Valuenomics Research

While some market players are concerned about growing stock price volatility, momentum traders have profited handsomely from the mood swings over the previous year and a half.  Investing in long-term momentum (5 years or 60 months) and short-term momentum (1 to 3 months) might lead to return reversal in the future. Interestingly in the medium term (6 to 12 months) actually exhibits a continuation of returns explaining the logic if in the medium-term growth trends the stock shows a persistently doing will show continuity in its growth trend or the period of future time and same way if it is continuously performing poorly it will continue to perform poorly as well in the long term. But in the current market situation of high volatility, investors can’t bet on continuation. Thus this has changed the strategies and behavior of investors have changed.  Momentum Investors are tracking the short term, i.e., 1 to 3 months, to check on the returns, and so the portfolio has to be constantly reba

     stockmaniacs.net      As students of investing, many of us have encountered questions in life where we did not know the correct answer; however, we were sure which answer wasn't the correct one. Short sellers in the market make use of this rationale while choosing their investment avenues. Essentially, short selling is betting against the odds of a firm being successful in the future. It is a process whereby the investor sells borrowed stocks in the market in the hope of repurchasing them at a lower price, benefiting from the difference between the purchase price and the selling price. The concept of selling something you don't own might seem absurd, but savvy investors can use this skill to gain hefty profits. From an investor's perspective, short selling has an array of benefits to offer. The first and most apparent one is that it provides the opportunity to make money not only when a stock goes up but also when it goes down. Furthermore, it can be used to hedge yo

 In the context of mutual funds, too, investors have been pondering over the question of the persistence of results since forever. Be it any field, consistency of results is something that can be found in any prosperous venture. As it is famously said, persistence is key to success. Let's start by understanding the importance of uniformity of returns. Investors often get misguided by investing in a mutual fund seeing its highs on a particular day, or vice-versa. This practice does not paint an accurate picture of the performance of the mutual fund. A fund must be analyzed to see if it can sustain itself in a dynamic environment.  It must be ensured that it earns returns higher than the market at all times and not just a point in time. Now the question arises that what defines this consistency? A mutual fund can be classified as a stable one when its performance is better than the benchmark at any given time. As per SEBI's guidelines, every fund house devices its benchmark i

  For the past few months, there is a lot of Hype About ESG Investing. So, Let's Take a Deep Dive by understanding what it is? ESG stands for Environmental, Social, Governance. Now, let’s understand the concept of ESG Investing one by one. Environmental criteria address a company’s operations environmental impact, Environment and environmental stewardship. Social criteria refer to how a company manages relationships with and creates value for stakeholders. Governance criteria refer to a company’s leadership & management philosophy, practices, policies, internal controls, and shareholder rights.   KEY TAKEAWAY ESG is about the ability to create & sustain long-term value in a rapidly changing world, and managing the risks & opportunities associated with these changes. There is no universal categorization for ESG issues, and some can be defined in different ways depending on the industry, company characteristics, and the business model. Now that being sa

What does Inflation Targeting mean? Inflation Targeting is a central banking policy that revolves around adjusting monetary policy to achieve a specified annual rate of inflation. The principle of inflation targeting is based on the belief that long-term economic growth is best achieved by maintaining price stability, and price stability is achieved by controlling inflation. Types of Inflation Targeting Strict inflation targeting is adopted when the central bank is only concerned about keeping inflation as close to a given inflation target as possible, and nothing else. Flexible inflation targeting is adopted when the central bank is to some extent also concerned about other things, for instance, the stability of interest rates, exchange rates, output, and employment. Background India formally adopted flexible-inflation targeting (FIT) in June 2016 to place price stability, defined in terms of a target CPI inflation, as the primary objective of the monetary policy. In this context, it

Currently, 10- Year U.S Treasury yield is around 1.6 percent. On 25 th Feb 2021, a 10-year bond made a high of 1.614 percent and this is the highest level since 14 th Feb 2020. The yield of a 30-year bond rose to 2.28 percent .   As we can see in the above chart from Dec 2020 levels, yield rates rose by 80 bps points.   In India, the 10-year Bond rate climbed to 6.20. How Bond Yield Effect Government Borrowings? Bonds are basically loans taken by a corporation or Government and investors receive principal at the end of the bond period. When Bond Yields rise then RBI needs to provide higher yields to investors. Recently when there was Single day rise of 10 Basis points RBI had to reject the bids because investors were looking for high yields. During the Budget, session the Government announced that they are looking to borrow 12 lakh crores during the upcoming financial year. Usually, Government borrowing cost is used as the benchmark for pricing interest rates for loans give

  Pic Credit - Business Insider Chamath Palihapitiya is a Sri Lankan-born Canadian-American venture capitalist, engineer, and the founder and CEO of Social Capital. For more about him- https://cutt.ly/Rjel9Zq A compilation of sorts. Might be a bit different from other compilations that you’re used to. But my aim here was to provide more snippets and summaries. Highly encourage you to read the source material for a more well-rounded view of his thoughts though. Keep in mind this is a work in progress and continually updated as I find new snippets, summaries, and links. On Social Capital (His venture fund) We are not building a venture fund – at least that’s now what I want to build – and I don’t really have any attachment to the role of CEO, but I do think I set the vision of a place, culture, and values of where we work. If you ask me what we are today: we are in this primordial stage where we look like a venture firm. We take a lot of capital – ours and other people’s – and invest it