Friday, January 7, 2011

What did he really mean by volatile and choppy?

I was reading Today yesterday evening and I saw one of those seminar advertisement.  In the small colored space was a claim that the speaker had correctly predicted the nature of 2010's stock market - volatile and choppy. I pity the fool who believes everything he reads in the newspaper, what more marketing paraphernalia.

However, I am writing this post because I really wonder what was meant by volatile and choppy because in my post not so long ago, I worked out the volatility of the Straits Times Index. Traditionally in finance, volatility is taken to be the square root of the variance of returns from a financial assets. Standard deviation is the term. For those who read that post and saw the second chart, you would have realized that the variance for 2010 was "visually"lower than 2009, 2008, 2007. Maybe the seminar company was just recycling an old advertisement!

Interesting corporate developments
My time is running out, got to get to work soon. But there has been a rash of interesting corporate developments. Stratech Systems proposed to acquire a company to be satisfied by USD1.2million cash and a large amount of new stock, GMG Global has said that shipment from Ivory Coast has resumed; an executive director in Action Asia has continued selling his stake in the open market; the subscriber of Asiatic's convertible bonds has exercised his right to converting new shares; MayBank's takeover of Kim Eng helped boost UOB-Kayhian's share price by the most amount in the longest period of time.

There you go, off to work!

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