“The point is, ladies and gentleman, that greed, for lack of a better word, is good.” – Gordon Gekko
“Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.” – Warren Buffet
Greed may have been good for Gordon Gekko (at least for a while), but in the investment world it rarely is as Warren Buffett is famous for saying.
Investors are unequivocally greedy today, and with some perspective it is hard to blame them. Continue reading
This time Nassim N. Taleb came out with “The Spurious Tail” with reference and based on his book Fooled by Randomness.
A spurious tail is the performance of a certain number of operators that is entirely caused by luck, what is called the “lucky fool” in Taleb (2001). Because of winner-take-all-effects (from globalization),spurious performance increases with time Continue reading
Before the Grexit and Brokers terminologies I did an article from the train that focused on European Debt Crisis : Resolution or Dissolution. While returning back from Indore to Mumbai by India‘s non stop trains Duronto express. I met a lady and has an argument on the financial market profession and the expression of love. She has her own point of view that the people from Finance industry do not understand emotions and run for money.
But I believe emotional difficulties are common to all the profession Continue reading
Leading financial media broke the story on thursday night about the $2bn trading loss on credit derivatives trading, which chief executive Jamie Dimon blamed on errors,sloppiness and bad judgement” and warned “could get worse”.
Well the Centre of loss in non other than bank’s chief investment office (CIO).It is responsible for managing and offsetting the vast amounts of “credit exposure” the bank incurs through its daily Continue reading
CLNs are customized credit derivatives in the unregulated over the counter (OTC) market, issued by a bank or financial institution backed special purpose vehicle or trust. They are structured to allow the issuer to transfer a part of the credit risk to investors, who are willing to bear such a risk in return for higher yield. These deals are done outside the country, as OTC derivative contracts have no legal standing in India.This is how a CLN broadly works. A company borrows a certain amount from a bank or makes a convertible offering to that bank. Continue reading