Temasek Holdings has long been a prominent player, known for its strategic investments and global presence. Recently, the financial giant made headlines by announcing its exit from PB Fintech, a move that has sparked interest and speculation within the financial community.
On Thursday, the Singaporean sovereign wealth fund, Temasek Holdings, completed the sale of its complete 5.42% stake in PB Fintech, the parent company of Policybazaar. This transaction, amounting to Rs 2,425 crore, was executed through open market transactions, with Temasek’s subsidiary, Claymore Investments (Mauritius) Pte Ltd, conducting the sale in three separate tranches on the BSE.
PB Fintech, a key player in the financial technology sector, has been making waves with its innovative solutions and market disruptions. Understanding the context of Temasek Holdings’ exit requires a closer look at PB Fintech’s journey and its significance in the fintech landscape.
Temasek Holdings’ Initial Investment in PB Fintech
Delving into the roots of this financial relationship, it’s crucial to explore when and why Temasek Holdings initially invested in PB Fintech. Unraveling the timeline and strategic considerations provides essential context for understanding the recent exit.
Reasons Behind Temasek Holdings’ Exit
The decision to part ways with an investment is never taken lightly. Examining the factors that led to Temasek Holdings’ exit sheds light on the challenges, opportunities, and market dynamics that influenced this strategic move.
Impact on PB Fintech’s Stock and Market Position
With the exit of a major shareholder, PB Fintech’s stock and market standing are inevitably affected. Analyzing the immediate and potential repercussions helps investors and industry observers gauge the implications of this financial maneuver.
Analysis of the Rs 2,425 Crore Sale
Breaking down the numbers, the Rs 2,425 crore sale of Temasek Holdings’ entire 5.42% stake in PB Fintech requires careful scrutiny. Understanding the valuation and financial implications provides insights into the deal’s significance.
Investor Reactions and Market Sentiment
In the world of finance, perception matters. Examining how investors and the market at large responded to this exit offers valuable insights into prevailing sentiments and the perceived health of both companies involved.
Quick Review:
What prompted Temasek Holdings to exit PB Fintech?
Answer: The exit was influenced by several strategic considerations and market dynamics, as outlined in the article.
How does the Rs 2,425 crore sale impact PB Fintech’s future?
Answer: The sale has implications on PB Fintech’s stock, market position, and strategic direction, covered in detail in the article.
Piramal Enterprises, a key player in the Indian business landscape, has recently made a strategic decision that has sent ripples across the financial industry. The company has announced its intention to sell the entire 20% stake it holds in Shriram Investment Holdings for a substantial amount of Rs 1,440 crore.
In a move that caught many by surprise, Piramal Enterprises has opted to divest its stake in Shriram Investment Holdings, a significant player in the financial services sector. This article delves into the reasons behind this decision, its potential impact on Piramal Enterprises, and the broader implications for the industry.
Background of Piramal Enterprises
Piramal Enterprises, with a rich history and diverse business interests, has been a key player in sectors such as pharmaceuticals, financial services, and real estate. Over the years, the company has strategically navigated various market challenges, making headlines with its innovative business moves.
Shriram Investment Holdings
Shriram Investment Holdings, a subsidiary in the Shriram group, has been a valuable asset in Piramal Enterprises’ portfolio. The company operates in the financial services domain, contributing to Piramal’s diverse investment landscape.
Reasons behind the Stake Sale
Financial motives primarily drive Piramal Enterprises’ decision to divest its stake in Shriram Investment Holdings. The market dynamics, coupled with Piramal’s strategic vision, have paved the way for this significant move.
Impact on Piramal Enterprises
While the immediate impact includes substantial financial gains for Piramal Enterprises, the long-term implications of parting ways with Shriram Investment Holdings raise questions about the company’s future strategy.
Market Reaction
The announcement has triggered notable movements in Piramal Enterprises’ share prices. Investor sentiments are diverse, and analysts are closely monitoring the situation, offering varied perspectives on the potential outcomes.
Future Plans of Piramal Enterprises
The utilization of funds obtained from the stake sale and Piramal Enterprises’ strategic vision for the future are crucial aspects that investors and industry experts are keenly observing.
