"Bucketizing" Your Investments
- Anup Bansal
- Mar 1 2012
"Bucketizing" is not a word that can be found in English dictionaries so let me explain the term. I have coined the term "Bucketizing" for the process of allocating dedicated investments to a particular financial goal. For example, an individual may buy a Child Plan that provides both insurance as well as funds for the child's education when she turns 17 years old. Similarly, there may be dedicated investments for one's retirement plan. Hence, an individual plans by creating "Investment Buckets"...
The Curious Case of Real Estate Investments
- Anup Bansal
- Sep 13 2012
Rs. 8 lakhs invested in a piece of land in 1990 in a non-metro city is worth Rs. 3 Cr today. We all have been reading and hearing about the phenomenal returns, that too risk-free (I will take that with a grain of salt), in real estate investments. Let us put things in perspective. The CAGR (Compounded Annual Growth Return) is 17% per annum on this investment. Now same 8 lakhs invested in the Sensex in 1990 - the index had touched 1000 first time that year - would have fetched Rs. 1.42 Cr today. Though...
The X-Factor
- Anup Bansal
- Sep 15 2018
"It is all about timing!" The protagonist Chesley Sullenberger says in the movie 'Sully'.Captain Sullenberger (known as Sully) landed the US Airways flight 1549 on river Hudson in New York when the plane got hit by birds after taking off from La Guardia airport on January 15, 2009. The survival of all 155 people on-board was nothing short of a miracle as "people do not survive water-landing". Sully was hailed as a hero before the National Transport Safety Board (NTSB) initiated an investigation and...
Be the BULL in this market, Invest More!
- Anup Bansal
- Oct 21 2018
The securities arm of a well-known bank that serves both Institutional and Retail clients gave SELL rating on Hero Motorcorp for Institutional clients and ACCUMULATE rating for Retail clients on the same day. I guess they wanted to keep making the market on this stock and ensure there were enough buyers for the institutional sellers. I am a patient investor, but such practices make me so impatient (and aggravated)!We all are getting numb with the market volatility in the last one year with almost...
Volatility is your friend!
- Anup Bansal
- Feb 6 2018
Today the Indian stock market fell by around 1.5% and has fallen by around 4.8% in the last four sessions since the budget. We all are feeling the pain of the downturn and the rise in the volatility. Just to put things in perspective, even after this correction, the Indian equity market has given a gain of 19.3% in the last 1 year and 42.1% in the last two years.What is volatility? It is the day to day unpredictability of markets. If there are too many changes in stock prices every day then the volatility...
FOMO
- Anup Bansal
- Jan 26 2018
I happened to be on Dalal Street on the day Sensex crossed the mark of 35,000 on 17th January. There was the crowd, there were cameramen, there were balloons, the environment was charged with jubilation and the celebrity was SENSEX!Then, the news cried out loud this week "....the Sensex took just five trading sessions (January 17-23) to reach the historic 36,000-level from 35,000....". And, you may have been going slow with equity investments anticipating a downturn in the market due to the high...
June Newsletter - 2019
- Mitraz Knowledge
- Jun 30 2019
KNOWLEDGE - DISPOSITION EFFECT BIASSymptoms - This refers to a tendency to label investments as winners or losers on the basis of unrealised gains and loss.Effect - Investors tend to sell their winners too fast and hold on to their losers. Studies have shown that on an average, the winners have performed much better than the losers. The portfolio return suffers over the long term because of selling the winners in an attempt to protect short term return. Also, the investor loses the chance to balance...
February Newsletter - 2019
- Mitraz Knowledge
- Feb 28 2019
KNOWLEDGE - NARROW FRAMING BIASSymptoms - Insistent focus on the performance of individual securities, looking at individual asset class performance in isolation.Example - Gold which is used to diversify the risk involved in high equity allocation is considered a bad decision once the equity part has performed good without considering that gold was a part of the portfolio and is looked in isolation on the basis of returns.Effect - A narrow framing bias leads to frequent exits or lower investments...
January Newsletter - 2019
- Mitraz Knowledge
- Jan 31 2019
KNOWLEDGE - SELF SERVING BIASSymptoms - The tendency to attribute favourable outcomes or successes to one's own skill/internal factors and attribute unfavourable outcomes to bad luck/external factors. Many times, outcomes can be bad because of our own wrong reasoning and not due to lack of luck. This is dangerous in the investment world because it stops us from improving our skills and creates overconfidence in our abilities to generate positive outcomes.Example - A Mutual Fund-Card always blames...
