2008 December | WhereDoesAllMyMoneyGo.com

Conspiracy Theories about Investment Managers on TV

Posted by Preet on Dec 30, 2008 | 3 comments

Following yesterday’s post about the great website Stockchase.com in which I mentioned that a cynic might suspect an investment manager might give away free stock picks for dubious reasons… Here’s a conspiracy theorist’s short list of some strategies one might use: Pound the table on a stock because they already bought it and it’s been going down and they want to pump the price up before dumping it. A case of hot potato. Espouse staying away from a stock at all costs, recommend selling it if you have it. Why? So they can pick it up more cheaply. Scream the sky is falling – because they have many short positions. On another note...

How Good Are The Guests on BNN?

Posted by Preet on Dec 29, 2008 | 8 comments

BNN, the Business News Network, is Canada’s flagship investment channel. There is a seemingly non-stop supply of guests appearing on the show sounding incredibly smart and well-researched, providing free commentary and recommendations on stocks to the channel’s faithful callers. They Sure Look Smart It would be hard to find people more well versed in many of the stocks they comment on, but you have to ask yourself a few questions as to if and how you should act on the information that is being doled out. A cynic would suggest that if they are giving away free information, it’s either not that valuable or they are hoping people will act on their comments...

Boxing Day Sales Don't Seem Cheap After Returning From India

Posted by Preet on Dec 28, 2008 | 0 comments

Fiona and I returned from India on Boxing Day and we had a fantastic time. I will probably miss the food the most – I ate like a king and had some of the most amazing food I’ve ever had. Our cab took us past Yorkdale mall on the way through Toronto and as you can imagine the parking lot was full, there was even a backlog on the offramps to get to the mall parking lots from the highway! Of course, the increased mall traffic is due to all the Boxing Week sales when many retailers are trying to clear stock to make way for the 2009 lineups – deals are a-plenty and there are a lot of good deals to be had… …unless you’ve just been to India...

Happy Holidays

Posted by Preet on Dec 22, 2008 | 2 comments

Just a quick note to wish everyone a happy holiday season. I’m travelling to Delhi tomorrow and will be there for the next 5 days and then it’s back to Canada. I don’t know if I’ll have access to a computer or not, so just in case I don’t I’ll mention now that I will take a break from blogging until I return to Canada. If I happen to get to a computer, then I might throw up some more quick posts but no promises… :) Thanks for reading and welcome to all the new subscribers in 2008! I hope you stick around in 2009 because it should get a lot more exciting with more giveaways (and bigger ones too!)… oh yeah, and hopefully you e

Quadruple Witching Days on The Stock Markets

Posted by Preet on Dec 21, 2008 | 0 comments

Quadruple Witching Days occur four times every year and are thought to have the potential of causing higher than normal volatility. Of course, these days “higher than normal volatility” takes on a special meaning. Mark Wolfinger pointed out earlier on his blog that the market (US market) had 22 days where there was a 5% swing in price during the two months of October and November alone. To put this into perspective, this only happened 27 times between 1950 and 2000, a span of 50 years. Mark sourced the information in turn from a blog on Time Magazine’s site. But I digress. A quadruple witching day is when you have a number of exchange traded derivatives...

An Example of How Performance Chasing Damages Wealth

Posted by Preet on Dec 20, 2008 | 0 comments

Yesterday’s post explained the difference between time-weighted returns and dollar-weighted returns. If you read between the lines you’ll have noticed that negative excess returns of dollar-weighted returns over time-weighted returns would indicate a proclivity to performance chase by investors. Some interesting data comes from Russel Kinnel who examined both the time-weighted returns and dollar-weighted returns of various mutual fund categories (US data), through April 2005: Dollar-Weighted 10 Year Return Official 10-Year Return Difference Large Value 9.60% 10.02% -0.40% Large Blend 7.46% 9.05% -1.59% Large...

Time-Weighted vs Dollar-Weighted Returns

Posted by Preet on Dec 19, 2008 | 8 comments

Still in India, but I have access to a computer ever now and then so it thought I would keep writing! Unfortunately, Fiona has been a bit ill – I think we both got a bit of food-poisoning, but it’s hit her harder than me. The rest of the family are off to Ranthambore on a tiger safari, but Fiona and I are still in Jaipur – not to worry though, as I’m getting some quality time with my aunts! :) Time Weighted Returns When you see the return of mutual funds, it’s important to make a distinction between the time weighted return which is similar to what is reported on performance charts and the dollar-weighted returns, which represents what...