Industry Perspective
This move by Piramal Enterprises is not isolated, as broader trends in the financial sector suggest a dynamic landscape where companies reassess their stakes for strategic advantage.
Regulatory Landscape
Navigating through regulatory compliance and obtaining necessary approvals is a critical step for Piramal Enterprises, considering the intricacies involved in such strategic transactions.
Challenges and Risks
Executing a stake sale of this magnitude comes with its set of challenges and risks, from market fluctuations to unforeseen obstacles that may impact the seamless completion of the transaction.
Expert Opinions
Financial experts weigh in on the implications of Piramal Enterprises’ decision, providing insights into the potential trajectory of the company in light of the stake sale.
Comparison with Competitors
Analyzing how other companies in similar contexts manage their stakes provides a broader perspective on Piramal Enterprises’ strategic move.
Public Perception
Understanding how the public perceives this decision is essential, as it reflects not only on Piramal Enterprises but also on broader market sentiments.
Company Communication
The way Piramal Enterprises communicates its decision to stakeholders and the public plays a crucial role in shaping perceptions and maintaining transparency.
Quick Review:
Why is Piramal Enterprises selling its stake in Shriram Investment Holdings?
Piramal Enterprises is divesting its stake for financial reasons and to align with its strategic vision.
How will the stake sale impact Piramal Enterprises in the long run?
The long-term implications include questions about the company’s future strategy and direction.
What are the challenges Piramal Enterprises may face during the stake sale process?
Challenges include market fluctuations, regulatory compliance, and unforeseen obstacles.
How are investors reacting to Piramal Enterprises’ decision?
Investor sentiments are diverse, and analysts offer varied perspectives on potential outcomes.
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.
Swing trading is a short-term trading method that can be used when trading stocks & options. Whereas day trading positions last less than one day, swing trading position typically last two to six days, but may last as long as two week or month.
Swing trading is a short-term strategy used by traders to buy & sell stocks whose technical indicator suggest an upward or downward trend in the near future generally one day or two weeks.
Swing trading uses technical analysis to determine whether or not particular stocks will go up or down in the very hear term. By examining technical indicators, day traders look for stocks whose price movement have momentum signaling the best times to buy or sell. Swing traders are not concerned with the long-term value of a given stock.
TWO KEYS OF SWING TRADING STRATEGIES
1. OOPS
2. MEAN REVERSION
1. OOPS
Object Oriented Programming Strategy.
Simple OOPS trades developed by Larry Williams at least 30 years ago.
RULES
SE TUP – Any opening gap, whether up or down offers a potential signal.
LONG – On a gap down, place a buy – stop at yesterday’s low.
SHORT – On a gap up, place a sell – stop at yesterday’s high.
EXIT ON THE ‘FIRST PROFITABLE OPENING’ (FPO)
FPO stop exit the trade the first time a position opens with a profit.
Testing shows this consistently makes money by holding a position overnight.
Exit on 20% stop loss.
The stop loss is below the low of the same day.
ITS VERY EASY TO IDENTIFY OOPS PATTERN IN THE CHART:
OOPS BUY
If you are watching daily charts, the first condition is that there has to be a SUSTAINED downtrend for a few trading sessions. I mean few RED CANDLES on daily charts.
On the last day of downtrend, the OOPS buy occurs, there is a gap down, which open well below the previous day’s low.
During the course of trading the stock rises & goes above the previous day’s low & also the previous day’s close.
OOPS SELL
If you are watching daily charts, the first condition is that there has to be a SUSTAINED uptrend for a few trading sessions. I mean WHITE CANDLE on daily charts.
On the last day of uptrend when the OOPS sell occurs, there is a gap up opening, which opens well above the previous day’s high.
During the course of trading the stock corrects & goes below the previous day’s high, & also the pervious day,s close.
2. MEAN REVERSION
Mean reversion is a theory used in finance that suggests that assets price & historical returns eventually return back to the long run mean or average level of the entire data set. This mean or average can be the historical average of the price or return,or another relevant average such as the growth in the economy or the average return of an industry.
The idea of mean reversion is rooted in a well known concept called regression to the mean.
This is a theory first observed by statistician francis gallon.
