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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.
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.
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…
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…
#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%.
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%!!
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
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
