Markets & After hours
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Oops... TP have different views. If US markets crack, global markets follow - as funds look for safety first and then return of capital. What drives our markets? FII's ofcourse. If FII's had to withdraw today, I would not be surprised if we tanked 50%. During the Sub-prime crisis, Nifty lost about 1/3rd of its value i.e about 1,500 point in a matter of two months. It went from 4,400 to to below 2,900
To think that FII's had to withdraw their entire investments here, I shudder to think..... Just my views.....
To think that FII's had to withdraw their entire investments here, I shudder to think..... Just my views.....
Here's some light hearted entertainment
Of course, this is about American markets, which have no bearing on our indices.
Of course, this is about American markets, which have no bearing on our indices.
An insight into the mind of Warren Buffet :
http://www.bloomberg.com/news/2014-...-liquidity-curse-celebrates-property-bet.html
Excerpt :
Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., cited a farm he’s owned since 1986 to caution individuals against frequent buying and selling of stocks. Investors should treat their equity holdings like real estate purchases, focusing on the potential for profits over time rather than short-term price fluctuations, Buffett, 83, wrote in an excerpt from his annual letter published on the website of Fortune magazine today.
“Those people who can sit quietly for decades when they own a farm or apartment house too often become frenetic when they are exposed to a stream of stock quotations,” Buffett said. “For these investors, liquidity is transformed from the unqualified benefit it should be to a curse.” Buffett has pursued a buy-and-hold investment approach as he built Omaha, Nebraska-based Berkshire into a $280 billion company accumulating the largest holdings of Coca-Cola Co., American Express Co. and Wells Fargo & Co.
“The goal of the nonprofessional should not be to pick winners,” Buffett wrote. “The ‘know-nothing’ investor who both diversifies and keeps his costs minimal is virtually certain to get satisfactory results.” Buffett’s track record of profitable stock picks and takeovers has helped make his letters a must-read on Wall Street. The billionaire has said he writes them to be understood by his sisters, who don’t work in finance.
In today’s excerpt, Buffett cited the agricultural holding and a 1993 investment in New York City real estate. The farm is worth about five times what Buffett paid, and earnings have tripled, he wrote. Annual distributions on the retail property, near New York University, now exceed 35 percent of the initial investment. He purchased the 400-acre (1.6 square kilometer) farm, located 50 miles (80 kilometers) north of Omaha, for $280,000 in 1986. He says he calculated the farm’s return to be about 10 percent, based on production estimates for soy and corn.
‘Moody Fellow’
The billionaire compared the daily fluctuations in stock values to an erratic neighbor standing near his property, yelling out offers for the land. “If a moody fellow with a farm bordering my property yelled out a price every day to me at which he would either buy my farm or sell me his -- and those prices varied widely over short periods of time depending on his mental state -- how in the world could I be other than benefited,” Buffett wrote. “If his daily shout-out was ridiculously low, and I had some spare cash, I would buy his farm. If the number he yelled was absurdly high, I could either sell to him or just go on farming.”
“Owners of stocks, however, too often let the capricious and irrational behavior of their fellow owners cause them to behave irrationally,” he wrote. “Because there is so much chatter about markets, the economy, interest rates, price behavior of stocks, etc., some investors believe it is important to listen to pundits -- and, worse yet, important to consider acting upon their comments.” Buffett has said that he regrets not taking advantage of such irrationality to sell holdings. Coca-Cola Co., one of Berkshire’s largest equity holdings, was one of the billionaire’s most successful investments in the 1990s, reaching prices that were more than 45 times earnings at the end of 1998. The investment has fared worse since then. While the stock price has recovered most of its losses since falling from the 1998 peak, Coke’s price-to-earnings ratio is less than half of what it once was.
Despite that regret, Buffett reiterated his view today that excessive trading can diminish returns. “Both individuals and institutions will constantly be urged to be active by those who profit from giving advice or effecting transactions,” he wrote. “The resulting frictional costs can be huge and, for investors in aggregate, devoid of benefit.” Berkshire last week decided to stop letting high-speed traders purchase direct access to press releases distributed by its Business Wire unit. Such firms often enter and exit positions in less than a second. Buffett said last year that such activity is “not contributing anything to capitalism.”
http://www.bloomberg.com/news/2014-...-liquidity-curse-celebrates-property-bet.html
Excerpt :
Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., cited a farm he’s owned since 1986 to caution individuals against frequent buying and selling of stocks. Investors should treat their equity holdings like real estate purchases, focusing on the potential for profits over time rather than short-term price fluctuations, Buffett, 83, wrote in an excerpt from his annual letter published on the website of Fortune magazine today.
“Those people who can sit quietly for decades when they own a farm or apartment house too often become frenetic when they are exposed to a stream of stock quotations,” Buffett said. “For these investors, liquidity is transformed from the unqualified benefit it should be to a curse.” Buffett has pursued a buy-and-hold investment approach as he built Omaha, Nebraska-based Berkshire into a $280 billion company accumulating the largest holdings of Coca-Cola Co., American Express Co. and Wells Fargo & Co.
“The goal of the nonprofessional should not be to pick winners,” Buffett wrote. “The ‘know-nothing’ investor who both diversifies and keeps his costs minimal is virtually certain to get satisfactory results.” Buffett’s track record of profitable stock picks and takeovers has helped make his letters a must-read on Wall Street. The billionaire has said he writes them to be understood by his sisters, who don’t work in finance.
In today’s excerpt, Buffett cited the agricultural holding and a 1993 investment in New York City real estate. The farm is worth about five times what Buffett paid, and earnings have tripled, he wrote. Annual distributions on the retail property, near New York University, now exceed 35 percent of the initial investment. He purchased the 400-acre (1.6 square kilometer) farm, located 50 miles (80 kilometers) north of Omaha, for $280,000 in 1986. He says he calculated the farm’s return to be about 10 percent, based on production estimates for soy and corn.
‘Moody Fellow’
The billionaire compared the daily fluctuations in stock values to an erratic neighbor standing near his property, yelling out offers for the land. “If a moody fellow with a farm bordering my property yelled out a price every day to me at which he would either buy my farm or sell me his -- and those prices varied widely over short periods of time depending on his mental state -- how in the world could I be other than benefited,” Buffett wrote. “If his daily shout-out was ridiculously low, and I had some spare cash, I would buy his farm. If the number he yelled was absurdly high, I could either sell to him or just go on farming.”
“Owners of stocks, however, too often let the capricious and irrational behavior of their fellow owners cause them to behave irrationally,” he wrote. “Because there is so much chatter about markets, the economy, interest rates, price behavior of stocks, etc., some investors believe it is important to listen to pundits -- and, worse yet, important to consider acting upon their comments.” Buffett has said that he regrets not taking advantage of such irrationality to sell holdings. Coca-Cola Co., one of Berkshire’s largest equity holdings, was one of the billionaire’s most successful investments in the 1990s, reaching prices that were more than 45 times earnings at the end of 1998. The investment has fared worse since then. While the stock price has recovered most of its losses since falling from the 1998 peak, Coke’s price-to-earnings ratio is less than half of what it once was.
Despite that regret, Buffett reiterated his view today that excessive trading can diminish returns. “Both individuals and institutions will constantly be urged to be active by those who profit from giving advice or effecting transactions,” he wrote. “The resulting frictional costs can be huge and, for investors in aggregate, devoid of benefit.” Berkshire last week decided to stop letting high-speed traders purchase direct access to press releases distributed by its Business Wire unit. Such firms often enter and exit positions in less than a second. Buffett said last year that such activity is “not contributing anything to capitalism.”
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