Of course, investing in a  good mutual fund through a Systematic Investment Plan (SIP) is a no-brainer and I believe the corner stone of every portfolio (especially if you do not have the time to micro-manage your portfolio) should start there. However, I also believe it’s possible to augment returns from mutual funds through investing in stocks directly or through derivatives.

Which brings me back to the fundamental question – is there a fairly “sound” system for getting into the stock market and exiting profitably? From the little I know about the field, most academic research has been done in the “value investing” school of thought i.e. investing in stocks that are trading at less than their intrinsic values.

So I decided to investigate this further by building a “paper” portfolio of value stocks. I chose Benjamin Graham’s Net Current Asset Value (NCAV) per share as the criterion to filter stocks.  The NCAV per share is calculated as per the formula below:

What the NCAV per share effectively indicates, is a “realistic” cash value that may be available to the shareholder once all liabilities have been met.  Graham recommends buying stock that trades at approximately 67% or less of the NCAV per share. A study by the State University of New York has shown that investors could have earned an average return of 29.4% over a 20 year period, by picking stocks by this method and holding them for a year.
Once the filter criterion was decided on, I needed a universe of stocks to choose from. For the universe of stocks to choose from, I restricted myself to the stocks that compose the BSE SMALL CAP index (which also served as my benchmark). I then ran a series of scripts that I wrote in Ruby to pull the data needed to calculate NCAV from Yahoo Finance. Once I had all the data in a spreadsheet, I calculated the NCAV for all the stocks.
While Graham recommends only picking up stocks that trade at values significantly below their NCAV, I chose to go with stocks that were trading at prices that were at the NCAV or below it. Using this filter, I got a portfolio of about 17 stocks. The next step in my opinion should have been either of the following:

• Use the Markowitz optimum portfolio theory and allocate a fixed amount of capital among the stocks chosen so as to minimize portfolio risk OR
• Do further fundamental analysis (which most investment “gurus” recommend) and pick only those that are “fundamentally” strong

However, since I was pressed for time – I took the easy way out.

I just created a “paper” portfolio containing 100 shares of each stock. Slightly “unscientific” I know, but bear with me.
So with this small little NCAV portfolio – I began tracking the performance of the portfolio. And the results have been interesting, to say the least.

NCAV Portfolio Performance

The portfolio has significantly outperformed the benchmark over the last month. The returns from the benchmark BSE SMALL CAP index have been about -2.14% while the portfolio has returned about +9.09%.
While I agree that the time period is probably a bit short for significant analysis, I think the results warrant further investigation. Over the next few months, I will actively monitor my little test portfolio and update this blog. Lets see how it goes.

The last time I had tried Ubuntu, it was a rather bitter experience. My graphics card wasn’t fully supported and Ubuntu refused to show anything but a blank screen!! This time round though it was delightful experience.

Like I said earlier, Linux has come a long, long way and I was completely bowled over by the ease of installation. I had thought openSuse represented the zenith of “easy” Linux installs. Ubuntu is way up there and even does openSuse one better. The pain free install is further complimented with a beautifully integrated system and some serious gorgeous eyecandy effects !!

Here are my impressions after playing round with the Meerkat for a few days:

• Boot times are extremely quick. Definitely several times faster than my creaky old Vista Install and also my previous OpenSuse install. Ditto for shutdown
• Hardware support is better by leaps and bounds over what I had seen with previous versions. My graphics card seems to be well supported with no need for any additional driver installation. In addition to this all the other hardware bits and pieces (wi-fi, bluetooth etc) work properly. Even the custom volume controls on my old Dell Inspiron were supported, to my delight.
• Software installation is several shades better than the older “apt-get” systems that I was used to in older versions of Ubuntu. Though for the normal user, you might not even need to install any additional software. The default install comes fully loaded with Open Office, Firefox, Shotwell Picture Manager, Empathy IM, Evolution Mail, Transmission BitTorrent client, Gwibber Social, Rhythmbox and Movie Player to name a few. Adding more software is quite simple using the Software Center and its possible to find replacements for most Windows programs.
• Ubuntu has a very slick and refined UI (see above screenshot). Gone are the orangish shades of previous versions, replaced with new slick black theme. I particularly like the window transitions and the switching between desktops. The manner in which all the elements are integrated together is just awesome !!!
• Ubuntu is also social and resides in the cloud. I love the way they have integrated social networking and email right into the OS. Its very usable and gets the user going almost immediately. In addition to that, Ubuntu One, Ubuntu’s “cloud” service is supposed to bring dropbox like capabilities to the OS. An very intriguing concept, albeit one I am yet to try out.

