist: Hesse, Peter; cartoonstock.com – Sunday, 29 January 2017 The obsession of the investing community with benchmarks has increased their importance. The Nifty 50 Index, disseminated by the National Stock Exchange of India (NSE) is the most popularly used benchmark for the Indian Stock Market. Nifty as a Benchmark The Nifty 50 benchmark index represents 65 percent of the float-adjusted market capitalisation of stocks that are traded on the National Stock Exchange of India (NSE). I think it is necessary to […]

Magic Formula Investing: Why Does it Work?

Cartoonist: Brown, David; cartoonstock.com – Sunday, 15 January 2017 A Magic Formula Investing post has become an annual ritual on Sentiments & Bubbles. Using the Magic Formula as an investing strategy was popularised by Joel Greenblatt in The Little Book that ‘Still’ Beats the Market Magic Formula Investing is a strategy whereby we end up buying shares in companies that have both, a high earnings yield and a high return on capital. In other words, we buy shares in good […]

Insider Sentiments – 1 of 2017

Zensar Technologies Limited Zensar Technologies Limited is part of the RPG group. Zensar prides itself on being a digital solutions and technology services company. The company offers the complete range of traditional and transformational IT services and solutions across application management and infrastructure management services. It has got a global presence across, and their business is well spread across 29 global locations with a presence in the key regions of US, Europe, Africa, Middle East, India and APAC. They have […]

Forecasting 2017: Are You Nuts; Why Not Throw Darts Instead?

Cartoonist: Morris, John; cartoonstock.com – Sunday, 1 January 2017 It does appear that forecasting has become little more than an excuse for sloppy thinking. Hence, it would be easy to conclude that we should ignore forecasts altogether. But just as we don’t throw out an ideology because it has been used disingenuously, we shouldn’t be too quick to dismiss forecasting skills. Burton G Malkiel in his seminal book A Random Walk Down Wall Street – The Time-Tested Strategy for Successful […]

Insider Sentiments – 11 of 2016

Insider Sentiments – 11 of 2016 – Ambika Cotton Mill Limited (AMBIKCO) Ambika Cotton Mills Limited is engaged in manufacturing and selling of speciality cotton yarn. The company caters to the needs of manufacturers of premium branded shirts and t-shirts. Exports constitute a significant portion of the operations. The company operates with total installed spindle capacity of 108228 in a small facility housed in four units. The company has an installed 27.4 MW wind power capacity for captive consumption of […]

Insider Sentiments – 10 0f 2016

Insider Sentiments – 10 of 2016 – Finotex Chemical Limited (FCL) The Finotex group was established by Surendra Tibrewala in 1979. FCL was incorporated as a public limited company in 2007. FCL was listed on the Bombay Stock Exchange (BSE) in March 2011 and subsequently on the National Stock Exchange of India (NSE) in January 2015. This is how the price action looks from the listing date: FCL – Price Action since Listing on BSE What does FCL do? Finotex […]

Mutual Fund Investing: Have You Heard of Survivorship Bias?

Cartoonist: Bacall, Aaron; cartoonstock.com – Sunday, 18 December 2016 What does Survivorship Bias mean in the investing world and how is it relevant in the Indian context? Survivorship Bias – Definition Survivorship Bias is defined as the logical error of concentrating on the people or things that “survived” some process and inadvertently overlooking those that did not because of their lack of visibility. I’ll try and make sense of the above definition. Mutual Fund Schemes now account for the bulk […]