Awesome Book – review on www.kobo.com

 Review of the book along with ***** rating

Awesome Book

Bible for investors, in fact this is a must must must read for all who are new , invested and expert. This book should be referred each year to refresh memories of Booms followed by Busts. A must book for all persons who wants to understand investor behavior across market cycles. The teaches us how not lose money. Highly Recommended.

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Seeking your views about the book

Those of you who have read my book “Riding The Roller Coaster – Lessons from financial market cycles we repeatedly forget”, may I request you to spare some time and write a small review, please? You may do one or more of the following:

  1. If you have bought the book from an online store like http://www.amazon.in; you may go to the respective store’s site, log-in and write your review on the book’s page
  2. You may create your profile on http://www.goodreads.com and write a review on the page for this book
  3. You may write a review and send me an e-mail
  4. You may write a review, post it on any of the social media sites and send me a link
  5. If you are a blogger, you may write a post regarding the book
  6. If you are associated with media, and if it possible, you may write a book review and send me a link

Looking forward to your support.

Thanking you all in anticipation

Amit Trivedi

knowledge is very important when you are investing … writes Anup Bhaiya

Another book I read recently is ‘Riding the Roller Coaster: Lessons from Financial Market Cycles We Repeatedly Forget’ authored by Amit Trivedi. As the name suggest it gives us various lessons on business cycles. The book is spread across the 5 centuries involving 4 continents. It covers the market hysteria, the trading bubble and the subprime mortgage crisis. The author has decoded the complex subject into simple language. The book has taught me that one should not predict the market. Secondly, knowledge is very important when you are investing in a particular product. If you do not understand the product refrain from investing in it.

Read the full text here

Do you know the future?

It amazes me how frequently the same questions keep coming back.

Some of the most common questions are:

  • “Which mutual fund schemes are the best according to you?”
  • “Which is the best mutual fund? Or best stock? Or best investment?”
  • “What is your view on the market?”
  • “Should I invest now or wait for some time?”
  • “I have invested in ********* mutual fund scheme(s). How much returns should I expect?”
  • “I have invested in ********* mutual fund scheme(s). Are these good schemes or do I need to make any changes?”

All the above questions have one thing in common – an attempt to know the future. It seems the entire business of investment management may be about predicting the future. And the investment expert is a professional forecaster.

The fact is, most have failed to correctly predict the future events – even the best of the investors. Let us see some examples and we need not go too far in the past. In the last seven months of the year 2016, the world witnessed three major events taking place in three different parts of the world.

First in the month of June, the people of Britain voted for exiting the Eurozone during the referendum, whereas majority had predicted that Britain would remain in the Eurozone.

On November 8, while many experts were expecting the US to get the first ever lady President, the result was very different.

In both the above cases, while there were only two possibilities, the actual result was exactly opposite of the popular opinion.

On the other side of the world, on the same day, November 8th, the currency notes of Rs. 500 and Rs. 1,000 were pulled out of circulation. I am sure nobody had any idea about this. No forecaster could predict such an event happening.

Continue further on the US election results, majority of the market experts and economists had expected that a Trump victory would spell disaster for the US. What happened in reality? Post the announcement of election results; the US Dollar has gained against almost all major currencies of the world. Can someone say that the fall of the Dollar was already factored in the price and hence post the victory of Donald Trump, the Dollar only recovered? Well, even that argument does not hold water, since majority was of the view that Hillary Clinton would win the election. There was no question of the unexpected being factored in the price. So, it was not a case of a political forecast gone wrong, but also a market forecast going wrong.

Sir John Templeton has famously said, “Buy value, not market trends or the economic outlook.”

The subject of investment management for most retail individual investors is to ensure enough money is available at the time of one’s life’s financial goals. In such a scenario, one must manage the investment risks such that the money becomes available at the time of need.

For that purpose, the important thing is to understand what can go wrong and how to protect one’s investments. Forecasting the future is not required.

  • Amit Trivedi

The author runs Karmayog Knowledge Academy. Recently, Amit has authored a book titled “Riding the Roller Coaster – Lessons from Financial Market Cycles We Repeatedly Forget”. The views expressed are his personal opinions.

#RidingTheRollerCoaster

Another testimonial for the book

“It has always been a treat to hear from Amit Sir. One can just keep reading it over and over again. The book Presents the concepts and market events in lucid manner. It is engaging and insightful.” Writes Neeraj Sundarani on http://www.amazon.in

What back-testing does not tell …

Once again, a superb post by Ben Carlson.

10 Things You Can’t Learn From a Backtest

Those who love back-testing data should take the results with a pinch of salt.

One line that I liked the most in this post is “Unfortunately there is no such thing as a front-test.” And add to it the disclaimer from mutual funds “past performance may or may not be sustained in future.”

#RidingTheRollerCoaster

 

You can’t direct the winds, but you can adjust the sails

“You can’t direct the winds, but you can adjust the sails” – this is one of my favourite lines and I have used it in the book. Here is a brilliant post highlighting the same message:

Adjust your sails …

It is also the same as understanding what you can control and what you cannot; and then focusing all your energies on controlling what is in your control.

#RidingTheRollerCoaster