Overall my take is that Ubuntu Maverick Meerkat is a fairly mature, stable and user friendly operating system. One that should find favor with both novices and old hands. (Also my primary OS for all intents and purposes going forward)

And I haven’t come to the best part as yet – Thanks to the “live” CD provided, you don’t need to install it to use it, just boot from the CD ROM drive and run along with the Meerkat. Go on, what are you waiting for? Run with the Meerkat today !!!

So far we have added features that let you calculate the correct fare for both Taxi’s as well as Autorickshaw’s in Mumbai. In addition to this, you can also calculate the correct midnight fare for journeys after 12:00 midnight. In case you have a problem with the autorickshaw, you can call the toll free helpline started by the RTO, right from the application itself.

I am pretty excited about this application, and we do have a lot of more nifty features that we will roll out soon (including our entry into the Android Marketplace). Please do use the application and let me know how you liked it or why you didn’t like it and what features/improvements we can add in future versions.

PS: We are also on Twitter, so please follow for updates.

Cheater Meter

I have been a bit busy of late, so its been a while since my last post. What have I been up to of late ? Well not much other than “work” and a few pet side projects.

One of them materialized very recently as a result of a hike in the autorickshaw fares in the city. Earlier, one could calculate the fare payable by the simple formula of (10*meter-reading)-1. Life was good, but noooo… the autorickshaw unions had to go on strike to demand a raise. Following a very successful flash strike, the government relented and hiked the administered price to Rs.11 as the base fare for the first 1.6km and Rs.6.5 for every km thereafter. The result? Well other than the increased cost of an auto ride, the painful mental math needed to calculate the correct fare. In this case (13*meter-reading)-2.

This got me thinking – Could I somehow make it easier for me to calculate this on my phone? So I got round to creating a simple android application for the phone (tentatively called cheater meter).

The result is a fairly nifty app that lets you calculate the fare payable for both autorickshaws and taxi’s, created in record time over two evenings (pats self on back). I’m still working out a few kinks in it and it should be coming to an app store near you soon. There will also be a web app for all the non android phones out there (in collaboration with my good pal Aditya). Watch this space for more.

After much pondering I decided that what I was really looking for was a phone that featured a camera, could play music (with a radio), surf the internet, get me on twitter etc on the go, allow me to install apps, show my location using GPS + maps and maybe allow me edit documents.  The first phone that came to mind was the iPhone, but in my opinion it was way overpriced at about Rs.33, 000 (I could replace my desktop I think for that price, plus I’m no fan of Apple’s pricing and for how it treats its users). Initially I had narrowed down to either a Nokia 5800 or Nokia E72. Both phones had most of everything I wanted and were a lot cheaper than the iPhone. On a whim I decided to check out what android phones were available in the market, and after much thought I narrowed down on the Samsung Galaxy Spica.

What’s in the box?

The Spica comes with a charger, USB data cable, Stereo hands-free kit, Software disc and a nice leathery case for the phone.

Hardware

The Spica comes with a gorgeous 3.2” TFT screen that is only slightly smaller than the iPhone screen. It has a capacitive touchscreen, and I can attest that it is highly responsive. The Spica is powered by an 800MHz processor which in my experience has been able to speedily handle anything that has been thrown at it so far. The phone features four main buttons for taking calls, hanging up the phone, pulling up the menu and for exiting options/ apps on screen. In addition to this it has a four way controller with an OK button in the center of the key arrangement and dedicated keys to bring up search and the home screen. On the sides it has volume control buttons, screen lock key and a dedicated camera button. The top of the phone has the headphone jack (standard 3.5 mm) and ports for USB connectivity. Overall it has a nice solid feel about it.

Connectivity

The phone comes equipped with Bluetooth, GPS, wi-fi and a digital compass. Bluetooth can by default only pair with Bluetooth capable devices. However it seems that downloading an app from the Android marketplace will enable file transfers. Ditto for the digital compass, there is no app for that in the phone. I wish Samsung had pre-installed an app for the compass. I haven’t yet tried out wi-fi on it, but I imagine it should be snappy. Lastly the GPS is quite quick. I was able to get a quick lock on a satellite and pinpoint my location on the map pretty fast.

