Vegetables vs. GDP
Its almost 2025 but here we are...
The third installment of our trend-following series is up on Zerodha Varsity: Could Trend-Following Be A Successful Trading Strategy? (Part III).
Trend-following is often trivialized by “serious” fund managers. However, there is more to it than drawing lines on a chart. Hope DIY readers of this letter are deriving some value out of this series.
Markets this Week
Will poor GDP numbers throw the kibosh on this week’s Indian shitco recovery?
More here: country ETFs, fixed income, currencies and commodities.
INR depreciating 13% against the USD in three years doesn’t get enough press thanks to RBI’s “boil-the-frog” volatility management program.
Links
Research
Calendar Anomalies: A Portfolio Approach (pm-research, alphaarchitect)
This study evaluates the calendar-anomalies-based active portfolio strategies. The negligible difference in the annualized returns for day, date, and month portfolios suggests that calendar-anomalies-based portfolio strategies do not generate superior returns for a particular day, date, or month portfolio. This study concludes that, contrary to popular belief, calendar anomalies do not exist in the US and world market indices.
Design choices, machine learning, and the cross-section of stock returns (SSRN)
We fit over one thousand machine learning models for predicting stock returns, systematically varying design choices across algorithm, target variable, feature selection, and training methodology. Our findings underscore the critical impact of design choices on machine learning predictions.
Effects of Recreational Marijuana Laws on Exercise and Nutrition (NBER)
We find that the passage of recreational marijuana laws led to an increase in the number of grocery store trips that involved “junk food” and led to a decrease in exercise, particularly driven by a reduction in cardio.
Investing & Economy
India
India's economic growth slowed much more than expected in the third quarter, hampered by weaker expansions in manufacturing and consumption. GDP rose by 5.4% in July-September year-on-year, the slowest pace in seven quarters and below a Reuters poll of 6.5%. In the previous quarter it grew 6.7%. (reuters)
The RBI will eventually cut rates once vegetable prices come down because everybody ran out of money.
Microlenders wake up to hangover after credit party (livemint)
Cash transfer schemes for women are now prevalent in over 10 states—including in Karnataka, Jharkhand, Madhya Pradesh, Tamil Nadu, Odisha and West Bengal. The schemes are estimated to cost the states between 3 and 11 percent of their revenues and add up to over Rs 2 lakh crore by some estimates. (newindianexpress)
Turning steel into fool’s gold: The reverse alchemy of Sanjay Singal (livemint)
row
China Flexes Its Sanctions Muscle (thewirechina)
China Has a New Playbook to Counter Trump: ‘Supply Chain Warfare’ (nytimes)
Chinese Carmakers Are Trouncing Once-Unbeatable Japanese Rivals (bloomberg)
How China Became the World’s Largest Car Exporter (nytimes)
GM and other US automakers would take big hit from Trump tariffs (reuters)
Marine Le Pen might be about to wreck the eurozone (politico)
Odds & Ends
Every single country in the Western world now has a TFR below replacement, along with much of South America, North Africa, and Asia, particularly Northeast Asian countries. The single best predictor of a country’s fertility rate is its level of affluence. Once a country crosses the threshold of $5,000 USD in GDP per capita—the wealth of a country like Indonesia—it starts the journey towards sub-replacement fertility. And those whom affluence loves most—the urbanized, the secular, and the educated—are those it sterilizes most aggressively. (firstthings)
Lab leak most likely source of Covid (telegraph)
Meme of the Week
