11. Position Sizing for active trader
11.1 – Poker face Last month I got an opportunity to play poker with a few good friends. I was playing poker after a gap...
10. Value at Risk
10.1 – Black Monday Let’s start this chapter with a flashback. For many of us, when we think of the 70’s, we can mostly relate...
9. Portfolio Optimization (Part 2)
9.1 – Working with the weights In the previous chapter we introduced the concept of portfolio optimization using excel’s solver tool. We will build on...
8. Portfolio Optimization (Part 1)
8.1 – A tale of 2 stocks We have spent a great deal of time and efforts towards understanding risk associated with a portfolio. Our...
7. Expected Returns
7.1 – Expected returns The next two chapter will be very insightful, especially for people who have never been familiar with portfolio techniques. We will...
6. Equity Curve
6.1 – Overview This is off topic – but a little digression hurts no one, I guess. Of all the chapters I have written in...
5. Risk (Part 4) – Correlation Matrix & Portfolio Variance
5.1 – Correlation Matrix In the previous chapter, we successfully calculated the variance-covariance matrix. As we discussed, these numbers are too small for us to...
4. Risk (Part 3) – Variance & Covariance Matrix
4.1 – A quick recap Let us begin this chapter with a quick recap of our discussion so far. We started this module with a...
3. Risk (Part 2) – Variance & Covariance
3.1 – Variance In the previous chapter, we touched upon the topic of expected return, continuing on it, we will understand the concept of ‘Portfolio...
2. Risk (Part 1)
2.1 – Warming up to risk For every rupee of profit made by a trader, there must be a trader losing that rupee. As an...