Software

Twidroid on the Spica

Spica runs Andorid 1.5 (Cupcake). However Samsung is currently in the process of releasing an Andorid 2.1 (Éclair) firmware update for the phone, which means that this humble phone will soon be running the latest Android OS. The phone comes pre-installed with the standard Google apps like GTalk, Gmail, Google Maps etc. All the Google apps synch with my online accounts exceedingly well. It also has some social apps like MySpace, Facebook and Orkut installed.  I also downloaded a few apps from the Android Market for Twitter, Evernote, a few games etc. I have been pretty happy with them so far. My only grouse is that it comes with just 200 MB of memory, which seems a tad less for installing apps. While it’s true you can expand the memory to about 32 GB using the SD card slot, I am given to understand that you can’t run apps off the SD card without “rooting” the phone.

Browsing on the phone is a pleasure. The pages load exactly like on a PC browser (wherever mobile versions of web pages aren’t available). You can pan across the page, zoom out and zoom in on a particular part of the page quite easily. In fact this morning, the browser came to my rescue. I had set up a ruby script on my server for some research work that I was doing and suddenly realized that I need to set up another script. I could log on to net2FTP, copy the script, make changes to it and then log on to my server control panel and set up the cron task all from my phone browser!!

The Spica has three customizable home screens on which you can add shortcuts, widgets etc. The Éclair update is expected to expand the number of screens as well.

And the best part – the much vaunted multi-tasking does work!!! I have often clicked on a link in Twidroid and then switched back to it while the page loads in the background. It works very well, though I suspect it does play havoc with battery life. More on that later.

Camera

The phone has a decent 3 mp camera. The camera is without flash and in well lit conditions it takes fairly good photographs with accurate color reproduction. However in low light situations it doesn’t have stellar performance.

Sample Photograph

Multimedia

The Spica can play MP3’s on its installed multimedia app.  In addition to this it can apparently play DivX movies right out of the box, without any need for conversion. I haven’t played either of them so far so I can’t comment on the quality or performance of the device in this area. The phone however does not have a radio. I did think of using Pandora on it, however it turns out Pandora isn’t available in India.

Battery Life

Now this is something I am not very sure of. Thing is while I don’t really have many calls, maybe a maximum of 15-30 minutes in a day, I have however really played around with web apps. I have found myself checking twitter every 20 minutes or so, chatting on GTalk as well as checking mail frequently. In addition to this, thanks to multi-tasking most apps remain open even after you seemingly exit them. This is possibly to bring up the app faster when you use it again, but it does drain the battery. So with all this tinkering around and having GPRS/EDGE on all day, I have found that the battery lasts little over 2 days. Whether this is good or bad, I really don’t know because I don’t have a frame of reference.

To sum up, I think the Spica is good phone. It has pretty much catered to all the requirements I had of a phone and done admirably well in every aspect. If you are looking at getting a smart phone, I’d definitely recommend it.

Oh, I forgot the best part, it’s cheap!!! It cost me about Rs.12500 or about one third the cost of an iPhone. I’ll leave you with that thought for now.

Social Media and Crime from SMC Mumbai on Vimeo.

Apple’s iPad which released a few days ago promises to change the way we read digital books. Armed with a 9.7” touch screen display, it certainly looks capable of doing so. In comparison, the e-ink powered readers, like Kindle, look like black and white silent films in a color talkie era. But will the iPad really deliver on its promise?

Well there is no easy answer to that. I think it falls somewhere between yes and no.

While a number of commentators and analysts have been raving about how the color screen is what e-books have been waiting for, I think they are missing the point that most of the books published are predominantly black and white. So having a color screen isn’t really going make that much of a difference for standard fiction and non-fiction books. It’s true that you are going to get fabulous 3-D page turns, page backgrounds and all that other jazz, but given a choice between charging a device after reading say a book or two (10 hours) to practically charging the device once or twice a month, I think I would prefer e-ink any day, more so if I was going to use the device only as an e-reader. (In spite of the perceived shortcomings of e-ink devices that the press keep raving about) .

What’s going to really matter is readability – meaning how long can you read off the screen before your eyes tell you it’s time to do something else. Having read extensively off LCD monitors in the past, I know how painful it can be to read for long on normal screens. E-ink on the other hand remains a pleasure to read from, and so far I have had very low eye fatigue. So what remains to be seen is if the iPad’s LED display will match up to e-ink in terms of readability.

