Investing at its heart and soul is avoidance of the big loss.
We, at First Global, look at risk management as a central tenet of our investing process.
While there are quantitative ways to manage risk, this blog post, we want to talk about how to qualitatively manage risk in your portfolio.
Therefore, qualitatively speaking, these are the major risks that you should avoid in your investing journey.
"Storification" risk: when you build a nice story around your Investments, a story that you fall in love with. The risk increases even more when you tell others about this story, as this makes you want more emotionally invested in it.
"Concentration" risk: when you put most of your eggs in one or a few baskets.
"High Conviction" risk: when you get hyper convinced of your investment hypothesis and take large positions in your High conviction ideas.
"Investment Philosophy" risk: when you make some of your investing successes into an investment philosophy, forgetting that many successes in the stock market are random, and based on nothing but good fortune, or being in the right stock at the right time.
All the above are classic investing biases.
They create rigidities.
They reduce flexibility.
They make you emotionally invested in your holdings which make taking rational decisions that much more difficult.
Rigidity in anything is avoidable (except in Risk Management, that is).
Rigidity in arteries.
Rigidity in muscles.
Rigidity in thinking.
All completely avoidable, like plague.
We, at First Global, keep our Investment Strategy data-based. Situation based.
We have no rigid philosophy.
We adapt according to the changes in the markets, the developments in the world.
Marry these with Zero-emotion, System-Driven Risk Management.
That's the First Global Method.
More on our (Hu)man + Machine Investment Model in our subsequent posts.
From the desk of
Shankar Sharma & Devina Mehra
If you want any help at all in your wealth creation journey, in managing your Investments, just drop us a line via this link and we will be right by your side, super quick!
Or WhatsApp us on +91 8850169753
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Economists Think Dollar's Fall May Explain the Recent ‘Rally’ by Steve Liesman
Einstein taught us about relativity in nature. Now come Devina Mehra and Shankar Sharma of First Global to teach us about relativity in financial markets -- and raise some serious questions about just what is driving stock prices.
First Global reports are quite credible and, on occasion, more than that.
What prompts this mention is Intel's earnings report and the fact that First Global has had a pretty good bead on the company and its stock.
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Analyst Kuldeep Koul at First Global upgraded Advanced Micro Devices (AMD) to "buy" from "outperform," given the "exceptional traction" that the chipmaker's Opteron line of processors has been able to get.
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Baidu Inc., the operator of China’s most-used Internet search engine, rose to the highest price in two weeks after First Global rated the shares “outperform? in new coverage.
Personality counts: Walmart's frugal, but Target charms
"It's better to take a slight hit on [profit] margins and keep on moving and inventing," says First Global Securities. And at least for now, Target is inventing in a way that appeals to consumers with money to spend.
Dead Batteries
At 11 times trailing earnings, Energizer is cheaper; Gillette's multiple is 25. But cheaper doesn't mean better, says First Global.
Bipinchandra Dugam @bipinchandra90
@devinamehra @firtglobalsec
invested in both GFF-GTS and Super I50. Thank you very much for such wonderful investing experience with completely new approach. In my 15years of investing first product I felt which close to what customer want.
Shishir Kapadia @shishirkapadia1
@firstglobalsec @devinamehra
by far you are the best, I have not come across transparency, acumen, global expertise, exposure, protection of capital, delivering return from any fund/ fund managers. Invested very small size in 3 products will keep on increasing it over the period
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