The eagerly awaited union budget will be released tomorrow.
You could see the hype created by the media. Its their job to do that and its your job not to get influenced by it.
Lot has been said about the budget and how it will impact the common man.
It is expected to be a populist budget and there will be many sops for the common man as there is elections next year.
I would like to mention a few things which will happen on the day
The past experience has shown that it will be a very volatile day and there will be large intraday swings. The companies which will be benefited and sectors will move up drastically
Expect fertiliser companies to move up a bit as there will be a push for greater subsidies or some sops
I expect some positive sops for the dollar hit sectors like textiles
Corporate tax is unlikely to be changed
Tax exemption limit for the common man may rise to 1.5lakh INR
Alternate energy like biofuels and ethanol may get a push
There will be greater focus on agriculture as it is the main laggard
Infrastructure will hog the limelight and i expect greater allocation
More emphasis on giving more credit for buying houses
These are few of things which are relevant. Once the budget is out and i read the fine print, i will update you all.
Thursday, February 28, 2008
Real v/s Reel expectations
Dear all,
I am sorry for the prolonged absence on the blog as I was caught up with a few personal issues.
My todays topic for discussion would be the expectation which one would have from stocks.
Firstly, i would like to categorize the investors into categories
1- The lambs- these are the innocent investors mainly retail and majority of them having no knowledge of the markets who are feed upon by the foxes. They are thrashed and straggled to death to never return again to the stocks
2- The hare- speculators mainly who are in need to quick money. Most of them are over leveraged and deal in Futures and Options only and proudly say it. They fail to realise that these trading instruments are mainly for hedging purposes
3- The tortoise- They are the lazy and defensive investors who would buy a stock for years on end rely on the dividend yields
4- The foxes- This is the most important category and includes operators, politicians, FII's and corporates. They feed on the lambs and the hares. They lure them into a comfort zone and before they realize the lurking danger, foxes pounce and make sure the stocks fall by 40-50% in value so that froth is thrown out.
Now one has to decide where one wants to be. A pro after many years can become a fox. But we will be looking to become something in between a fox and a tortoise.
So then what are the realistic expectations one should expect?
I think, one way to look at things will be as to compare the returns given by savings instruments like post office, bank FD or some government bonds. They give an average yearly pre-tax return of around 8-9%.
Through regular research and dedication, i think one can aim to 25% p.a in our markets which is nearly 3 times the returns provided by above mentioned instruments.
I strongly believe that our markets will enable you to earn 25% p.a compounded for the next 5 years atleast.
Before the fall happened, i was being mocked at by people who said they could become rich overnight. Some even say, the stock market is a gamble. I roll with laughter when some says that. It just shows how naive people are and sooner than later, they will also realise.
Also, there is nothing like fast money. The higher the stocks go, more they fall during a bear phase and people who mock and become rich overnight, become paupers.
At such times, these people should undergo lesson in proctology.
Happy investing!
I am sorry for the prolonged absence on the blog as I was caught up with a few personal issues.
My todays topic for discussion would be the expectation which one would have from stocks.
Firstly, i would like to categorize the investors into categories
1- The lambs- these are the innocent investors mainly retail and majority of them having no knowledge of the markets who are feed upon by the foxes. They are thrashed and straggled to death to never return again to the stocks
2- The hare- speculators mainly who are in need to quick money. Most of them are over leveraged and deal in Futures and Options only and proudly say it. They fail to realise that these trading instruments are mainly for hedging purposes
3- The tortoise- They are the lazy and defensive investors who would buy a stock for years on end rely on the dividend yields
4- The foxes- This is the most important category and includes operators, politicians, FII's and corporates. They feed on the lambs and the hares. They lure them into a comfort zone and before they realize the lurking danger, foxes pounce and make sure the stocks fall by 40-50% in value so that froth is thrown out.
Now one has to decide where one wants to be. A pro after many years can become a fox. But we will be looking to become something in between a fox and a tortoise.
So then what are the realistic expectations one should expect?
I think, one way to look at things will be as to compare the returns given by savings instruments like post office, bank FD or some government bonds. They give an average yearly pre-tax return of around 8-9%.
