22 results for “Survivorship Bias”

Does a Governance-Event-Driven Valuation Discount Ever Go Away?

When a company goes through a governance event, its stock usually falls. Sometimes the stock price doesn’t recover, while other times it does. But, here is a more important question: when the price does recover, does it come back all the way? Read on to know what this means and why it is important.

Happy Diwali 2025! More Useless Predictions Even Though...

Every year, I make this folly of trying to predict what will happen in the next year. In the joyous occasion of Diwali, I celebrate by laughing out loud at my past predictions. Here's wishing you a great year ahead and some laughs for a year that's had both smiles and frowns. Read on for our 19th Diwali prediction post.

The WWII Bomber Puzzle: A powerful lesson for modern investors

Our recent article in The Economic Times reveals how survivorship bias can mislead investors. Drawing on the story of World War II bombers and statistician Abraham Wald's brilliant insights, we explore the dangers of focusing only on successful funds, companies, or strategies. Just as military commanders nearly reinforced the wrong areas of bombers, investors often chase 'proven' track records while ignoring the unseen failures. Our article provides actionable insights to help investors uncover true risks and build resilient portfolios. From managing liquidity risk to diversifying across asset classes, we invite readers to examine their own blind spots and take steps to protect against hidden vulnerabilities.

The Halo Effect: How success blinds us in Business and Investing

The Halo Effect is a cognitive bias that influences how we perceive successful companies and make investment decisions. In this article, we explore real-world examples from Lego and Byju's to illustrate the two faces of the Halo Effect and its impact on business narratives. Discover the lessons investors can learn from these cases and how to make more balanced decisions in the face of the Halo Effect. Gain insights from "The Halo Effect and Other Business Delusions" by Phil Rosenzweig, a must-read book for investors looking to navigate the complexities of business success and failure.

The enduring myth of Great Companies

The top three most popular management books have sold over 10 million copies worldwide. By studying great companies in depth, they decode what made them great and offer the repeatable formula to make any company great. Except it hasn't worked. The odds of the great companies profiled in those books outperforming the market in the subsequent decades were worse than a coin toss. The companies profiled by those bestsellers are living (or bankrupt) proof of why, as investors, we should take any claims of infallible greatness with a grain of salt.

Decoding 'Trending Value' in India: Insights from the investing classic 'What works on Wall Street'

What works on Wall Street by James O'Shaughnessy published in 1997 is the original quantitative investor's handbook. One of the strategies explored in the book "Trending Value" buys statistically cheap stocks showing relative price momentum. We applied the Trending Value framework to the Indian market and found it would have handily outperformed the index but with higher volatility and drawdowns. This post summarises the key findings from applying Trending Value in India.

Crossover Episode: Amit Varma X Deepak Shenoy talk about Creator Economy & Money Wise [Podcast]

. A Crossover Episode between Seen And Unseen Podcast by Amit Varma and the Capitalmind Podcast! Two friends, both of whom are old hands in the creator economy, much before the term “creator economy” existed.  They sit together to discuss a wide array of topics around the creator economy through their experiences and Deepak’s first book - Moneywise. And of course, they talk a lot about their personal experiences and life in general. - How their careers started and evolved - Journey Vs Destination - Goals Vs Processes - What does authenticity mean to them - First-hand look at the creator economy through their lenses - Discussing Moneywise - Deepak’s first book .

What makes Amazon, Amazon!

Amazon made $281Bn in revenue in 2019, up 20% from the previous year. That is the combined revenue of the top-5 revenue-earning Indian companies: Reliance, IOCL, ONGC, BPCL and SBI. A year later, in 2020, Amazon clocked $386Bn, growing 37%. Put another way, Amazon added 1.4 times the total topline of Reliance Industries as incremental revenue in 2020. Amazon and Jeff Bezos's decision-making framework is well-known. We tried to identify Indian companies that pass "The Amazon Test". Spoiler Alert: The results weren't pretty.

Podcast #33: Momentum Investing, Unintuitive yet Effective

In this episode of the Capitalmind Podcast we discuss what is momentum investing, the key research by academics and practitioners that started the exploration into this strategy, the two schools of thought that explain why it exists. How it applies to Indian markets, and our analysis into whether it has worked. Also the downsides of momentum, both real and perceived, and in what ways it can be a good counterweight to a bottom-up fundamentally picked portfolio. We close with how we manage the Momentum portfolio at Capitalmind, and the differences between the Premium and the PMS Momentum portfolio.

Does Momentum Investing work in India?

DSP Quant Fund NFO - Is it Worth Investing?

Guest Post: How Many Of Your Investments Will Survive?

Guest Post: What they did not tell us about long-term investing

Guest Post: A value investor’s experiment with momentum

Yahoo’s Year In Review

At Yahoo: The Legend of the Turtles

On Yahoo: Here Comes The Rally

At Yahoo: The Ministry of Mis-selling

At Yahoo: Mutual Fund Distribution

On Yahoo: Survivorship Bias

On Yahoo: Framed and Anchored

Anchoring Bias, Survivor Bias and Hindsight Bias