The risk-reward ratio is a concept used in investing and trading to assess the potential profitability of a trade or investment relative to the associated risk. It quantifies the relationship between the amount of risk taken and the potential reward or profit that can be achieved.
Here’s what you need to know about the risk-reward ratio:
1. Definition:
The risk-reward ratio compares the amount of potential loss (risk) to the potential gain (reward) of a particular investment or trade. It helps investors and traders evaluate whether the potential return justifies the level of risk they are assuming.
2. Calculation:
The risk-reward ratio is calculated by dividing the expected reward or profit by the expected risk or potential loss. It is typically expressed as a ratio or a fraction. For example, a risk-reward ratio of 1:2 means that for every unit of risk, there is an expectation of gaining two units of reward.
3. Risk Assessment:
The risk component of the ratio refers to the potential loss or downside associated with the investment or trade. It is important to assess and quantify the potential risk based on factors such as market volatility, historical price movements, and the specific characteristics of the investment.
4. Reward Assessment:
The reward component of the ratio represents the potential profit or upside that can be achieved. This is determined by factors such as the target price, profit targets, market conditions, and the potential for price appreciation or income generation.
5. Interpreting the Ratio:
A higher risk-reward ratio implies that the potential reward is greater relative to the risk undertaken, indicating a more favorable opportunity. On the other hand, a lower risk-reward ratio suggests that the potential reward is relatively smaller compared to the risk, indicating a less attractive opportunity.
6. Risk Management:
The risk-reward ratio plays a crucial role in risk management. By considering the potential risks and rewards of a trade or investment, investors can make informed decisions and set appropriate stop-loss levels or exit strategies to limit potential losses and protect capital.
7. Individual Preferences:
The appropriate risk-reward ratio varies based on an individual’s risk tolerance, investment goals, and trading strategy. Some investors may be willing to take on higher risk for the potential of higher rewards, while others may prioritize capital preservation and prefer lower risk-reward ratios.
Importance Risk-Reward Ration:
1. Decision-making Tool:
The risk-reward ratio provides a framework for evaluating and comparing investment opportunities. It helps investors and traders assess the potential benefits relative to the risks involved in a particular trade or investment. By considering the risk-reward ratio, individuals can make more informed decisions based on the potential payoff and the level of risk they are willing to assume.
2. Risk Management:
Effective risk management is crucial for long-term success in investing. The risk-reward ratio helps investors determine their risk tolerance and set appropriate risk management strategies. By maintaining a positive risk-reward ratio, individuals can aim to limit potential losses while seeking opportunities with favorable risk-reward profiles.
3. Risk and Reward Balance:
The risk-reward ratio emphasizes the importance of balancing risk and reward. It encourages investors to seek opportunities where the potential reward justifies the assumed risk. This balance is essential for achieving sustainable and consistent returns while managing downside risk.
4. Psychological Discipline:
The risk-reward ratio plays a crucial role in maintaining psychological discipline in investing. By considering the potential risks and rewards, individuals can avoid chasing excessive profits without proper risk assessment. It helps anchor decision-making on rational analysis rather than emotional impulses, reducing the likelihood of making impulsive and detrimental investment choices.
It is important to note that the risk-reward ratio is just one tool among many used in investment analysis. Other factors, such as fundamental analysis, market conditions, and investor objectives, should also be considered when making investment decisions. The risk-reward ratio serves as a useful guideline to assess the potential benefits and risks associated with an investment or trade, helping investors make more informed and balanced decisions.
Following are some of the powerful sectors for the investors to make the investments in the current market situation. As per the facts this sectors can be very promisable for the traders.
Today we will discuss the best stocks for long term investment. These stocks can give you a better return. Don’t miss the chance just go & invest in these stocks. These stocks are fundamentally & technically strong stocks. Let’s analyze some best stocks for long term investment.
1.RELAXO FOOTWEARS
Relaxo Footwears Limited is an Indian multinational footwear manufacturer based in New Delhi. It is the largest footwear manufacturer in India in terms of volume and second-largest in terms of revenue.[4][5] The company makes products under 10 brands including Flite, Sparx, Bahamas and Schoolmate.
Market Cap ₹ 23,716 Cr.
Debt ₹ 174 Cr.