Through regular research and dedication, i think one can aim to 25% p.a in our markets which is nearly 3 times the returns provided by above mentioned instruments.
I strongly believe that our markets will enable you to earn 25% p.a compounded for the next 5 years atleast.
Before the fall happened, i was being mocked at by people who said they could become rich overnight. Some even say, the stock market is a gamble. I roll with laughter when some says that. It just shows how naive people are and sooner than later, they will also realise.
Also, there is nothing like fast money. The higher the stocks go, more they fall during a bear phase and people who mock and become rich overnight, become paupers.
At such times, these people should undergo lesson in proctology.
Happy investing!
Sunday, February 10, 2008
Listing Of Reliance Power
Reliance power, boasting of having the largest number of shareholders in the world, will list on monday the 11th.
With pathetic market conditions, the grey market premium has considerably come down for the company and there is expectation that it will list at around 600 odd levels.
Most of the HNI's are expected to cash out at 600 odd levels. The FII's are expected to hold on and ride the wave. All ADAG group stocks should do well.
The retail investors, having being alloted a paltry, 16 or 17 shares, should book profits upto 580 levels. You stand to earn something around the range of 2-2.5k rs.
The indian stock markets are in a very difficult stage at the moment. I keep my view of doing short term trades.
Gmr infra has again come back to our buying zone
Lok housing, having approximately reached the selling zone, is back to the buying zone.
RNRL is expected to win the gas supply case against RIL. There is some talk of a compromise formula happening and should be positive for RNRL
I keep a buy on it.
KS oil, is trading at important resistance level of 81-83 zone. If markets are positive then i expect it to do some 5-10%
I do plan to attach technical charts to help you people bolster the views which i give based on my analysis.
If any suggestion as to where to post the charts, please do let me know
Happy Investing!
With pathetic market conditions, the grey market premium has considerably come down for the company and there is expectation that it will list at around 600 odd levels.
Most of the HNI's are expected to cash out at 600 odd levels. The FII's are expected to hold on and ride the wave. All ADAG group stocks should do well.
The retail investors, having being alloted a paltry, 16 or 17 shares, should book profits upto 580 levels. You stand to earn something around the range of 2-2.5k rs.
The indian stock markets are in a very difficult stage at the moment. I keep my view of doing short term trades.
Gmr infra has again come back to our buying zone
Lok housing, having approximately reached the selling zone, is back to the buying zone.
RNRL is expected to win the gas supply case against RIL. There is some talk of a compromise formula happening and should be positive for RNRL
I keep a buy on it.
KS oil, is trading at important resistance level of 81-83 zone. If markets are positive then i expect it to do some 5-10%
I do plan to attach technical charts to help you people bolster the views which i give based on my analysis.
If any suggestion as to where to post the charts, please do let me know
Happy Investing!
replies to queries
This is in response to query posted by kairav regarding HFCL
This stock is pure operator play and is not backed by good fundamentals. There was a buzz that before the telecom licenses were handed out, that HFCL will qualify for it. Infact HFCL did not bag a single license and in accordance with the the general sell off in HFCL, it got sold out
Now if you you want to play this stock and watch your pulse rate fluctuate then you can go ahead and do it.
What i do advise is to avoid such operator driven stock as there are better plays available.
In response to sanjeev regarding apply for V guard ipo. You have to realise that the primary markets are in very bad shape due to the greed of the companies and conequent over pricing of the issues by the BRLM( book running lead managers). Besides, whenever you do apply for an ipo, to maximize the chances of allotment, u should apply for 1 lakh INR. with 10,000 which you propose to invest, i wouldnt advise u to apply
This stock is pure operator play and is not backed by good fundamentals. There was a buzz that before the telecom licenses were handed out, that HFCL will qualify for it. Infact HFCL did not bag a single license and in accordance with the the general sell off in HFCL, it got sold out
Now if you you want to play this stock and watch your pulse rate fluctuate then you can go ahead and do it.
What i do advise is to avoid such operator driven stock as there are better plays available.
