Is it worth it ??

There is always a feeling of lowness in this part of the calendar year when most of the numbers are out and the earnings call of various companied start to pour in. In-between the numerous meeting and page over page of valuation writeup of visit –review notes and strategic plans some time you feel like a joker in a circus playing his part for some measly peanut butter jam.

I was in a similar state of mind when I came up on this article by Toughee who regularly comes up with some brilliant piece. So here is one from the recent post that most of the Investment Banking pros might take a feel to.

“I still wasn’t convinced, until Bob whispered in my ear what I would make in the first year. It was about three times what I was paid at Bell Labs. I stopped protesting so loudly. He then said “And that’s for being right just 51% of the time,” Andy Kessler recounts in his book, Wall Street Meat - My Narrow Escape from the Stock Market Grinder. Kessler was a rank outsider on Wall Street, having come in as a semi-conductor analyst.

Now, what exactly is the role a stock analyst fulfils? At a very basic level, an analyst is supposed to have an opinion on the stock that helps investors make a decision whether to invest in that particular stock. But it is not as simple as that.

“Companies report earnings once a quarter. But stocks trade about 250 days a year. Something has to make them move up or down the other 246 days. Analysts fill that role. They recommend stocks, change recommendations, change earnings estimates, pound the table - whatever it takes for a sales force to go out with a story so someone will trade with the firm and generate commissions,” writes Kessler.

And what does it take to become an analyst on the Wall Street? “Let’s start with the basics. First, there are absolutely no qualifications whatsoever for an analyst job. I’ve always thought that a monkey could do the job, and many do. There are very few analyst training programs, and no obvious way to get a job as an analyst. Most are in the job by accident, as I certainly can attest to.” he writes.

Over time, Kessler was able to form an opinion on analysts in the business. “By watching other analysts in action, I figured out there were three types of analysts. There are: 1) those who know somebody in their industry, 2) those who know their industry and 3) those who don’t know anybody or anything. Lots of analysts had industry contacts - perhaps CEOs who they were buddies with or someone in the CFO’s office who was feeding them information.”

So, how do analysts who really do not know their industry survive? As Kessler writes “Though I was starting to be right on my stocks, I was increasingly convinced it didn’t matter. I looked around the research department, and noticed that very few analysts were right about anything. The job of an analyst has more to do with impressing everyone they come in contact with, and less to do with stocks. At one meeting I had with Fred Kittler, a portfolio manger at JP Morgan, he paused, looked me in the eye and said, “You realise, you are not in the analysis business, you are in the entertainment business.”

So ultimately you end as a burn out chasing Alpha for somebody. Ultimately one fine Monday morning there is a pink slip waiting for you just after you come in from your Honeymoon.

This is a typical Investment Bankers life..phew

Chess Widget

Trying out a chess widget on my Blog ... A sudden bend to use technology !!
Lets see if this works out


Looks some thing is wrong with the code... Hmm got to find some help..

A new feel

Its Aadi season and you have lot of offer on the cards. So I thought why not an Aadi offer for my blog. It has been a total neglect for a long time , so though of dust up the blog and included a new counter and global tracker to add that extra fizz.

That's not all we have more in store ... Couple of earlier blog rolls that I have in the HOT links have been pruned and fresh ones added. Of the new ones that I have added are Nasia and Arthi’s blog. These ladies give a whole new perspective and are quite a regular blogger so you have a thing or two other from them.

Nikil and Lijo have been moved out while Sara and SK find a place in. Nikil and Lijo have been a bit tight as the new found workplace firewalls are a hindrance to their creative side. So to compensate I have included Sara who is bound to bounce you out of your chair and SK with his SK-ism will kindle your grey cell to the extent that you won’t suicide.

Rohit has been maintained as I feel that he is bound to make a come back, I feel his job at Fever FM takes away most of the waking hours. Let me check if his mobile blog is up.

Also have added couple of investment blog to bring us back to monetary world.Couple of them mind sound too techie but I suggest that you stick on and keep reading and sure it will grow on you.Most of try and avoid money matters but a small dose of this kinda reading will be of sure help in the road ahead in life. This I hope will stand you in good stead and possibly so that you wont fall for the ULIP misselling that some advisors might come up with even without asking what your risk profile is !! phew

Yeah! you must be hungry after reading all this so to pep up things have included couple of food blog as varied as American, Continental and Indian American.

Hope you will like the new blog roll.

Can I have some Serotonin please

Most traders want to excel in their trades. It is the unwritten rule of the capital market game. It is also to increase the pie for the proprietary account or the client account. Which ever way the market moves the trader needs to be on top.

Not all traders are aggressive and as in any field you always have the so called laggards. It is always good to be the top of the line metro sexual alpha male.

It has always intruded me if I can find out what kind of mentality these people possess at the work floor by following some of the common and often ignored traits that people display at the work place. A few pointers on this.

Talk: If the person is extremely loud and talkative. You might very well find that they are aggressive in the field and the anxiety brings them to be very loud to get things across to the other pesron. Being loud can be taken as a symbol of authority. More often when there is no one to question you. A more subtle and non-aggressive person on the other hand is bound to make a softer landing approach and in a more unhurried manner.A relaxed approach is bound to have more safer than rough handling.

Walk: In a similar manner the most of the aggressive person more around quickly as the time that they have is not enough or at least thats the signal that you tend to get across. It is make or break at any moment for these kind of people.The cool cat trader on the other hand takes his time and is more risk averse and is more often found leaning towards the safer side. This type have a good risk management in place that at the slightest hint they wind up the position. Even thought the upside is unlimited the down side is also limited.