ROE 14.0 %
Sales growth 12.5 %
Promoter holding 70.8 %
Stock P/E 102
Industry PE 55.1
ROCE 18.0 %
2.ALKYLAMINE
Incorporated in 1979 by Mr Yogesh Kothari, Alkyl Amines is a leading manufacturer of aliphatic amines in India. Aliphatic amines are products derived from Ammonia (NH3) by displacement of H2 in the Ammonia molecule by other radicals (R) such as Methyl, Ethyl and Propyl.
Market Cap ₹ 13,531 Cr.
Debt ₹ 23.3 Cr.
ROE 25.2 %
Sales growth 24.2 %
Promoter holding 72.0 %
Stock P/E 60.2
Industry PE 22.1
ROCE 33.0 %
3.ULTRACEMCO
UltraTech Cement Limited is an Indian cement company based in Mumbai, and a part of Aditya Birla Group. UltraTech is the largest manufacturer of grey cement, ready-mix concrete (RMC) and white cement in India with an installed capacity of 116.75 million tonnes per annum. It is the only company in the world to have a capacity of over 100 million tonnes in a single country, outside of China.
Candlestick is the most popular & most usable chart in trading. Even most of the successful traders also advise to use this charts for trade. Candlestick chart is invented by MUNEHISA HOMMA.
This charts were developed in the 18th century by Munehisa Homma, a Japanese rice trader. He is considered as the father of the candlestick chart. He is one of the most successful trader in History. The Candlestick trading Bible is one of the most powerful trading systems in history. This trading system is based on Japanese candlestick patterns in combination with technical analysis. Learning Japanese candlestick is like learning a new language. We have to understand the psychology behind the candle formation, understand the candle pattern & most important thing is to understand the trends.
CANDLESTICKS BODY
Candlesticks have different colors and body size.
The most trading platforms were using White & Black color refers to Bullish & Bearish candlestick charts.But, at present it has been upgraded with colorful charts where white candle is denoted by Green Color & Black candle is denoted by Red color.Filled part of the candlestick is called the Real Body. Thin lines poking above & below the body are called Shadows/Tail.
If the candle closes above the open price, it indicates the market forms a bullish candlestick. Bullish candles always display as Green color.And if the candle closes below the open price, it indicates the market forms a bearish candlestick. Bearish candles always display as Red color.
But the color doesn’t matters, you can use whatever color you want.
Long v/s Short
Long bodies of candles shows strong buying & selling pressure. Bullish long candle indicates that buyers are more stronger than sellers and they are taking control of the market during this period of time. Conversely, a bearish long candle indicates that sellers are stronger than buyers & they are taking control of the market during this period of time.
Short & small bodies indicate a little buying & selling activity.Upper & lower shadows give us important information about the trading session. Candlestick with long shadows show that trading action occurred well past the open & close. Japanese candlesticks with short shadows indicates that most of the trading actions are confined near the open & close.
If a candlestick has a longer upper shadow, and short lower shadow, this means that buyers flexed their muscles and bid price higher. But for one reason or another, sellers comes in and drove the price back down to end the session back near its open price.
If a Japanese candlestick has a long lower shadow and short upper shadow, this means that sellers flashed their washboard abs and forced the price lower. But for one reason or another a buyer comes in and drove prices back up to end the session back near its open price.
CANDLESTICK PATTERNS
Candlestick patterns are one of the most powerful trading concepts, they are simple, easy to identify, & very profitable setups. Candlestick patterns are the language of the market. Here are some of the candlestick patterns that will help us in the market:
1. THE DOJI CANDLESTICK PATTERN
Doji is the most important Japanese Candlestick Pattern. When this candlestick forms, it tells us that the market Opens & Close at the same price which means that there is equality & indecision between buyers & sellers there is no one in control of the market. If the closing & opening prices are same, that means candle is giving us a single, that market is not able to decide which direction to take. The above chart shows how the market has changed the direction after the formation of the Doji candle pattern. If Doji forms in uptrend it gives a signal, that the buyers are failing to keep the price up & sellers are pushing the price back to the opening price. When Doji form in downtrend that indicates the market is ready to go up side & it gives a reversal signal.
