Discover and read the best of Twitter Threads about #wherethesmartinvestorsare

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#WhereTheSmartInvestorsAre
1/n All about small-cap.

Small cap – BSE defines small cap as the 250 smallest companies in the BSE 500 index which itself is the 500 largest market cap companies in India.
2/n

Historical performance of the Small Cap Index in India.
3/n

Is there a small-cap alpha?

Globally - yes.

First identified by Rolf Banz in 1981

“It is found that smaller firms have had higher risk-adjusted returns, on average, than larger firms.”

sciencedirect.com/science/articl…
Read 11 tweets
#WhereTheSmartInvestorsAre

1/n

Drawdown - "A drawdown is a peak-to-trough decline during a specific period for an investment"

For eg. Nifty 50 went from 12,088 to 10,980 since early June or a Drawdown of ~10%.
2/n

The markets are almost always in a drawdown.

Only 6% of trading days since 1990 produced new market highs i.e for 94% of trading days the market was in a drawdown.

The average drawdown for NIFTY 50 over the past 29 years has been -18%!!
3/n

So what about a -10% drawdown.

Nifty 50 has been in a -10% or worse drawdown in 59% of the trading days since 1990.

Read the above sentence again.

#KnowYourMarketHistory
Read 8 tweets

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