It's the weekend!
Grab a cup of coffee, in this thread I will explain
1. What is a Yield Curve?
2. Why is it an important indicator of Recession?
3. Is an Economic Recession around the corner?
Lets dive right in!
A bond is a fixed income financial instrument which represents a loan made by an investor to a borrower
The investor typically receives payment in the form of interest and a lumpsum (principal) on maturity
The interest rate on a bond is known as coupon rate.
1. Zero Coupon : Pays both interest and principal at maturity
2. Sovereign Bonds : Issued by a Government or a Quasi Government Institution
3. Corporate Bonds : Issued by corporate like banks, established companies etc.
The higher the credit worthiness of the issuer, the lower the coupon rate
Credit Rating on a Bond is usually assigned by credit rating agencies like Moody's or Standard & Poor's (S&P)
Anything with a credit rating of BBB (Triple B) or lower is considered as 'junk bond' or a 'high yield bond' as they have high risk of default
Yield is simply the return an investor of a bond realizes over the course of the bond holding period
Bond Yield = Interest Payments / Bond Price
Since, coupon (interest) payments on a bond along with tenure of a bond is fixed
your yield on a bond simply depends on the change in its price
The logic and concept followed for calculation and estimating a Dividend Yield can be directly applied to a bond yield as well.
ITC as per its policy issues out 85% of its profits as Dividends to its Shareholders, this comes to around ~Rs 10/share
When ITC was trading
at 180/share, the Div. Yield was 5.5%
at 254/share, Div. Yield is 3.93%
If Bond Price come down, the Yield on the bond will increase
Suppose if you buy a 10 year Govt Bond that pays 5% interest yearly for Rs 1000
If instead of selling the bond when bond price rises to Rs 1100, you held on to your bond until its maturity date till end of 10 years
A Yield Curve is just a graphical representation of Yields of various bonds with similar credit rating but differing maturities
which depicts the Bond Yields on US Treasury Bonds for varying maturity dates ranging from 1 Month to 30 Years
Why is Yield Curve used to predict a Recession?
a. Upwards Sloping (Most of the Time)
b. Flat (Rare)
c. Inverted Yield Curve (Very Rare)
Yields on longer term bonds should be much higher compared to Yields on shorter term bonds
as
with longer term bonds you are taking more risk and hence need more interest as return
implying that near term risk in the economy is higher compared to long term
Bond Investors start dumping their short term bonds in favour for longer duration bonds
Demand for Short Term Bonds decreases, causing Bond Prices to collapse and Yields to Increase
While
Demand for Longer Term Bonds Increases, causing Bond Prices to rise and Yields to Decrease
Thus, creating the inverted Yield Curve.
Here are some of their publications on this subject
https://t.co/exRUKrkeYi
https://t.co/7dvY2PQOwE
https://t.co/iqxbeaqJg4
It even inverted right before the pandemic!
Most recently the US Treasury 2 and 10 yr Yield Curve Inverted on 29th March 2022
imply the onset of a recession anytime between end of 2022 to 2024.
Without Recessions, we wouldn't have the opportunity to reset and economy would overheat and turn into a bubble which when popped could bring depression.
1. Slowing Economic Growth
2. High Unemployment Rate
3. High to Medium Fed Interest Rates
The inflation today is purely a result of supply side shortages cause by the onset of the pandemic
I don't know and I am not sure if anybody does.
I hope you've found this thread helpful. Follow me @itsTarH for more.
Please Like/Retweet the first tweet below if you can: https://t.co/2zDVPC7lus
It's the weekend!
— Tar \u26a1 (@itsTarH) April 2, 2022
Grab a cup of coffee, in this thread I will explain
1. What is a Yield Curve?
2. Why is it an important indicator of Recession?
3. Is an Economic Recession around the corner?
Lets dive right in! pic.twitter.com/7qrYbT6Scj
All my previous work, can be found here
https://t.co/LV5EyiqlCw
All my Threads so far \U0001f9f5 \U0001f447\U0001f3fc
— Tar \u26a1 (@itsTarH) June 5, 2021
https://t.co/3OwTRkY8BZ
Here is a 5 hour long webinar on Green and Renewable Energy ☀️
Lots of India, Chinese and US companies covered along with Global Demand and Supply scenario
https://t.co/rkiK2iHlS0
More from Tar ⚡
Guess the Sector, that this company operates in.