2.THE DRAGONFLY DOJI PATTERN
Dragonfly Doji is a Bullish candlestick Pattern. Dragonfly Doji is formed when the open, high & close are the same & it has no upper shadow. An important identification of dragonfly doji is its long lower shadow. Indecision & trend reversal are indicators of the dragonfly Doji. The long lower tail suggests that the force of supply & demand are nearing a balance & that the direction of the trend may be nearing a major turning point.
The above chart shows how the downtrend market changes the direction of the market toward uptrend. The formation of dragonfly Doji with long lower tails shows us that there is a high buying pressure in the area. The war between Bull & Bear, attempted by the bear towards pushing price down, but here buyers are stronger than sellers.
3.THE GRAVESTONE DOJI
The gravestone doji is the Bearish version of the dragonfly doji. It is a bearish reversal candlestick which mostly occurs at the top of uptrends. The formation of the long upper tail is an indication that the market is testing a powerful supply or resistance area.
The image above is a perfect gravestone Doji. This pattern indicates that while buyers were able to push prices well above the open. Later in the day, sellers overwhelmed the market pushing the price back down. This is interpreted as a sign that bulls are losing their momentum and the market is ready for a reversal.
4.THE BEARISH ENGULFING BAR CANDLESTICK PATTERN
The bearish engulfing is one of the most important candlestick patterns. Engulfing bar is formed when it fully engulfs the previous candle.
The first candlestick shows that the bulls were in charge of the market, while the second shows that bearish pressure pushed the market price lower. The second period will open higher than the previous day but finish significantly lower.
The engulfing bar can engulf more than one previous candle, but to be considered an engulfing bar, at least one candle must be fully consumed. When this pattern occurs at the end of an Uptrend, this indicates that buyers are engulfed by sellers which signals a trend Reversal.
The pattern is also a sign for those in a long position to consider closing their trade.
5.THE BULLISH ENGULFING BAR PATTERN
A bullish engulfing pattern is the opposite of a bearish engulfing pattern. Many traders use this candlestick pattern to identify price reversals and continuations to support their trading strategies.
The bullish engulfing bar consists of two candlesticks, the first one is the small body, & the second is the engulfing candle. When a bullish engulfing candle forms at the end of downtrend the reversal is much more powerful as it represents a capitulation bottom. The color of the body is not important, what’s important is that the smaller one is totally engulfed by the second candlestick.
6.MORNING STAR CANDLESTICK
The Morning Star Pattern is considered as a BULLISH REVERSAL PATTERN. A morning star candlestick pattern can successfully predict or explain trends in price movements in the case of equity, currency trading or financial derivatives. This pattern occurs at the bottom of Downtrend near a support level, it is interpreted as a powerful trend Reversal Signal. The first candlestick is bearish. The second candle is small & this can be Bullish Or bearish. Second one produces indecision in the market, second candle could be a DOJI or any other CANDLE. The Third candle is a bullish candlestick that gapped up on the open & closed above midpoint of the body of the first day, this candlestick holds a significant trend reversal signal.
7.THE EVENING STAR PATTERN
The Evening Star Pattern is the opposite of the Morning star pattern. The evening star pattern is considered as a Bearish Reversal Pattern. This pattern occurs at the top of an Uptrend. The First candle is a Bullish candle. The second candle is a small candlestick, it can be bullish or bearish or it can be a DOJI or any other Candles. The third candle is a large bearish candle. In general the evening star pattern is the bearish version of the morning star pattern. Third candlestick gaping lower than the previous candlestick indicating a confirmation of the reversal & the beginning of new trend down.
8.HAMMER (BIN BAR)
The hammer is a reversal candlestick pattern when it occurs at the bottom of a Downtrend. Long lower shadow that indicates a bullish rejection from buyers & their intention to push the market.
Understand the psychology behind the formation of patterns , here sellers forcefully push the price down but that time of period buyers are more powerful than sellers which result in trend reversal.
9.SHOOTING STAR (BEARISH PIN BAR)
Shooting star is the Bearish version of the hammer. This candle is characterized by a small body. And long upper shadow. Shadow should be twice the length of the real body. This pattern occurs in an uptrend. It indicates a bearish reversal pattern.
It is one of the most powerful signals.
