"Don't fight forces, use them."
— R. Buckminster Fuller
(American, 1895-1983)
Word for the day
Coeval (adj)
Of the same age, date, or
duration; equally old:
Malice towards none
BSP says, it will be
Mayawati vs. Modi in 2019!
What do you think?
(a) It's a smart preemptive
move by BSP;
(b) Mayawati is playing for
BJP;
(c) BSP is despearte to get
attention of potential grand alliance partners.
First random thought this morning
In past four years we have seen a variety of religious men, of all
hues and colors, in the dock. The charges vary from rape, physical exploitation,
child abuse, sodomy, cheating, drugs, sedition, land grab, adultery, etc.
It could be a topic of interesting research to discover whether
this phenomenon is due to deep social reform taking place in the country, which
is exposing these pseudo religious men; or the government is targeting these
manipulators who exploit the gullible people behind the facade of religion; or
the religion has degenerated so much that these so called religious men are
targeting their "rivals" and helping law to catch them; or it is
something else.
Anatomy of current market cycle
To evaluate my investment strategy in light of the current state
of affairs in the Indian equity market, I find it pertinent to note the market
behavior in past five years, i.e., since late August 2013, when the current
bull market did actually start.
In particular, the following trends (based on top traded 1111
stocks on NSE) are worth noting:
(a) Nifty has returned a
CAGR of ~17% in past five years. ~56% of Nifty constituents have outperformed
the benchmark, with top 20% accounting for most of the returns.
(b) At top end of the
market we see a distinct sectoral trend. However, no such trend is visible in
the broader markets. At top end, financials (ex PSBs) and auto have led the
gains, while energy, pharma, and telecom have underperformed notably.
(c) In broader market both
top outperformers and laggards are random stocks with no distinct business
trend. Though, with the benefit of hindsight one can say that worst performers
are dominated by NCLT cases.
(d) An analysis of broader
market's return profile shows that active investment had almost equal chance of
providing more returns than passive investments made in Nifty, with just about
58% stocks returned more than Nifty.
There was an equal probability of hitting a jackpot (return over
50% CAGR) as was the probability of losing capital. 175 stocks returned over
50% CAGR during past 5yrs, while 236 stocks returned negative returns. Large
cap funds mostly mirrored Nifty returns.
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To put things in perspective, Gold ETF returned close to 3% CAGR
and Debt Funds returned ~9.25% CAGR during past 5yrs.
...to continue tomorrow
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