Why is CAPM not CRAP?

What is CAPM? Capital Asset Price Model of 1961 says that expected return on any portfolio (or stock) should earn a premium above the risk free rate. In simpler words it said, low risk meant lower return and vice versa. The CAPM was introduced by Jack Treynor, William Sharpe, John Lintner and Jan Mossin, building [...]

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RMI India Active 10 Feb

After you select the RMI model which fits your risk preference, the key question investors ask is “How should one come on model?” RMI Models are customizable for any risk preference and do not suffer from starting point bias. So it can be customized from wherever you begin. The RMI India Active 10 initiated in [...]

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IBB Nasdaq Biotech up 100%

  There are various ways to select a big sector winner. Any sector ETF investment which delivers more than 30% over 12 to 24 months can be considered a big winner. We can adopt various tools and techniques to do so; inter-market analysis, macro economic analysis; sentiment analysis or we can look at the RMI [...]

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BRIC Model from a Japanese Perspective – II

This was a paper first presented at the EAECS Asian workshop in Kyoto Sustainability and Future Perspectives of Emerging Markets,  Kyoto Institute of Economic Research in 2009 by Ioan Alin Nistor and Mukul Pal. In the 2009 paper we illustrated that relative performance was cyclical. We used a simple indicator to illustrate a relative performance [...]

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The Predictive Bias

The Predictive Bias In case you got the annual forecast wrong, don’t punish yourself. The recent publication by Jason Hsu suggests, “2013 was not the year for Nobel worthy investment ideas”. If the Nobel prize winners can have a poor annual forecast, does forecasting accuracy need to be re-understood and re-defined? CAPE Failure Index dividend [...]

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Orpheus’ Solutions Indexing: The Market Capitalization Methodology was first developed probably 150 years ago. Mr. Axe and Ms. Houghton were the first to build the Axe Houghton Index. Charles Dow’s work came later, sometime in the 1880s. Market capitalization methodology has been challenged globally for a few broad reasons. Why? First, because it gives more [...]

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