14-01-2014, 03:20 PM
(This post was last modified: 14-01-2014, 03:26 PM by specuvestor.)
What Gautum has described is a very viable long term strategy of asset accumulation. Problem is not many of us has Buffett kind of patience. Cashflow also gives you optionality of deploying cash without selling the asset, and also reduce your risk to that asset
Please see my post #21
(13-01-2014, 10:43 PM)wahkao Wrote:(06-01-2014, 07:11 PM)specuvestor Wrote: Variance drain sounds so chimp. Basically it is that upside and downside returns are asymmetricyes this problem exists. Is there a solution?
A stock lost 50% and gain 50% does not go back to par. That's why absolute return strategy makes sense
what should we do about this situation?
Please see my post #21
(14-01-2014, 12:44 PM)arriyana Wrote: Most funds can borrow at ~2-3% interest rates, hence with returns of 4% dividend, they profit 2% without real capital.This is not a riskless arbitrage trade... alas from LTCM to CDO crisis, some people thought it is.
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Think Asset-Business-Structure (ABS)
Think Asset-Business-Structure (ABS)