We can immidiatly figure out when a aggresive guy have fallen out of place. There will be a sudden breaking effect that shows up. You can feel that extra bit of lethargy in place with the person.The area becomes gloomy as the sound bytes die out. The way things shape up the unlimited risk would have hit like thunder bolt out of the blue.So if you could watch out you can probably see it coming.

So it if you get a chance do check this out and let me know the results. Well you make ask what Serotonin has got to do with behaviour.Well higher level of Serotonin plays a very important role in your behaviour pattern. A time is not far away when we can have it as a pill !!

I am a Bearish

We folks have a fancy for bear market or slightly bearish trend like what happened y’day.

This fall of 600 odd points on 01-Aug had couple of us cheering away. (No man no drinks. We want to stay sober) You could have found a some of us egging the index to fall a bit more !! A scene that is hard to believe after the tremondous bull run that we have had.Else where on the floor we found couple of folks squaring of long positions in frenzy as they had been caught on a wrong footing. Poor folsk hope they did not loose their shirt.

It is hard to make money unless you have a pretty good call on where the market is heading.Typically we late night owls keep an eye on the DJ (Dow Jones).With the rising market it was bound to fall anyways. But the key point was when it will break free.On 30-July the DJ was flat until the last hour of close. Then there was this sudden free fall of about 100 odd points.

So,the next morning we had this sell trigger and keeping a close eye on the Asian markets confirmed the call.So couple of our folks ventured into selling the Nifty future and needless to say had a windfall gain. Unfortunately for our gang who did not have the financial muscle to get into position in a very short period this was a big opportunity loss.But never the less we liked the bear operators having fun a lot.

But the silver lining was that I was harping on a Put option with couple of like minded folks for a couple of weeks.I had expected the market to correct before the July expiry. But it seems the market was waiting for smoke signals from across the globe. So any one who has had taken a August In-the-money Put option would have seems a good notional profit right now.

So how will the market go from here.Well I am waiting for the BOJ (Bank of Japan) policy.If they raise the Interest rates by another 25 bps then Will suggest to take buy another Put option expiring on Sep as the cumulative effect of FII winding up positions will have a chain reaction that can be seen here. Typically we can see the fission type reaction in about a month from the BOJ announcement i.e in case we have a rate hike. Other wise it will be neutral to slightly bullish.

Hope the BOJ raises the interest rates!!

Contrarian Bet on the YEN !!

Please find here the link to a article on the YEN.

Truly makes a interesting read for those in the money market.

Shall we short the NIFTY August??

Behind the screen happening in the a typical PG

Hi,

I found a interesting write up by Nasia.

http://exaggerration.blogspot.com/2007/07/this-ones-going-to-be-long.html

The post captures in graphic detial the behind the screen happening in the a typical PG....

This is a typical arm chair Psycho-analysis; correct me if I am wrong…,
Ppl do make the significant other more importance for the amount of affection that one gets and craves for. Suddenly you feel you are no longer wanted in the world and take the desperate measure. So it is the withdrawal symptom that springs from loneliness that makes certain ppl to get lost and bunch into such desperate activities to win over or show their loyalty.

Love hotels- A New Adventure

“Love Hotels” Emerging Opportunity?!

There is a chance that our Indian investors might get enticed in this venture as it is very lucrative. With a majority of Indian population in the youth segment we are ideally poised to get into the love hotel industry with the boom in real estate and property development boom.

I believe this is an ideal opportunity for Finance profesionals to get into with Structured products suited to cater to the varied investor class.In this way we can reach out to the retail class to grow. In recent years, and as Japan continues to change, the love hotel business has drawn the interest of the structured finance industry. Several transactions have been completed in Japan where the cash flows from a number of hotels have been securitised and sold to international investors and buy-out funds.

Love hotel is ideally suited for amorous couples who want to spend time together. Rather than get hardon in public places likes beaches and parks this kind of facility offers ample scope and more privacy. This is already a hit in the Asian countries like Japan,Korea and Taiwan with lot of investors showing appetite for these emerging opportunities.

In the concrete wasteland of the modern Japanese city, the love hotel stands out as a refreshingly off-the-wall escape from conformity, a monument to hedonism, and a libertine's paradise.Love hotels are right there from budget to the swanky in Japan where in every need of the customer is taken care of. These kinds of boutique or fashion hotels are easily identifies by there different looks. With the right ambience and soothing atmosphere customers are bound to have a whale of a time. More over the quick turnover ratio brings in more profitability as the rooms are not occupied for more than 2 hours. So this translates to higher rental and better margins for hotel owners.

The above hotels provide total privacy .

A closer view will let you know that there are no windows(left pic) and provide multiple entry exit points(right)

A typical overnight cost about 8000 yen which can shot up during weekends. A surprise is that there is no visible receptionist for that added comfort zone. Ocupancy rate are known to zoom during festival times and Christmas and New year are great excuses to jump on from romantic dinners to Love hotels. Guest choose room by selecting the available rooms themselves and pay to a invisible person. Rooms vary from pink cadillac to Romantic reds.However strange the theme may be a Love Hotel caters to the requirement.

This can lead to high cost in the intial stages which can be recouped as the theme cathces fire.So a well advertised theme will sell well.More over themes need to be changed to capture the attention on the season.

But the cons factor is that this is a high risk area and this can lead to cartalisation by the organized crime gangs. This can affect a hotels reputation which can potentially drive away customers. This can be more suitable for BIG guns with the right connections. More over it depends on the the law of the land to allows such kind of open culture as it might seem "against customs and ethics"

So given the current sentiments that prevail the opportunity is beckoning but the risk far out-weighs against the pros.

What about the so-called "family values" crowd harping about morality?

Hey, the mindset here is if you're old enough to pay, you're old enough to play.

**This article is mainly for information sake**

**This writer has sourced information fromthe web solely for knowledge dissemination sake.Not for profit**