ROCE 1 Yr: 32.7%
ROCE 3 Yr: 24.8%
ROE: 27.4%
ROE 3 Yr: 19%
Op Margin: 28.4%
Reserves: 32% of Current Market Cap
Debt: Nil
Profit CAGR 3Yrs: 54%
Debtor Days: 15
Inventory Turnover > 5
CFO YoY Increase : 160%
Some of you got it correct. Its Anjali Portland.
The company just acquired another cement company that will double the total sales immediately.
https://t.co/2xVnpJapPy
The acquisition was financed by adding debt, so interest costs from next quarter will go up but still great!
For a company that operates in a cyclical sector like cement!
What I liked is that the company was able to maintain the balance sheet and margins even in a down cycle.
With real estate sector reviving, this can be a great bet from here.
No recommendations, just an observation.
Market started re-rating the stock as soon as they announced acquisition.
Someone did some work on details of acquisition, sharing the thread
ROCE 1 Yr: 32.7%
ROCE 3 Yr: 24.8%
ROE: 27.4%
ROE 3 Yr: 19%
Op Margin: 28.4%
Reserves: 32% of Current Market Cap
Debt: Nil
Profit CAGR 3Yrs: 54%
Debtor Days: 15
Inventory Turnover > 5
CFO YoY Increase : 160%
Some of you got it correct. Its Anjali Portland.
The company just acquired another cement company that will double the total sales immediately.
https://t.co/2xVnpJapPy
The acquisition was financed by adding debt, so interest costs from next quarter will go up but still great!
For a company that operates in a cyclical sector like cement!
What I liked is that the company was able to maintain the balance sheet and margins even in a down cycle.
With real estate sector reviving, this can be a great bet from here.
No recommendations, just an observation.
Market started re-rating the stock as soon as they announced acquisition.
Someone did some work on details of acquisition, sharing the thread
@drprashantmish6 @Investor_Mohit
— Arun Choudhary FCA (@YOUNGBRUJ) July 9, 2021
1) Information on cement sector in India
India at 550 MTPA is the 2nd largest cement producer globally. Expected to move to 650 MTPA by 2025E pic.twitter.com/GqtcSk03TU
Its the weekend!
Grab a cup of coffee, today I will tell you about all the tools and services I use in my investing journey
Some are free, some are paid but all of them are guaranteed to deliver value
Lets dive right in!
Service # 1
Name: @Regulation30
Type: Paid
Regulation30 is my go to source to hunt for exchange filings that are worth studying further
This is also the source where I get lot of special situation ideas that aren't that widely known
Every day thousands of filings are made over the exchange, among them only a handful are worth studying
Regulation 30 filters out the noise and sends me a daily email of every exchange filing that is worth reading
Here is a snapshot of the email they sent me yesterday
Apart from the newsletter, there is a Slack community where founders of Regulation30 routinely share great insights into less known companies
Service # 2
Name: CapTwist
Type: Free
Wouldn't it be cool if you could search across all exchange filings of all companies via keywords or phrases and join them together as a theme?
Well, CapTwist does just that!
https://t.co/9mwFRPZkws
Grab a cup of coffee, today I will tell you about all the tools and services I use in my investing journey
Some are free, some are paid but all of them are guaranteed to deliver value
Lets dive right in!
Service # 1
Name: @Regulation30
Type: Paid
Regulation30 is my go to source to hunt for exchange filings that are worth studying further
This is also the source where I get lot of special situation ideas that aren't that widely known
Every day thousands of filings are made over the exchange, among them only a handful are worth studying
Regulation 30 filters out the noise and sends me a daily email of every exchange filing that is worth reading
Here is a snapshot of the email they sent me yesterday
Apart from the newsletter, there is a Slack community where founders of Regulation30 routinely share great insights into less known companies
Service # 2
Name: CapTwist
Type: Free
Wouldn't it be cool if you could search across all exchange filings of all companies via keywords or phrases and join them together as a theme?
Well, CapTwist does just that!
https://t.co/9mwFRPZkws
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To people who are under the impression that you can get rich quickly by working on an app, here are the stats for https://t.co/az8F12pf02
📈 ~12000 vistis
☑️ 109 transactions
💰 353€ profit (285 after tax)
I have spent 1.5 months on this app. You can make more $ in 2 days.
