@rgumental @dvisor

One of the electives that I took while in IIMK was this less fancied course - Complementary Products & Competitive Advantage  . The fundamental message in that course was in applying 'Platform Thinking' concept into a lot of situations . A platform could be thought of as an area where two or more types of consumers / producers join for their mutual benefit.  And the value of the platform grows as more and more consumers / producers join it.  Typical example of this is Card Payment networks - Visa & Mastercard.  So, if you are a card network provider,  merchants are forced to give that as a payment mechanism because consumers want that. And, more consumers joining the platform results in more merchants adopting it.  Like a domino / network effect. If executed well, it soon reaches a tipping point from where more consumers & merchants just adopt it. This concept could be extended to a lot of situations - Currency is a platform  ( explai...

To Hedge or Not to Hedge - That's the billion dollar question puzzling everyone from industry heads to govt policy makers in the wake of crude oil collapse . Before even attempting to answer that, it may be prudent to to look at the way indices work - and the economics behind it. What should a market index reflect ?  It should be a consistent & fair representation of the underlying supply & demand. Is that the case behind petro price indices ? Lets look at a few data points first. Globally, there are two main crude indices  - Brent & WTI . Brent crude index is computed as a mathematical function of spot & future prices of North Sea oil ( Click for details ) . Similarly, WTI or West Texas Intermediate is function of primary crude contracts settled in Cushing, Oklahoma . Both have different Sulphur content, density etc - which means there are different costs to refiners, though the end - market - Consumers is largely the same For most part of the last 5...