The two most popular types of trading strategies are momentum & mean reversion. A mean reversion trading strategy involves betting that prices will revert back toward the mean or average.
When the market is moving sideways or consolidating, a particular asset might exhibit mean reversion in the short run & trend following strategies will not work.. prices & returns eventually move back to their mean or average stance this concept forms the basis of many successful strategies.
How do we identify the underlying trend? That’s the essence of this strategy! Consider the dummy example below:
We calculate the 90-day Moving Average(90d MA)of the stock price and treat that as the underlying stable trend. We also calculate the 30-day Moving Average(30d MA)and can see that it zig-zags around the 90d trend. Now we can build the following strategy:
When the value of 30d MA falls below 90d MA we expect it to revert back to the 90d line. That is, the current price is too low and likely to increase. Hence this is a signal to buy
Similarly, if the value of 30d MA rises above 90d MA we expect it to fall back to the 90d line. Hence the current price is too high and is a signal to sell
One other mistake new investors make is utilizing borrowed funds to pay for shares. That is nearly at all times a horrible concept that may result in disaster. Once you borrow cash to spend money on shares, you might be inviting one other particular person or establishment which can not have your greatest curiosity at coronary heart into the decision-making course of. Cease the entire nonsense about “good debt” and “dangerous debt” and notice that threat discount is usually extra vital than your compound annual progress fee.
2. Know What You Need, And What You’re Paying For.
The evolving brokerage business is a beehive of competitors to supply the most recent and biggest buying and selling choices, however for many buyers the essential necessities could be discovered wherever.
Ensure you know the kind of purchase or promote order you are coming into. A market order, as an illustration, will likely be executed as quickly as doable, regardless of the prevailing market value; a restrict order against this will solely full the transaction inside value parameters you have established.
3. Different brokerages have different strengths and weaknesses.
Naturally, totally different brokerages have very totally different strengths and weaknesses. Some have very excessive charges on transactions however will provide a ton of assist to particular person buyers. Others may provide decrease charges however be very hands-off. Some may cost nothing for sure sorts of transactions (often if you’re shopping for the corporate’s personal investments, which I’ll clarify beneath).
What brokerage do I take advantage of? I take advantage of Motilal Oswal. That is largely as a result of I make investments my very own cash in it for which they don’t cost any excessive transaction charges. You’ll be able to examine Motilal Oswal brokerage companies in my subsequent weblog.
4. The Chart
Studying to learn a chart is a talent that takes time, however primary chart studying takes little or no talent. As famed investor Dennis Gartman says on a regular basis on CNBC, if an funding’s chart begins on the decrease left and ends on the higher proper, that is a very good factor. If the chart is heading down, keep away and do not attempt to determine why. There are literally thousands of shares to select from with out choosing one that’s shedding cash. If you happen to actually imagine on this inventory, put it in your watch checklist and are available again to it at a later time.
There are lots of individuals who imagine in investing in shares which have scary wanting charts, however they’ve analysis time and sources that you simply most likely do not.
5. Buy Low, Sell High.
Sounds so easy proper? And but investing is a uncommon a part of our monetary lives the place issues getting cheaper seems like a nasty factor. Few shoppers are lamenting cheaper costs on the pump amid the collapse in oil costs over the past yr and a half, but a reasonable market fall is handled because the dying knell for the bull market.
These are information that aren’t mutually unique: the present bull market will finish, and over nearly any long-term horizon shares have confirmed to be useful investments that usually grind increased.
6. Trade what you see, not what you Think.
As a dealer, you could have most likely learn that you should management your feelings and give attention to logic and objectivity as an alternative of giving into the impulses of greed, hope, and concern. Nevertheless, it’s one factor to know you shouldn’t commerce emotionally and one other to truly know HOW to NOT commerce emotionally and how you can implement this information.
Whereas “buying and selling what you see” describes the optimum state of affairs during which merchants make goal choices primarily based on sound value evaluation, “commerce what you assume” is the precise reverse and it’s how nearly all of merchants make their buying and selling choices – pushed by feelings, impulses and wishful considering.
As a way to turn out to be a persistently worthwhile dealer it’s needed to plot a plan utilizing our extra logical and goal frontal lobe part of the mind, which is the latest space of the human mind and permits us to plan, motive, and comprehend sophisticated concepts.
