Benchmark (95 Marks in physics vs 93 Marks) Beta (less than 1) Alpha (Higher the alpha the better it is) Standard Deviations (Less is best) Sharpe Ratio (Higher it is higher returns we get) Only use in Equity MF Capture Ratio
Karthik rangappa is one of the Best guru of stock market and finance in India....his varsity is just amazing, even school children can understand it such a nice presentation....keep it up ,👍
So what's new with Zerodha varsity videos? Just take a look at the CAGR formula fiasco in their corresponding video for basic personal finance math🥵 Totally throws a newbie off and misinforms rather than informs. Even the sharpe ratio example is wrong. Fund B is clearly better even with the higher standard dev of 34 as its sharpe is 0.2941 while A's is 0.2857. I don't think there's a case for rounding as the fractions can be compared easily using basic primary level mental math without reaching for the calc.
Very useful info. One doubt. You said alpha = {(MFR - RFR) - (BMR - RFR)} × beta. So effectively this looks like (MFR-BMR)×beta (Basic algebra). So cannot find the significance of Risk-Free Rate here. Also in the given example, putting values in formula {(10-4)-(7-4)}x0.75 = 3x0.75 = 2.25 and not 3.75!!!!
Another mistake which I found today. In alpha calculation [(10-4) - (7-4)]*0.75 = 2.25 and not 3.75. Are you poor at math and just overwhelmed by oversight!!! Please review and then post.
Benchmark (95 Marks in physics vs 93 Marks)
Beta (less than 1)
Alpha (Higher the alpha the better it is)
Standard Deviations (Less is best)
Sharpe Ratio (Higher it is higher returns we get) Only use in Equity MF
Capture Ratio
Karthik rangappa is one of the Best guru of stock market and finance in India....his varsity is just amazing, even school children can understand it such a nice presentation....keep it up ,👍
Most appropriate video for mutual fund investors...many thanks for this series.
I think there is a mistake in the brackets. Correct calculation is:
(10% - 4%) - {(7% - 4%) x .75}
= 6 - (3 x .75)
= 6 - 2.25
= 3.75
So what's new with Zerodha varsity videos? Just take a look at the CAGR formula fiasco in their corresponding video for basic personal finance math🥵 Totally throws a newbie off and misinforms rather than informs. Even the sharpe ratio example is wrong. Fund B is clearly better even with the higher standard dev of 34 as its sharpe is 0.2941 while A's is 0.2857. I don't think there's a case for rounding as the fractions can be compared easily using basic primary level mental math without reaching for the calc.
So many fake fin-influencers selling their course and never gave this much in depth information
True!
Ca ranchana 😒
Very useful info. One doubt. You said alpha = {(MFR - RFR) - (BMR - RFR)} × beta. So effectively this looks like (MFR-BMR)×beta (Basic algebra). So cannot find the significance of Risk-Free Rate here.
Also in the given example, putting values in formula
{(10-4)-(7-4)}x0.75 = 3x0.75 = 2.25 and not 3.75!!!!
Yes there's something wrong here
I just noticed that the formula is correctly given in varsity textual module
Info Ratio(IR) is better metric with regards to Capture Ratio(CR) as it includes the Upside CR of any fund. Thus higher the IR the better the fund.
Thank you for these videos! Would love to see a video on Analyzing Debt Mutual Funds.
Equity n debt funds analysis are two different ball games. Plz be careful about the difference.
'The Black Swan' written by Nissim Nicholas Taleb explores some of these ratios in a very interesting & enlightening way.
Shouldn’t the Alpha be 2.25% ?
same doubt for me . i did the math and i got 2.25
Alpha = (10-4) - 0.75(7-4) = 3.75
The formula given is a bit wrong
Also wht is significance of risk free rate...because it cancels itself out.
{(10-4)-(7-4)} i.e. 10-4-7+4
So no significance of 4??!!
In the next video, while analysing the funds please consider trynor ratio also. Or let us know why you gave it a skip.
Hoooo
Hi Sundeesh, we wanted to cover basic ratios that most people can understand :)
Very nice video,
Just curious to know are you still in touch with those two guys.
Has the mindset changed or does it remains the same😊
Zillion thanks for all the commendable work.
is the calculation of 3.75% correct ? as per the formula it should be = 2.25%
Exactly my question
@zerodha varsity : please confirm calculation
formula presentation was wrong
The formula is
((Return-risk free return)-(benchmark return-risk free return)*beta))={[10-4]-([7-4]*0.75)}=6-2.25=3.75%
Downside capture ratio should be Minimum , so out if 100 what is the ideal number ?
Generally what is sharpe ratio value of good growth funds?
Karthick any trustworthy website where you can find all or most of the parameters readily ?
Where to find all these metrics in a single place in order to compare the funds?
Is there any particular website/app for it?
Money control app
Can you please make a video about CFA certification ? Like what are the opportunities and growth (especially for an engineering background)
Hi Shubham, we'll look into the posssibilities, thanks.
Down side capture should be less then 100 or more then 100?
Ho zerodha can you plz suggest if this measure can be considered for futur selection as the data used is historical return to calculate ratios..
Awesome share
What is risk free rate?
What about tracking ratio?
Thank you❤
I want to learn trading . I have 30k in my account currently . Can I start investing . If yes teach me how . Please do a class on it .
Hi Akash, you can start off by looking at this playlist :)
th-cam.com/video/GcZW24SkbHM/w-d-xo.html
@@varsitybyzerodhawhere are you from sir?
To be honest you can't trade with 30k , you need atleast 6 lakhs to start
Good, keep it up 👍
sir if alpha is negative is the fund investible if betta is less than 1
Sortino ratio?
🌱 Thank u sir .....
advance level research
Mast video 📹
Another mistake which I found today. In alpha calculation [(10-4) - (7-4)]*0.75 = 2.25 and not 3.75. Are you poor at math and just overwhelmed by oversight!!! Please review and then post.
Shouldn’t alpha be 2.25% in given example?
Hi, no. The calculation is (10-4) - (7-4) X 0.75 = 3.75
That means the second brackets (braces) have been wrongly put in the formula shown in the video (4:01).
@@varsitybyzerodha where are you from sir
Sorry tracking error
Equation is wrong
❤️❤️
Un necessary ba। ....ba no use, very hurry fast speeking
क्या आपको हिंदी नहीं आता 😔