10.HARAMI PATTERN ( INSIDE BAR)
Harami pattern (Pregnant In Japanese) is considered as a Reversal & Continuation pattern, & it consists of two candlesticks. The first candle is the large candle, it is called the mother candle, followed by a smaller candle which is called the baby. Harami pattern to be valid, the second candle should close outside the previous one. This candlestick is considered as a Bearish Reversal Signal when it occurs at the top of an uptrend, and it is Bullish Signal when it occurs at the bottom of a Downtrend. Smaller body is totally covered by the previous mother candle. Don’t bother yourself with colors, the most important is that the smaller body closes inside of the first bigger.
11.TWEEZERS TOPS & BOTTOMS
The tweezers top formation is considered as a Bearish Reversal Pattern seen at the top of an Uptrend. The tweezers bottom formation is interpreted as a Bullish Reversal Pattern seen at the bottom of a Downtrend. The first one is a bullish candlestick followed by a bearish candlestick. And the tweezer bottom formation consists of two candlesticks as well. The tweezer bottom happens during a Downtrend.
Note:
The candlestick pattern is more workable in higher time frame (weekly, daily & 4hr.) compare to lower time frame. When candlestick pattern is form in the chart, than wait for confirmation & follow up.
“Volume Weighted Average Price (VWAP) is a technical analysis tool used to measure the average price weighted by Volume. VWAP is typically used with intraday charts as away to determine the general direction of intraday prices. VWAP is similar to a moving average in that when price is above VWAP, prices are rising & when price is below VWAP, prices are falling VWAP is primarily used by technical analysts to identify market trend.”
Full form of VWAP is Volume Weight Average Price. The average price weighted by volume. VWAP is a trading tool calculated by taking the number of shares bought times the share price & dividing by total shares.
Volume Weighted Average Price is an Indicator, or used for Intraday trading. VWAP equals the dollar value of all trading periods divided by the total trading volume of the current day.
The VWAP appears as a single line on intraday chart (1min,5min,15min & so on), similar to how a moving average looks. The calculation starts when trading opens & when it closes. Because it is good for the current trading day only , intraday periods & data are used in the calculation.
HOW TO CALCULATE VWAP:
VWAP is calculated through the following steps:
For each period, calculate the typical price, which is equal to the sum of the high, low, and close price divided by three [(H+L+C)/3]. One bar or candlestick is equal to one period. What this period is set at is up to the trader’s discretion (e.g., 5-minute, 30-minute, etc.).
Take the typical price (TP) and multiply by the volume (V), giving a value TP*V.
Keep a running tabulation of the TP*V totals as well as a running tally of volume totals. These are additive and aggregate over the course of the day.
VWAP is calculated by the formula: cumulative TP*V / cumulative volume
This calculation, when run on every period, will produce a volume weighted average price for each data point. This information will be overlaid on the price chart and form a line, similar to the first image in this article.
Moving VWAP is simply adding up various end-of-day VWAP figures and averaging them out over a user-specified number of periods.
VWAP will be calculated automatically in one’s charting software. There should be no mathematical or numerical variables that need adjustment. On the moving VWAP indicator, one will need to set the desired number of periods.
HOW TO ANALYSIS VWAP:
VWAP initiate at the opening price level, & will move up or down with price movement & volume as the session continues. It can help to eliminate a lot of the noise within a stock throughout the day, even more so than a moving average would. It is compared at time to a moving average, & though it shares similarities, they are not the same.
It’s said when price is below the indicators, the stock is in downtrend or there is a downtrend bias to the day and when price is above the indicator, the stock is a uptrend.
Find the average price the stock traded at over the first five-minute period of the day. To do this, add the high, low, and close, then divide by three. Multiply this by the volume for that period. Record the result in a spreadsheet, under column PV.
Divide PV by the volume for that period. This will give the VWAP value.
To maintain the VWAP value throughout the day, continue to add the PV value from each period to the prior values. Divide this total by total volume up to that point. To make this easier in a spreadsheet, create columns for cumulative PV and cumulative volume. Both these cumulative values are divided by each other to produce VWAP.
VWAP Pullback Entry:
Entry Option 1 – Aggressive Traders
Wait for a break of the VWAP and then look at the tape action on the time and sales.
You will need to identify when the selling pressure is spiking, and the tape is going crazy.