I also think that the iPad’s higher weight is going to pose a problem in curling up with the device to read on a lazy Sunday afternoon. I don’t know if it’s going to be possible to hold the device in one hand (like a book) and read for extended periods of time. In fact many people already complain that they have problems doing this with the considerably lighter Kindle.

Lastly, Apple has an uphill battle to get quality content for its device. It’s the one area where Amazon has a stranglehold on the market and it’s one of the most important reasons for Kindle’s runaway success. Of course, all this only matters if Apple intends to make its iBook platform a success. If it merely intends to drive device sales through books, then it probably would be better off surrendering this battleground to Amazon. Amazon’s Kindle app for the iPhone (and now hopefully iPad) already has access to 400,000 Kindle titles and its adding a lot more to the list every day.

Now that I have brought out the areas where I think the iPad could have trouble in, let’s look at the areas in which the iPad can be a game changer.

For starters, looking at the wonderful color screen of the iPad, the first thing that comes to mind is comics!! Imagine reading your favorite DC or Marvel comic on that screen or curling up with your favorite graphic novel on the iPad. I think this is the one area that Apple can seriously make its own. Currently, digital comic book distribution is in its infancy. It’s a market without a tested delivery model as yet. Thanks to this, there is a burgeoning shadow file sharing market, especially for out of print comics. Die-hard fans have often scanned entire comic book series in an effort to popularize their own forgotten heroes. However, due to the colorful medium of comics, this hasn’t yet translated to the B&W e-book readers. This means that with the right kind of tie-ups, Apple can possibly do for the comic book industry, what it did for the Music Industry with iTunes and the iPod. I think reading comics on that big piece of glass is going to be a great experience. With multi-touch, navigating multi-panel scenes is gonna be a piece of cake.

By extension, as has been repeatedly pointed out, Apple can also make new ground in areas where color and layout are of paramount importance such as magazines, newspapers and textbooks. These are the type of books that will never translate well to the e-ink screen. They are also the kind of books that you would not ordinarily spend hours reading from (I know, what student wants to spend time on textbooks, right? ). This means that readability isn’t likely to be such a big issue for this kind of material. What will matter however is how Apple chooses to allow interactions with these kinds of books to take place. While active content embedded in newspapers, such as video clips and podcasts are a no-brainer, it would be really something if Apple lets users scribble notes on the screen, or highlight and underline important text.

Besides this, I feel that those of kind of books are also the ones for which Apple can get away with setting a much higher price point. Currently, thanks to Amazon’s aggressive pricing policy, customers have become habituated to $9.99 or less prices for fiction. In fact some of them have gone as far as to say that they wouldn’t buy anything priced higher. However, I think Apple might be able to get away with charging much higher prices for the kind of books that I mentioned, if it can deliver enhanced value on the back of its apparently superior technology.

In the end, like I mentioned in an earlier post, the iPad is a flawed device that does have tremendous potential and I guess time will tell if Apple plans on addressing some of the shortcomings of the iPad.

I know the slides don’t make much sense, so watch this space for the video for the event. I promise I’ll post that soon.

Also those of you that did make it to the event, please do feel free to comment and let me know what you liked or didn’t like about the talk.

Update – 24 February2010

Following a complaint by PhotoSadhu, I have modified the presentation to not include his photographs. I hope this satisfies him.

Here’s my take on the device – Appearances aren’t everything!! And everything seems wrong with it. I really don’t know where to begin, but I guess let’s start with the name. I pretty sure Apple has a lot of marketing whiz kids drawing six figure salaries and all they could come up with, is iPad? I think the alternatives tossed around like iSlate and iTab actually sounded better than iPad. iPad sounds more like a product line of sanitary napkins than a premium tablet computer.

Next up is the design. I have always admired Apple for the sleek, almost minimalistic design of its products. However, with so many design gurus at Apple, is this the best that they could come up with? The early mockup renders of the device actually looked better than the final product in my opinion.

But let’s not be too harsh and judge a book by its cover. Going a bit further, I am really surprised that Apple chose to use the iPhone OS without any upgrades. I mean you spend so much money on the device and then what are you reduced to – using one application at a time? Lack of multi-tasking is a serious drawback on a device like this one.

Jobs, in his presentation, claimed that the device would offer the best browsing experience ever experienced. Without Flash? Considering the widespread prevalence of Adobe Flash on the net, especially for streaming video on YouTube and several other websites, one wonders what kind of online experience you would have on the device.

