Sensex is a very wrong Benchmark for TED XI. I cannot recall the TED XI stocks but as far as i could remember, not many constituents of TED XI are part of sensex. I think something like a BSE 200 should be a better reflector......by the way, have you worked out the alpha of TED XI?????
Joined: 06/Sep/2006
Location: India
Online Status: Offline
Posts: 5966
Posted: 01/Jan/2008 at 10:31pm
Actually, I personally feel TED XI should compare itself to BSE MIDCAP when markets are upwards and should compare with the sensex when markets are falling. That way we would get a real good feel of how TED XI is doing.
Edited by omshivaya - 01/Jan/2008 at 10:33pm
The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
Joined: 01/Jan/2006
Location: India
Online Status: Offline
Posts: 18403
Posted: 01/Jan/2008 at 6:18am
Alpha is the incremental return that aportfolio makes when compared to the general index/ market that it is tracking. If markets go up by 30% and your portfolio does 35% then alpha is 5%.
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
Alpha is the incremental return that aportfolio makes when compared to the general index/ market that it is tracking. If markets go up by 30% and your portfolio does 35% then alpha is 5%.
I believe its the excess of your risk-adjusted return over the return thrown by the benchmark. The key thing is risk adjusted return and not absolute return. So, even if the portfolio may throw 500 p.c. but if the risk adjusted return is 25 p.c. , alpha will be negative.
Actually, I personally feel TED XI should compare itself to BSE MIDCAP when markets are upwards and should compare with the sensex when markets are falling. That way we would get a real good feel of how TED XI is doing.
Why so? Although I do adhere to the principle of prudence but unnecessary conservation distorts the picture. What we are looking for is the true and fair view and not the performance under worst case scenario.
Joined: 01/Jan/2006
Location: India
Online Status: Offline
Posts: 18403
Posted: 01/Jan/2008 at 9:00am
Right => The CAPM model.
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
You cannot post new topics in this forum You cannot reply to topics in this forum You cannot delete your posts in this forum You cannot edit your posts in this forum You cannot create polls in this forum You cannot vote in polls in this forum
Here's why members would love to be a part of theequitydesk.com
Equity Desk focuses on why to buy shares and invest in share rather than what to buy.
Live discussion forum wherein members can discuss the current Indian share Market trend,
BSE Sensex or the Nifty Index.
Have huge cache of information on Indian and World Share Market.
Analysis of Indian stock market, Global events, Investing insights, portfolio
management strategies and thoughts,
Meet investors from round the globe check their investing strategies share experiences and learn
for their experiences on stocks and shares, evaluate opinions on investing in India.
Active Topics
Memberlist
Calendar
Search
Help
Register
Login
IP Logged