This, my friend, is more art than science and will require you to practice reading the tape.
The goal is to identify when the selling pressure is likely to subside and then enter the trade.
This approach will break most entry rules found on the web of simply buying on the test of the VWAP. The problem with this approach is you don’t know if the price will breach the VWAP by 1% or 4%.
I learned the hard way, and if the VWAP were at $10, I would place my limit order at $10. At times there were traders who couldn’t care less about the VWAP, and it would slice through the indicator with such swiftness, the lasting sting to my psyche persists until this day.
This technique of using the tape is not easy to illustrate looking at the end of day chart. You will need to practice this approach using Tradingsim to assess how close you can come to calling the turning point based on order flow.
VWAP Breakout Entry:
Entry Option 2 – Risk Averse Traders
This is what I would recommend to traders that are new to the VWAP indicator.
Essentially, you wait for the stock to test the VWAP to the downside. Next, you will want to look for the stock to close above the VWAP.
You will then place your buy order above the high of the candle that closed above the VWAP.
While this is a more conservative approach for trade entry, it will open you up to more risk as you will likely be a few percentage points off the low.
You will need to determine where you are in your trading journey and your appetite for risk to assess which entry option works best for you.
It goes without saying that while we have covered long trades; these trading rules apply for short trades, just do the inverse.
The Internet is stuffed with resources. You’ll find tons of data out there free of charge. However, as the count increases, it’s actually inconceivable to remember all of the websites that you simply visit even in a single day.
However, when the subject comes to acquiring the related info and the maximum information and all the related data, one always wish to persist with his favorite websites where he may get all the quality information.
Stock market investing is a risky venture. It’s worthwhile to be very cautious whereas putting your hard-earned money into it. Before diving into the dynamic stock market, you must possess the best set of information and sufficient information. So, as an investor, you should be aware of a few of the finest websites for Indian stock market analysis.
All have their own favorites! However, in terms of selecting the most effective websites for Indian stock market research, we would have a standard selection. Let’s see if our choice matches together with your short term and long term investing objectives.
The website was started by the husband and wife team of Victor and Sangeeta Fernandes. In 2000, it was acquired by E-Eighteen dot com, a subsidiary of the Indian TV channel TV18. The couple were given 7.5% of the equity capital and E-18 got 92.5% following the acquisition. In 2014, Reliance Industries acquired Network 18 and TV18. This acquisition included Moneycontrol.com and several other websites and channels owned by TV18.
Moneycontrol is definitely the preferred website among the many Indian stock investor. You’ll find all types of information on this website like market news, trends, charts, livestock prices, commodities, currencies, mutual funds, personal finance, IPOs and many others.
That is certainly one of many extremely standard stock market website for an Indian investor. In different words, it may be considered probably the most accessed website, each by potential and present stock investors.
You even have a platform to track your investments and create a wish list too. Furthermore, Money Control mobile app is much more handy to put in and use. So, an entire bundle for a stock investor, whether a beginner or a professional.
It gives numerous stock securities info like their Sensex and Nifty value. Stock securities include Equities, debts, Latest IPOs, currencies, live stocks, commodities, and derivatives. Historic knowledge and present efficiency of the various companies can also find right here.
Forums are also facilitated for doing discussions in the group. You’ll be able to refer to those boards and may update yourself with the updated information.
The National Stock Exchange of India Limited (NSE) is the leading stock exchange of India, situated in Mumbai. The NSE was established in 1992 as the primary demutualized electronic trade within the nation. NSE was the primary exchange within the nation to offer a modern, totally automated screen-based electronic trading system which provided simple trading facility to the traders spread throughout the length and breadth of the country. Vikram Limaye is Managing Director & Chief Executive Officer of NSE.
It has a complete market capitalization of greater than US$2.27 trillion, making it the world’s 11th-largest stock exchange as of April 2018. NSE’s flagship index, the NIFTY 50, the 50 stock index is used extensively by investors in India and all over the world as a barometer of the Indian capital markets. Nifty 50 index was launched in 1996 by the NSE. Nevertheless, Vaidyanathan (2016) estimates that solely about 4% of the Indian economic system / GDP is definitely derived from the stock exchanges in India.
