Yesterday I posted about the equity investor knowing basic accounting. Add basic math and stats to it too. He needs to be able to compute ratios, see trends, see how the stated strategy is being reflected in the accounts...Today I am going to write about some more things a good equity investor should know.
There are two levels of asset allocation that we need to be aware of. The first is the financial plan level asset allocation that encompasses asset classes such as equity, debt, liquid assets, gold etc. This is normally called the first level of asset allocation.
Some of the greatest mathematical minds of all ages, from Pythagoras, Euclid, Leonardo of Pisa and the Renaissance astronomer Johannes Kepler, Roger Penrose, have spent endless hours over this simple ratio and its properties.