Good Investing Lessons

This is an article that I read on 26th September 2012. It has been over a year now and I suddenly remembered. I'd posted this last year with some other predictions from CNBC etc. During then, I was very fascinated listening to these experts. They are so confident and so logical. I always admire their ability to "read" the market and manage hundreds of millions of dollars of other people's money. So of them managed billions of dollars. Then I thought what if they ever go wrong? Won't they lose a lot of money? So, I think it would have been interesting to remember what they said and then we verify later. On 26th September, the S&P 500 index closed at 1433.32. One year went on and it went up another 19% from there. Below is S&P 500 over last one and a half year. As we can see, the market has still been a bull. Over the one year period, the S&P 500 index did correct itself. However, it was a

There is a lot of talk about Spanish sovereign debts recently. I came across a research paper which I think is very useful for me and wish to share it here. This is taken from www.fundsupermart.com, an online fund broker where you can purchase funds form various fund managers. This portal provides some research and comparisons and it is essentially a self service portal. From the chart provided, we can see that there is a problem for Spain to service their debts for the next 4-5 years if the debts are not re-structured. With this kind of risk, no sane investors would want to risk their money to buy Spanish bonds. They can only turn to European central bank for bail out. The blue arrow is a fictitious line I draw assuming re-structuring is going to happen. Essentially, they have to move the payment of capitals into next 5-20 years to be affordable. In addition to that, they can't make additional loans. This is just taking a very simplistic view of the situation. To have that hap...

You probably had been hearing a lot about this. I kept hearing this from seminars and some investment gurus. So, I decided to do a simple research and analysis. Here is what I had come up with: The table below shows the Price Ratio of Gold/Silver and the 5-YR Simple Moving Average. To see better, plot a chart to see how the ratios moves over the years. I'd plotted using annual and its 5 period simple moving average. This chart showed that the average price ratio advanced over the years. However, recent 10 years, there seems to be some fluctuations. In fact, it seems that silver price had advanced more aggressively than gold price resulting in a drop of the price ratio. I don't know what the experts based on. If silver price were to advance more than gold, it will bring the ratio even lower near to the ratio 20 years ago. However, if you based on recent 10 years, silver price has to retreat or gold price has to advance in order to go back to the average. Even though the current ...