In contrast to countries like America where nearly 70% of the GDP is derived from bigger companies and the corporate sector, the corporate sector in India accounts for only 12-14% of the nationwide GDP (as of October 2016). Of these solely 7,800 corporations are listed of which solely 4000 commerce on the inventory exchanges at BSE and NSE. Therefore the stocks trading on the BSE and NSE account for under round 4% of the Indian economic system, which derives most of its earnings associated exercise from the so-called unorganized sector and households.
As the company has an obligation to submit their financial reviews to the NSE, therefore you may always find the financial information of any firm right here, in case you may find it elsewhere. You’ll find details about the corporates, domestic and foreign buyers, new listings, IPO and many others. NSE India also offers programs and certifications.
It ranks effectively within the prime stock research websites in India. You get to see tons of historic information relating to NSE and Nifty as effectively. You additionally take pleasure in free technical analysis of Indian stocks, reports, charts and different website tools.
The Bombay stock exchange was founded by Premchand Roychand. He was probably the most influential businessmen in 19th-century Bombay. A person who made a fortune within the stockbroking business and got here to be often known as the Cotton King, the Bullion King or simply the Big Bull. He was also the founding father of the Native Share and Stock Brokers Affiliation, an institution that’s now referred to as the BSE.
Whereas BSE Ltd is now synonymous with Dalal Street, it was not all the time so. The first venue of the earliest stock broker meetings within the 1850s was in relatively pure environs – beneath banyan trees – in entrance of the Town Hall, the place Horniman Circle is now located. A decade later, the brokers moved their venue to a different set of foliage, this time under banyan trees at the junction of Meadows Street and what’s now referred to as Mahatma Gandhi Road. The group ultimately moved to Dalal Street in 1874 and have become an official group referred to as “The Native Share & Stock Brokers Association” in 1875.
On August 31, 1957, the BSE grew to become the primary stock exchange to be acknowledged by the Indian Government under the Securities Contracts Regulation Act. Historically an open outcry flooring trading exchange, the Bombay Stock Exchange switched to an electronic trading system developed by CMC Ltd. in 1995. It took the exchange solely 50 days to make this transition. The BSE has also launched a centralized exchange-based internet trading system, BSEWEBx.co.in to allow traders wherever on the planet to trade on the BSE platform.
The BSE can also be a Partner Exchange of the United Nations Sustainable Stock Exchange initiative, becoming a member of in September 2012.
BSE established India INX on 30 December 2016. India INX is the first international exchange of India.
That is much like NSE India. Nevertheless, you will discover extra historic information right here as BSE Sensex has been included for an extended time in comparison with NSE Nifty.
As well as, over 5,500 companies are listed on BSE whose company actions and financial information could be found on this website. You may also obtain the whole checklist of ‘public’ companies from this website.
Investing.com is a global financial portal and internet brand owned by Fusion Media Limited, registered in the British Virgin Islands, composed of 28 editions in 21 languages and mobile apps for Android and iOS that provide news, analysis, streaming quotes and charts, technical data and financial tools about the global financial markets. The editions each cover a broad variety of financial vehicles including Stocks, Bonds, Commodities, Currencies, Interest Rates, Futures and Options
Branded initially as Forexpros.com, the portal launched in 2007 with editions in four languages: English, Spanish, Hebrew and Arabic, offering free data, information, analysis, news and tools over the Forex market for traders. Six additional editions followed in 2008, growing to a total of 18 different localized editions by the end of 2011.
Investing.com currently offers 30 localized (Language localisation) editions in 22 languages including: Arabic, Chinese, Dutch, English, Finnish, French, German, Greek, Hebrew, Italian, Indonesian, Japanese, Korean, Malay, Polish, Portuguese, Russian, Spanish, Swedish, Thai, Turkish and Vietnamese. Additional editions are dedicated to the Australian, Brazilian, Canadian, Hong Kong, Indian, Mexican and South African markets.
Investing is a good site if you want to find all the information on the same website simultaneously. You can do both fundamental and technical analysis of stocks on this website. The different options available on this website are general info, chart, news and analysis, financials, technicals, forum etc.
Its wide range of tools and comprehensive data can surely incline any investor towards it. Stock screener, Fed rate monitor tool and currency converter are the biggest attractions. The live and interactive charts, stocks charts, indices and forex charts further add to its advantages.
