Equity allocation in US household wealth
It is interesting to track how the equity allocation trend is changing in US with the underlying changes in demographics. Although last year’s economic crisis (It feels nice to say that in retrospection!) would have pushed households to move away … Continue reading
Gold is riding high at $1200/oz on the back of high profile purchases by the central banks in India and Russia. The gold reserves as proportion of total forex reserves is less than 5% for both countries – so no … Continue reading
Barclays sold BGI to BlackRock – What does it mean?
Barclays decided to sell its Investment Management group, Barclays Global Investors (BGI) to BlackRock. As part of the deal BlackRock is also getting iShares, the ETF arm of BGI. After the consolidation BlackRock will boast an asset base of $2.7 … Continue reading
Confessions of a risk manager is a classic article in Economist published around Aug 2007 before all the hell broke loose. This is my second reading of the article after it was published. Looking back now the risk manager’s concerns … Continue reading
Loss aversion and trader’s psychology
How professional traders will behave under stress is a very intriguing topic. They were supposed to be taking reasonable decisions under stressful conditions of trading environment where speed is of the essence. The article points out that under extreme stress … Continue reading
Efficient market hypothesis in question
The search is on to find a replacement to efficient market hypothesis. Efficient market hypothesis in its strongest form indicates that the current price of an asset fully reflects all the available information about the asset. The theory came with … Continue reading
This article on Credit-default swaps and bankruptcy highlights another instance of collateral damage of CDS (Credit Default Swaps) contracts to the economy. There was another detailed article in FT on the unintentional and negative outcomes of CDS contracts (which I … Continue reading
This article Corporate planning through the fog describes how annual budgets will become a thing of the past. The markets and economy are changing so rapidly, more now than ever, that a budget may become useless in the next quarter. … Continue reading
Efficent market hypothesis revisited
Perhaps no other theory in Investing has been proved right and wrong so many times in its history as Efficient market hypothesis, an idea that all the available information about a company is already reflected in the stock price. Therefore … Continue reading
Francis coupla and Wall street killer formula
This Wired.com article Recipe for Disaster: The one formula that killed Wall St is probably the closest to answering the question I always wanted the answer for. “How could so many brilliant bankers go wrong?” Before quant models came along, … Continue reading