Monday, 10 August 2015

Stomach Churning Volatility : My Constant Companion

I have discussed many times on my blog about my no holds barred approach to EQUITY investments.  As an ERE (Early Retirement Enthusiast) I need to give my networth the best opportunity to increase during the accumulation phase of my working career.  The fervent hope in this asset allocation strategy is that equities are the best way to build up a corpus.

However, there is a high price that comes with a high risk portfolio that is heavily skewed towards equity investments. Obviously it is the highly volatile nature of the stock markets, that cause this risk, and the distinct possibility of suffering significant losses during market downturns. In this post I want to focus on the magnitudes of these swings and what it means to my portfolio in terms of gains and losses. We will use some back tested data, using historical index information

Tuesday, 4 August 2015

Portfolio Building: My Case Study

I am a confessed Early Retirement Enthusiast & I have blogged about my approach to retirement through Early Financial Independence. Saving & Investing for retirement is a good endeavor, something that most folks get serious about in their 40s in preparation for their golden retirement years into their 60s. However, the Early Retirement Enthusiast gets started much earlier, and typically takes on larger risk during the accumulation phase of their careers to amass the necessary corpus to enable financial independence at a much younger age. There is a strong emotional aspect to this journey, and I typically don't blog about my thoughts and feelings on that front. Here is an attempt at sharing with you how the emotional roller coaster ride feels like, as I approach financial independence.

Monday, 3 August 2015

Who is Wealthier? Uncle Scrooge or Donald Duck

My kids love watching cartoons. They are glued to the TV when their favorite cartoon characters are on, laughing along merrily at their silly antics. Of course the cartoon shows these days are very different from the ones I grew up watching. The favorites in my house are Chota Bheem and his gang, Kisna and friends, and Ben10 and Transformers. These cartoon characters are a lot more adventurous and get into more amazing mischief, than I could ever imagine. In our times, for one there was very little content developed purely for the Indian audience (except for Mowgli the Jungle Boy, and maybe a couple others). Also cartoon episodes would be much simpler unlike the ones today which have more elaborate and complex storylines.  So for this blog post, I figured I would use some old cartoon friends to discuss wealth as a concept. You will find other resources on the Internet, that describe wealth in this fashion, but what better way to remember a concept than through cartoons?