Investing is just like the best newspaper for stock market India.The screen of the site reproduces every detail information towards you regarding the NAV value of your stocks, the index value, the peer information and many other details which can be simplified by customizing the screen according to your preferences.
Screener, a stock analysis instrument especially meant for equity traders in India. With this, you’ll be able to have entry to long term financials of various companies and additional simplify it. Thereby, turning lengthy knowledge into small helpful chunks by customised studies. So, you’ll be able to simply make your self acquainted with helpful financial info of an organization.
Furthermore, with the assistance of it’s screening instrument, you’ll be able to design your personalised display screen and get computerized alerts to trace outcomes. A mixture of a “Firm evaluation” and a “screening” instrument, this absolutely attracts readers to navigate by it.
It is among the greatest Indian stock market technical evaluation web site. It serves you normal details about the market financial system, the corporate efficiency previously and the current, their friends out there and their efficiency too, the corporate’s revenue and losses and the balance sheet, analysis studies and numerous evaluation instruments just like the charts are provided on this platform.
The sophisticated lengthy knowledge might be personalised and customised as per your selection and choice which is able to simplify the understanding.It additionally supplies display screen alerts on the person’s mobile and the websites additionally for each up to date info in the market.
“The ratio of the volume of put options traded to the volume of call options traded, which is used as an indicator sentiment (bullish or bearish).”
Put-call ratio (PCR) is an indicator that forecast the trend of the INDEX/STOCKS.
A “Put” or put option is a right to sell an asset at a predetermined price. A “Call” or call option is right to buy an asset at a predetermined price. Many traders use options for directional beta; buying call when market bullish & buying put when market bearish.
PCR is a popular derivative indicator, specifically designed to help traders gauges the overall sentiment of the market. The ratio is calculated either on the basis of options trading volumes or on the basis of the open interest for a particular period.
This indicator will show you which gang is dominating the market; the bearish gang (short masters), or the bullish gang (long masters).
The put call ratio can be calculated for any individual stock, as well as for any INDEX, or can be aggregated.
HOW TO ANALYSES PCR:
The put call ratio is calculated by the dividing the number of OPEN INEREST of put option by the number of OPEN INEREST of call option.
PCR (OI) = PUT OPEN INTEREST ON GIVEN DAY/ CALL OPEN INTEREST ON SAME DAY:
PCR for marker wide position can be also be calculated by taking total number of OI for all OI call options & for all OI options in a given series.The PCR can be calculated for indices, indivu
Eg.
PUT (OI)CALL (OI)
CURRENT MONTH CURRENT MONTH
NEXT MONTH NEXT MONTH
FAR MONTH FAR MONTH
PCR = PUT (OI)/ CALL (OI)
PCR = ?
A rising put-call ratio, or a ratio greater than .7 or exceeding 1, means that equity traders are buying more puts than calls. It suggests that bearish sentiment is building in the market. Investors are either speculating that the market will move lower or are hedging their portfolios in case there is a sell-off.
A falling put-call ratio, or below .7 and approaching .5, is considered a bullish indicator. It means more calls are being bought versus puts.
“A stock is a general term used to describe the ownership certificates of any company. A share, on the other hand reffers to the stock certificate of particular company . Holding a particular company’s share makes you a shareholder.”
The stock (also capital stock) of a corporation is all of the shares into which ownership of the corporation is divided. In American English, the shares are company known as “stocks”.
A stock is an investment. When you purchase a company’s stock, you’re purchasing a small piece of that company called a share.
A stock is a type of investment that represents an ownership share in a company. Investors buy stocks that they think will go up in value over time.
A share of company held by an individual or group. Corporations raise capital by issuing stocks & entitle the stock owners (shareholders) to partial ownership of the corporation. Stocks are bought & sold on what is called an Exchange. There are several types of stocks & the two most typical forms are preferred stock & common stock.
Owning a stock gives you certain rights & those rights can differ depending on the types of stock you own.