In response to sanjeev regarding apply for V guard ipo. You have to realise that the primary markets are in very bad shape due to the greed of the companies and conequent over pricing of the issues by the BRLM( book running lead managers). Besides, whenever you do apply for an ipo, to maximize the chances of allotment, u should apply for 1 lakh INR. with 10,000 which you propose to invest, i wouldnt advise u to apply
Wednesday, February 6, 2008
stock recomendation
Dear all,
I had recomended LOK housing couple of days back at 215 odd levels..It hit a high of 252 today. Those who bought, please sell half your shares at around 263-64 levels as this is the 38.2% percentage retracement level from the fall witnessed
Rnrl - please sell half ur shares @ 179-181 levels
Praj and GMRinfra are hold
Ibulls real estate sell 25% of shares @ 690-94 levels
Ks oil- key resistance@ 82-83 levels. will zoom to 90 levels once resistance broken
The new stock which has come on my radar has been Bombay Burmah Trading Corporation
This is wadia group holding company and having major investments in Bombay dyeing
The stock is languishing at its low which was witnessed on 1st feburary and again today.
But i can clearly see a bullish hammer formation.
To further strengthen the buy call is the bullish divergence which I have noticed in RSI and Williams %R oscillator.
I would like you readers to ask me doubts about any stocks which you may want by posting comments and I will surely get back to you.
Besides, I am considering to initiate analysis on the banking sector.
Also, i am planing to create a list of stocks whose analysis can be done on a regular basis
the basket will contain a diverse range of stocks from all sectors
I once again request you to post comments so that we can collectively make the list
Happy Trading!
I had recomended LOK housing couple of days back at 215 odd levels..It hit a high of 252 today. Those who bought, please sell half your shares at around 263-64 levels as this is the 38.2% percentage retracement level from the fall witnessed
Rnrl - please sell half ur shares @ 179-181 levels
Praj and GMRinfra are hold
Ibulls real estate sell 25% of shares @ 690-94 levels
Ks oil- key resistance@ 82-83 levels. will zoom to 90 levels once resistance broken
The new stock which has come on my radar has been Bombay Burmah Trading Corporation
This is wadia group holding company and having major investments in Bombay dyeing
The stock is languishing at its low which was witnessed on 1st feburary and again today.
But i can clearly see a bullish hammer formation.
To further strengthen the buy call is the bullish divergence which I have noticed in RSI and Williams %R oscillator.
I would like you readers to ask me doubts about any stocks which you may want by posting comments and I will surely get back to you.
Besides, I am considering to initiate analysis on the banking sector.
Also, i am planing to create a list of stocks whose analysis can be done on a regular basis
the basket will contain a diverse range of stocks from all sectors
I once again request you to post comments so that we can collectively make the list
Happy Trading!
Saturday, February 2, 2008
Market is King
Dear all,
The turbulent and volatile times are continuing and as predicted earlier, volatility will be the norm for sometime to come. One was advised to do short term trades in such a volatile scenario. The fed cut the fed discount rate according to the expected 50bps and there was an expected sell off in dollar assets.
The dow jones jumped by almost 200 points when the fed cut was announced. But there were news of a large insurer reporting huge losses and the prospects of a rating cut led to massive sell off in the stocks, led by the financials. Our stock markets reacted accordingly and followed global cues to fall.
Next day, the insurer MBIA, came up with a clarification which cheered the us markets. Our markets opened gap down and there were fears that we have entered a bear phase and that FED may not have much left in its armory to save the US from recession. I do agree that there is still lot of pain left in the markets, but let us not to be blind and just behave on what the usa markets are doing.
To everyones suprise, the market recovered in the afternoon and from then, there was no looking back. The volumes were lower which did mean there was a lack of participation on the institutional front. There have been rumours of an impending fall in the markets the coming week. I received this news from everyone including people whom i really like- namely the panwallas and the sub brokers.
