The week saw increased scrip level volatility and better index level stability. This paradox is increasingly becoming a trend in our markets. Indices are showing lower volatility while more constituent scrips are showing very high volatility. The closer scrutiny in the corporate governance of individual companies is clearly the…
The extension of single party rule in India is now clearly off our radar. The 2019 general elections will be won on the strength of alliances. Obviously, the ruling party will need to reboot its strategy while the opposition suddenly seems to have begun its preparation earlier. As investors, we…
Have you ever tended to a garden? As a gardener, you would ensure that your plants get enough sunlight, water, and nutrition. But, there is an inherent expectation that your garden will flourish. Imagine you received a handful of seeds. You were told that these seeds would eventually grow into…
https://soundcloud.com/ithought-advisory/validating-advice Podcast Transcript Every portfolio often needs validation. Our ideas are constructed in a particular context and we find that soon thereafter the market context changes dramatically. My own experience from previous bull runs is what comes to mind. When we come out of a bull market, we tend to…
Investment Strategy: The RBI’s stance of calibrated tightening indicates that rate hikes are possible but not mandatory. As investors, it is important to capitalize on rising yields to structure a layered portfolio. The spread between the repo rate and the 10 Year Government Security is nearly 1.5%. This presents a…
If an asset class is hitting multi-year lows, then we tend to move away from it. On the contrary, when an asset class is nearing multi-year highs, we see the most clamour for it. Investor behaviour tends to shun risk exactly when valuations are very much in favour. The current…
Podcast Transcript The markets are hitting new highs. But my advisor says, “Think long term”. I asked him if we need to book some profits. He says “Do nothing, just let the investments stay.” Friends, keep bringing up these conversations more frequently these days. The problem with…
Opinions are very different from judgements. Investment is a field where we carry both and apply them constantly. Opinions are lighter, presumptive, and easy going. We can like or dislike a personality, a business leader, an industry, or a business. Opinions formed on the basis of instinct rather than inquiry…
Podcast Transcript How we develop conviction matters. Everybody agrees that the quality of conviction will determine many things- how we translate conviction into investments, how we allocate money into an investment, and how we hold onto the investment. Generating conviction, growing conviction, preserving conviction and translating conviction are four…
In good years, defensive investors have to be content with the knowledge that their gains, although perhaps less than maximal, were achieved with risk protection in place, even though it turned out to be not needed. – Howard Marks Every investor scrutinizes the relationship between risk and…
Stock picking takes far more mind space, time, and effort in every investor’s life. The time dedicated to stock picking far exceeds the time spent on investment strategy. Stock picking and investment strategy are connected in the middle. The reasons are not difficult to decipher. Deep within, we believe that…
A not so innocuous news report by a global brokerage set us thinking about where we are headed as a market. ” $1.2 billion waiting to get into midcaps says CLSA”. The logic behind this premise interested us even more than the actual premise. The premise was that mutual fund…
