Its the end of the third semester exams out here at SCMHRD for the people of the 07-09 batch. All those who are destined to be MBAs by 2009 must be cursing themselves for so many different reasons. Some for being born at the wrong time of the business cycle (Poor souls, they never even knew of a bicycle by then. How the hell would they have known of a B-Cycle?!!) and some others for quitting work and joining a B-School at the wrong time. All this because of the innate ability of the Harvard grads out there in the Wall Street who made sure such a thing never ever existed. All those who were earlier proud of associating themselves with the WALL are now running away from it. The world's largest economy is down and it has not just gone down alone but carried all the others along with it.
Coming to the scene out here at SCMHRD, its a little cheerful still for the final placement season hasn't yet begun. Everybody is sitting out there thinking that the Placements Team will find an 'Ideal Match' for them. Its only when the mela begins that the true standing is likely to be exposed. All those who earlier were thinking of Options, will now be faced with a situation in which they'll be forced to take whatever comes their way first. Definitely, this is not the time to wait and speculate. Just like they say in Finance, whenever you have an exposure, go hedge it. Dont just wait and speculate expecting the market to move in your favour! Right now, I've set myself Stop/Loss & Stop/Greed levels and am still to enter into a hedging contract to anul my risk completely. This I'm doing because of the bad experience that I had during my summers selection process. At that time I was completely down and had given up so early into the fight that I simply took what others had left out. The first semester results had not come out by then and the entire selection was happening on the basis of the same CV which was used by the college for giving admission into the college. My CV had nothing good in it except for the decent academics, which most other CVs on campus had too. I had made-up my mind that I was not one of those gifted souls who was made to be an Investment Banker or an Equity Research Analyst. All this for sheer lack of confidence.
This time though, I wish the scene to be different. Though the market situation is a little glum, I have grown in confidence. All this could be attributed to my better performance in college, plus the extra effort that I'm putting-in to prepare for the International CFA exam. To add to the pain, I'm having to go to Kathmandu to give the exam. Let me tell you, all this has left very deep and huge holes in my pockets.
Hence, the moral of the story is that I expect to make atleast some positive NPV out of the whole exercise, irrespective of the cost of capital that I'm incurring. I wont say I have used leverage to make more gains on my investment but the bottomline is to atleast preserve the Initial Investment from getting eroded because of the market downturn. I'm no expert in managing hedge funds or mutual funds or any portfolios worth millions but I think I've learnt my bit of International Finance and hence am hedging my risks with whatever contracts that are available in the OTC markets!
Cheers!
