Image Credit When the Queen of England visited London School of Economics in 2008, here question to the economists was, "why nobody noticed it?" They failed to predict the financial crisis of 2008. There is lots of research done in the past in economic forecasting and there is still lot of ongoing work to predict... Continue Reading →

Image Credit If we see the trend of the last 30 articles they are related to investing. More specifically related to behavioral finance. After all, we win battle in the mind first then on the ground. Having the right mindset will ensure that one stays on the right track. However, we never discussed why should... Continue Reading →

If you are allowed to choose one between high frequency of success with low magnitudes and low frequency of success with high magnitudes. What will you choose? We like to win more and frequency matters a lot for us. We may end up choosing the first option. However, we ignored the magnitude part. It is... Continue Reading →

Image Credit It is a prototypical example for the enthusiast of game theory. Now let's deep dive into the dilemma. Two prisoners Alice and Bob are accused for committing a crime let say, for robbing a bank. Both are interrogated separately and given the following deal. If one of them confesses and the other one... Continue Reading →

Image Credit Previously we discussed about moats. The technology companies doesn't have long lasting competitive advantage as the their shell life is very low. For instance, Google has to venture into Google Chrome, Google Home, Android and many more products just to ensure people still use Google search. Advertising is the main revenue model for... Continue Reading →

Image Credit We will be talking about the story of the most fascinating stock of this year. The stock was relisted on 27th January, 2020 just with a price of 16.5 and after around just 5 months trading at 1176 on Friday. Its peak value for the year is 1519.65, that's approx 91 times the... Continue Reading →

Image Credit If you are a basketball fan you can easily relate to the title and the above picture. From the basketball world, I am only aware of the legendary player Michael Jordan. In 2003, Kobe Bryant was in the top of the world winning game after game for his team Los Angeles Lakers. However,... Continue Reading →

Image Credit The theory states that the more cash that builds up in the treasury of an organization, the greater the pressure to piss it away. After all, it is not simple to hold on to the cash. J Hugh Liedtke, former CEO of Pennzoil, believed that “companies should pay out cash so the managers wouldn’t... Continue Reading →

Image Credit Mean Reversion is a finance theory which suggests that the price of an asset will eventually return to its average level of entire dataset. When the price of a stock is below its average price, the buyers consider it attractive for purchase and anticipate the prices to rise in the short run. On... Continue Reading →

Image Credit The companies which have the capacity to suffer and sustain are miracles. For instance, Amazon and GEICO. Amazon has been not focusing in its profitability as much as it focuses on becoming the market leader or the willingness to fail more. GEICO, an insurance company lost $250 dollars on every policy it sold... Continue Reading →

The article is in continuation with this one. Request you to read the first part before you deep diver into the traits. Image Credit Here you go with the seven traits: Trait #1: The ability to buy when others are panicking and sell stocks while others are euphoric. It reminds me of the wonderful quote... Continue Reading →

Image Credit Back in 2007 Mark Sellers, Hedge Fund Manager of Sellers Capital delivered a speech to a group of Harvard MBA titled "So you Want to to Be The Next Warren Buffet? How's your writing?" I had the privileged to read the same speech over the week. I ended up reading it today. I... Continue Reading →

Image Credit NBFC stands for Non Banking Financial Corporation. It is a financial institution. However, it doesn't have the banking license. The primary difference between NBFC and bank is that the NBFC doesn't take demand deposit. You might be thinking what is demand deposit. The accounts where we can withdrawal funds at any time. Like... Continue Reading →

Image Credit Standalone is about the individuality whereas consolidation is about the group. Whenever you read about big companies you will come across 2 sets of data points. One is standalone and other one is consolidated. The data related to standalone is only for the parent company. For instance, company ABC has many subsidiaries all... Continue Reading →

Image Credit NPA refers to classification for loan which aren't recovered by banks or other financial institution. The bank provides loan to various industry segments. Some of them leads to failure other turns to profit. Here low success rate is not fruitful like in the investment world as the interest on loans doesn't turn thousand... Continue Reading →

Image Credit The title is bit weird. As safety is generally taken to avoid the danger. However, generally it takes us to opposite path. For instance, after the introduction of helmets in Rugby there are more fatalities than before. We generally have the notion that helmets must lead to fewer fatalities as they provide more... Continue Reading →

Image Credit The theory states that people expects regret if the results are not in their favor. Fear of regret plays a significant role in decision making. Let's take an example from the investing world. Suppose you get a recommendation for stock X from your friend or colleague or analyst. However, you didn't take it.... Continue Reading →

Image Credit It is simple the amount paid by the company to its shareholders. They are sharing some of the earnings with the shareholders for investing capital in the company. The ones who are holding the stocks till the ex-dividend date. Does every company pay dividend? Nope, for instance Berkshire Hathaway doesn't pay dividend. There... Continue Reading →