There are two main types of stock:
COMMON STOCK
PREFERRED STOCK
1. COMMON STOCK:
Common stock is a form of corporate equity ownership. It being primarily used in the united states. They are known as equity shares or ordinary shares in the UK.Common stock comes with voting rights; as well as the possibility of dividends & capital appreciation. Each share of common stock represents a share of ownership in a company. If a company does well or the value of its assets increases, common stock can go up in value. On the other hand, if a company is doing poorly, a common stock can decrease in value. Simply put, common stock allows investors to share in a company’s success over time, which is why they can make great long-term investments.
2. PREFERRED STOCK
“Preferred stock is also known as preference stock. The word “Preferred” refers to the dividends paid by the corporation. Each year, the holders of the preferred stock are to receive their dividends before the common shareholders are to receive any dividend”.Preferred stockholders generally do not have voting rights, though they have a higher claim on assets & earnings that the common stockholders.
Preferred shares can be converted to a fixed number of common shares, but common shares don’t have this benefit.Like bonds, preferred stocks are rated by the major credit rating companies. The rating for preferred stocks is generally lower than for bonds because preferred dividends do not carry the same guarantees as interest payments from bonds & because preferred stock holders claims are junior to those of all creditors.
Some things you need to know about stocks:
a. P/E RATIO –
The price to earnings ratio (P/E ratio) is the ratio for valuing a company that measures its currents share price relative to its pre share earnings (EPS)…. P/E ratios are used by investors & analysts to determine the relative value of a company’s shares in an apple to apples comparison.The ratio is used for valuing companies & to find out whether they are overvalued or undervalued.Earnings are important when valuing company’s stock because investors want to know how profitable a company is & how profitable it will be in the future.
b. CHART –
Chart reading is the single most important investing skill you’ll ever learn. To understand why stock chart are so valuable. Chart tells you a whole story about stocks. The weekly chart helps you see longer term trends. And daily chart helps you spot specific buy & sell signals while daily price fluctuation perspective.
c. Dividend –
If you don’t have time watch the market every day, and you want your stocks to make money without that kind of attention, look for dividends. Dividends are like interest in a savings account. You get paid regardless of the stock price. Dividends of 6% or more are not unheard of in high quality stocks. Before purchasing a stock, look for the dividend rate. If you simply want to park money in the market, invest in stocks with a high dividend. (For more, see Why Dividends Matter.)
d. Taxes Can Take A Bite Out Of Your Profits –
The FANG stocks – Facebook FB +0%, Amazon.com AMZN +0%, Netflix NFLX +0% and Google GOOGL +0% (Alphabet) — had a great run in 2015, with returns ranging from 34% to 134%, but from a tax perspective any investor who bought last year and eyeing the exits wants them to keep climbing. That’s because the one-year mark is a line of demarcation for the tax man.
Selling stocks, you’ve held for less than a year triggers a short-term capital gain, taxed as ordinary income. That could mean kicking back anywhere from 25% to 39.6% to Uncle Sam. But hold those same stocks for at least 12 months and the tax rate drops to 15% for most tax brackets.
WHY TO INVEST IN IT
Investing in the stock is the only way most people have of building real wealth. Stock is just one of many potential places to invest your money. Investing in stock is often risky, which draw attention to huge gains & losses of some investors.
One of the primary benefits of investing in the stock market is the chance to grow your money. Over time, the stock market tends to rise in value, though the prices of individual stocks rise and fall daily. Investments in stable companies that are able to grow tend to make profits for investors. Likewise, investing in many different stocks will help build your wealth by leveraging growth in different sectors of the economy, resulting in a profit even if some of your individual stocks lose value.
Stocks are risky This means they don’t have a guaranteed return and sometimes lose money. However, the long-run trend of the stock market has been undeniably upward. Stocks have the highest return of any investment asset over the long term. According to the Federal Reserve, the stock market has grown by an average of more than 10 percent a year over the past 50 years. During this same period, government bonds only grew by 5 percent a year. If you can stomach the market swings, you will see the highest return on your money with the stock market.
Purchasing stocks of companies operating in different sectors as well as segments is possible, which helps in optimizing the asset-allocation and provides diversification.
Long bodies of candles shows strong buying & selling pressure. Bullish long candle indicates that buyers are more stronger than sellers and they are taking control of the market during this period of time. Conversely, a bearish long candle indicates that sellers are stronger than buyers & they are taking control of the market during this period of time.