The device also provides maps. But without GPS, using maps on the mobile device is practically pointless. Sure, you could “multi-touch gesture” your way to finding your current location, but what’s the use? I mean if you knew where you were in the first place, you wouldn’t really need a map now would you?

I can go on and on with stuff like a not-so-great virtual keyboard, lack of camera (would be great to use as a webcam) etc. (Did I mention it’s got no USB??) I think its biggest drawback is that it does no one thing properly. It messes up by trying to be all things to all people.

If you are a die-hard gamer (as opposed to a casual one) you are probably better off with a console or a handheld like the PSP or Nintendo than the iPad. I have no idea as to how multi-touch is going to replace a lot of complicated key combinations that today’s bestselling games use. So until there is some sort of revolutionary breakthrough, if you want to play the latest First Person Shooter, maybe the iPad isn’t for you. (Just realized though that multi-touch might do wonders for real-time strategy games)

If you want to surf the web and consume rich content like streaming video, lack of flash is going to seriously kill your online experience. Also you won’t be able to multi-task on the iPad, running e-mail, chat and maybe a twitter client along with your favorite music, as you surf. And wait, it just supports Apple’s video formats. So want to play all your media in other formats on the device? Forget about it, buddy! Not without converting it first. I guess you are probably better off with the laptop or netbook that you, in all likelihood, already have.

If you are a die-hard reader, reading more than a book a month, you are probably better off with an e-book reader that uses e-ink. The iPad does offer a rich “color” experience to reading, but it remains to be seen how that translates in long reading sessions. If my previous experiences with LCD screens are anything to go by, you may be in for some serious eye fatigue (I may be wrong here, and OLED may actually be good). Besides this, it will be some time before a wide enough selection of books is available for the iPad from official Apple sources. (Though you ought to be set if third party iPhone apps work on the iPad as advertised) Lastly the 10 hour battery life looks pitiful when compared to the two or three weeks that the current crop of e-readers give per charge.

And lastly, if you are buying it for the apps, I think you are better off with the iPhone/ Nexus One/ Palm Pre etc. I don’t think the larger screen will present significant advantages to running apps as yet. Nor do I think that the iPad platform presents anything unique that would make for a more compelling app experience. (Again I may be wrong, but that’s the way it looks like now)

The device will however appeal to those that don’t really indulge in the above activities and of course the Mac Fanboys. So for a casual reader, gamer, surfer etc. the iPad will probably be good enough. And I think that it’s this audience that Apple is targeting. So if you are a book lover that held out on all those e-book readers, hoping that Apple’s magical tablet will be just for you, I’m sorry pal but you’re out of luck.

In summary, I’d like to say that for me, especially on the e-reader front, the device was underwhelming. It certainly has things going for it and a lot of the points that I mentioned are fixable. It will be interesting to see how Apple addresses a lot of the early criticism of its device in the days and months to come.

I almost suffered a giant case of buyer’s remorse over my recently purchased Sony PRS-300. Then after a little while, reality set in and the rose tinted glasses dropped from my eyes. Looking at the features a bit objectively, I noticed the following:

• 3G doesn’t work internationally. Wi-Fi only works in B&N stores, none of which are in India.
• The lending feature sounds cool, but in order to use it you need friends with the same device. Something that I feel isn’t going to happen soon for me.
• The device’s second LCD is going to drain some battery power. But that is a minor concern I guess, as it is, even 10 days on a single charge is a lot.
• Biggest drawback, only supports ePub, eReader and PDF (or so the website says). What? No RTF, TXT, DOC ? A big fail in my opinion. Looks like B&N is only interested in having users of its device read DRM’d content on it. On a side note, I feel that the very model of E-book retail needs to change, but I’ll save that for another post.
• And since I don’t listen to audio books and would rather prefer a dedicated MP3 device instead of in-built MP3, MP3 support isn’t that big a deal.
• Ditto for the 2 GB storage and card expansion. Doubt I’ll ever use up 512 MB let alone the 2 GB storage.
• RSS support is apparently limited to what B&N wants you to read. No web support as of now. However, with Android as the OS, I’m sure this will change in the near future.

So all in all, I’m still all for my humble Sony PRS-300. As they say the best camera is the one you have with you when the action happens, similarly the best reader is the one you have currently. For me, I’m better off reading on the Sony Reader now than waiting till next year to get my hands on the Nook.