I was perturbed by this news as if you have a trading plan in mind which was laid out in front of you earlier, it wouldnt matter much. And also one point which i have not mentioned before is the need to have trading stop losses. They are very important and it makes you flexible and accept the market as being the ultimate king and we being mear slaves. The one who rejects this thesis is bound to be bankrupt soon. You cannot impose your views on the market. The market is much bigger than an individual and the market is always right. The individual may be wrong in the analysis.
So, then, what is the outlook for monday. My analysis says it maybe bullish. My favorite stocks, are giving bullish signals. The conservative traders should still wait for confirmation.
Gmr Infra, the ultimate beauty in trading which bounced from 168-69 levels back to 176 has formed a hammer formation on the charts which implies bullishness. It should reach our target of 183-85 and breaking that would reach 196-98.
Ks oils has formed a morning star pattern and i expect it to reach 82-83 levels soon
Our FM has said, that they may have to review the credit policy soon in view of the recnt global changes and I strongly expect a 25bps reverse repo rate cut by RBI.
I would remain invested in the real estate stocks
Ibulls real estate is a hold
Another real estate stock which i would like to suggest is LOK housing
Its available at the very cheap P/e compared to its peers and has posted impressive results.
Besides many mutual funds, namely, CLSA, kotak mahindra, have bought stakes at 350 levels
There is a preferential allotment to the promoters scehduled to happen at 354.
The Times of India Group is on the board as well
Cmp is around 215. I initiate a buy on it with a 1 year price target of 1000
I suggest that everyone who reads the blog, to do their own analysis before investing.
Further, i would like to make an appeal to everyone who reads this, to refer their friends or whomever they know, who is interestd in the financial markets to Visit this blog
Happy trading!
The dow jones jumped by almost 200 points when the fed cut was announced. But there were news of a large insurer reporting huge losses and the prospects of a rating cut led to massive sell off in the stocks, led by the financials. Our stock markets reacted accordingly and followed global cues to fall.
Next day, the insurer MBIA, came up with a clarification which cheered the us markets. Our markets opened gap down and there were fears that we have entered a bear phase and that FED may not have much left in its armory to save the US from recession. I do agree that there is still lot of pain left in the markets, but let us not to be blind and just behave on what the usa markets are doing.
To everyones suprise, the market recovered in the afternoon and from then, there was no looking back. The volumes were lower which did mean there was a lack of participation on the institutional front. There have been rumours of an impending fall in the markets the coming week. I received this news from everyone including people whom i really like- namely the panwallas and the sub brokers.
I was perturbed by this news as if you have a trading plan in mind which was laid out in front of you earlier, it wouldnt matter much. And also one point which i have not mentioned before is the need to have trading stop losses. They are very important and it makes you flexible and accept the market as being the ultimate king and we being mear slaves. The one who rejects this thesis is bound to be bankrupt soon. You cannot impose your views on the market. The market is much bigger than an individual and the market is always right. The individual may be wrong in the analysis.
So, then, what is the outlook for monday. My analysis says it maybe bullish. My favorite stocks, are giving bullish signals. The conservative traders should still wait for confirmation.
Gmr Infra, the ultimate beauty in trading which bounced from 168-69 levels back to 176 has formed a hammer formation on the charts which implies bullishness. It should reach our target of 183-85 and breaking that would reach 196-98.
Ks oils has formed a morning star pattern and i expect it to reach 82-83 levels soon
Our FM has said, that they may have to review the credit policy soon in view of the recnt global changes and I strongly expect a 25bps reverse repo rate cut by RBI.
I would remain invested in the real estate stocks
Ibulls real estate is a hold
Another real estate stock which i would like to suggest is LOK housing
Its available at the very cheap P/e compared to its peers and has posted impressive results.
Besides many mutual funds, namely, CLSA, kotak mahindra, have bought stakes at 350 levels
There is a preferential allotment to the promoters scehduled to happen at 354.
The Times of India Group is on the board as well
Cmp is around 215. I initiate a buy on it with a 1 year price target of 1000
I suggest that everyone who reads the blog, to do their own analysis before investing.
Further, i would like to make an appeal to everyone who reads this, to refer their friends or whomever they know, who is interestd in the financial markets to Visit this blog
Happy trading!
Subscribe to:
Posts (Atom)