🤷♂️
I'm still happy that I launched a paid app bcs it involved extra work:
- backend for processing payments (+ permissions, webhooks, etc)
- integration with payment processor
- UI for license activation in Electron
- machine activation limit
- autoupdates
- mailgun emails
etc.
These things seemed super scary at first. I always thought it was way too much work and something would break. But I'm glad I persisted. So far the only problem I have is that mailgun is not delivering the license keys to certain domains like https://t.co/6Bqn0FUYXo etc. 👌
omg I just realized that me . com is an Apple domain, of course something wouldn't work with these dicks
📈 ~12000 vistis
☑️ 109 transactions
💰 353€ profit (285 after tax)
I have spent 1.5 months on this app. You can make more $ in 2 days.
🤷♂️
I'm still happy that I launched a paid app bcs it involved extra work:
- backend for processing payments (+ permissions, webhooks, etc)
- integration with payment processor
- UI for license activation in Electron
- machine activation limit
- autoupdates
- mailgun emails
etc.
These things seemed super scary at first. I always thought it was way too much work and something would break. But I'm glad I persisted. So far the only problem I have is that mailgun is not delivering the license keys to certain domains like https://t.co/6Bqn0FUYXo etc. 👌
omg I just realized that me . com is an Apple domain, of course something wouldn't work with these dicks
THE MEANING, SIGNIFICANCE AND HISTORY OF SWASTIK
The Swastik is a geometrical figure and an ancient religious icon. Swastik has been Sanatan Dharma’s symbol of auspiciousness – mangalya since time immemorial.
The name swastika comes from Sanskrit (Devanagari: स्वस्तिक, pronounced: swastik) &denotes “conducive to wellbeing or auspicious”.
The word Swastik has a definite etymological origin in Sanskrit. It is derived from the roots su – meaning “well or auspicious” & as meaning “being”.
"सु अस्ति येन तत स्वस्तिकं"
Swastik is de symbol through which everything auspicios occurs
Scholars believe word’s origin in Vedas,known as Swasti mantra;
"🕉स्वस्ति ना इन्द्रो वृधश्रवाहा
स्वस्ति ना पूषा विश्ववेदाहा
स्वस्तिनास्तरक्ष्यो अरिश्तनेमिही
स्वस्तिनो बृहस्पतिर्दधातु"
It translates to," O famed Indra, redeem us. O Pusha, the beholder of all knowledge, redeem us. Redeem us O Garudji, of limitless speed and O Bruhaspati, redeem us".
SWASTIK’s COSMIC ORIGIN
The Swastika represents the living creation in the whole Cosmos.
Hindu astronomers divide the ecliptic circle of cosmos in 27 divisions called https://t.co/sLeuV1R2eQ this manner a cross forms in 4 directions in the celestial sky. At centre of this cross is Dhruva(Polestar). In a line from Dhruva, the stars known as Saptarishi can be observed.
The Swastik is a geometrical figure and an ancient religious icon. Swastik has been Sanatan Dharma’s symbol of auspiciousness – mangalya since time immemorial.
The name swastika comes from Sanskrit (Devanagari: स्वस्तिक, pronounced: swastik) &denotes “conducive to wellbeing or auspicious”.
The word Swastik has a definite etymological origin in Sanskrit. It is derived from the roots su – meaning “well or auspicious” & as meaning “being”.
"सु अस्ति येन तत स्वस्तिकं"
Swastik is de symbol through which everything auspicios occurs
Scholars believe word’s origin in Vedas,known as Swasti mantra;
"🕉स्वस्ति ना इन्द्रो वृधश्रवाहा
स्वस्ति ना पूषा विश्ववेदाहा
स्वस्तिनास्तरक्ष्यो अरिश्तनेमिही
स्वस्तिनो बृहस्पतिर्दधातु"
It translates to," O famed Indra, redeem us. O Pusha, the beholder of all knowledge, redeem us. Redeem us O Garudji, of limitless speed and O Bruhaspati, redeem us".
SWASTIK’s COSMIC ORIGIN
The Swastika represents the living creation in the whole Cosmos.
Hindu astronomers divide the ecliptic circle of cosmos in 27 divisions called https://t.co/sLeuV1R2eQ this manner a cross forms in 4 directions in the celestial sky. At centre of this cross is Dhruva(Polestar). In a line from Dhruva, the stars known as Saptarishi can be observed.