Moneyterms Blog

Blogging elsewhere

I am experimenting with moving my investment blogging back to my main blog.

More people seem to read my old posts there, than my recent posts here. Feedback on whether it is a good idea is welcome.

Mandelbrot, what is wrong, and a solution

Richard Beddard’s post on a recent FT two part interview of Benoit Mandelbrot focuses on his comments on Bachelier and the efficient markets hypothesis. (more…)

How analysts go wrong

Earlier this year, a Credit Suisse research note on Google caused a furore by suggesting that Google was spending huge amounts to pay for Youtube’s bandwidth usage. Now people have realised their mistake, and we now see articles saying that Google’s bandwidth bills are zero. Both are wrong. (more…)

More on the Raj Rajaratnam insider trading case

A few quick thoughts, following on from my previous post: (more…)

Investment styles for market phases

Richard Beddard recently looked at chart produced by Morgan Stanley showing which investment strategies are suited to each market phase (bull. bear etc.), and, quite correctly, commented that he did not think it possible to anticipate changes is market phase well enough. I think Richard underestimates the dangers of Morgan Stanley’s suggestions, and I think that there is a better alternative that I have suggested before. (more…)

What next after Raj Rajaratnam’s arrest?

I am not going to comment on the details of, or have no intention at all of commenting on the guilt or innocence of the accused in the insider trading case centred on Raj Rajaratnam. What I am interested in are the wider implications. (more…)

Black-Scholes isn’t

According to a paper co-authored by Nassim Nicholas Taleb, Black and Scholes (along with Merton) are wrongly credit with originating the widely used option pricing formula, and their version of the formula is inferior to its predecessors in many ways. (more…)

London Stock Exchange’s acquisition of Millennium IT

The London Stock Exchange seems to be getting a bargain with its purchase of my former employer, Millennium IT. The price of seems justified by the savings from replacing the current (expensive to run) platform, and, in addition it is a better platform and Millennium IT itself is a potentially significantly profitable business. (more…)

Best disclosure ever in financial statements

New Zealand has given us what may be the most unwittingly transparent set of accounts ever: (more…)

The best crunch prediction yet

I have blogged before about who did, and who should have, foreseen the credit crunch. Brad Delong has a lengthy quote of Michael Musa, that is the best pre-crunch explanation of what went wrong that I have seen yet. (more…)