By studying to commerce what we see, and never what we expect, we will ensure that we’re working on logic and objectivity as an alternative of emotion.
7. Watch out for red flags.
There are a number of pink flags to look at for when selecting shares. Simply to call a number of, rookies ought to keep away from the next sorts of shares
Corporations that do not earn any earnings
Shares whose share costs appear to at all times drop (have a look at the three- or five-year chart)
Corporations which are beneath investigation
Corporations with a lot of debt
Shares with current dividend cuts, or an unstable dividend historical past
8. Don’t put all Eggs in one basket.
It is a piece of recommendation which signifies that one shouldn’t focus all efforts and sources in a single space as one may lose every part.
Don’t pull all of your eggs in a single basket; means don’t threat every part . If you happen to maintain all of your egg in a single basket, if the basket will get stolen or somebody drop the basket then you find yourself shedding all of your eggs. However however in case you had stored your eggs on a number of baskets and if one had been dropped by somebody or received stolen. Then you definately would have free solely a few of your eggs not all.
This proverb can be relevant in stock Market.
If you happen to make investments your total cash on one shares, and if the share goes down, it can take you down. That’s the reason it’s suggested by no means totally depending on one share. As a substitute make investments on a number of shares. Thus if one goes down you lose few cash not all.
9. If you cannot control your emotions, you cannot be in share market.
Unless you can watch your stock, holding decline by 50% without becoming panic, you should not be in stock market.
Don’t let feelings cloud your judgement. Many buyers have been shedding cash in stock markets because of their lack of ability to manage feelings, significantly concern and greed.In a bear market, however, buyers panic and promote their shares at rock-bottom costs.
Greed augments when buyers hear tales of fabulous returns being made within the stock market in a brief time frame. “This leads them to take a position, purchase shares of unknown corporations or create heavy positions within the futures phase with out actually understanding the dangers concerned.”
As a substitute of making wealth, these buyers thus burn their fingers very badly the second the sentiment available in the market reverses. In a bear market, however, buyers panic and promote their shares at rock-bottom costs. Thus, concern and greed are the worst feelings to really feel when investing, and it’s higher to not be guided by them.
10. Buy right and hold tight.
In share market before buying anything one should have a total knowledge about it, because right buying is one of the most important factor in share market. Before buying any share there are certain parameters one should look. Buying right in shares means you have to see the Fundamental Analysis should be strong.
It should be technically strong and its should up trending. One should also see that the company must be listed at least from last 5-7 years. Also should check the dividend ratio of last few years.
And once this all parameters are in favor, the shares are purchased the the role come of hold tight. Try to hold the shares for longer time to take the benefits of it. Just because the rates are falling or rising that dosen’t means it’s a right time to sell it. We should have a control on it and try to hold the shares. Selling of shares should be depend on it’s graphs, charts & company condition and not the price. Yes, price may also be one of the reason for selling the shares, but should not be the only factor.
“A mutual fund is a professionally managed investment scheme, usually run by an asset management company that brings together a group of people & invests their money in stocks, bonds & other securities.”
INTRODUCTION:
Mutual funds are the most popular investment types for the everyday investor. Because they are easy to use in many in many ways, investing for dummies. A mutual fund is a kind of investment that uses money from many investors to invest in stocks, bonds & other types of investment. A fund manager decides how to invest the money & for this he is paid a fee, which comes from the money in the fund. All the MUTUAL FUNDS are registered with SEBI.
In simpler terms, mutual funds are like baskets. Each basket holds certain types of stocks, bonds or a bland of stocks & bonds to combine for one mutual fund portfolio.
Eg: An investor who buys a fund called XYZ international stock is buying one investment security, the basket that holds dozens or hundreds of stocks from all around the globe, hence the “International” monike.
TIP’S FOR BEGINNERS INVESTING IN MUTUAL FUNDS
Start saving & investing early in life.
Try to understand the fund in which you are investing.
Check the past performance of your mutual fund.
Don’t avoid Index fund.
Experience of fund managing team
Do not commit common mistakes
Understanding the risk involved
Keep your investment objective clear.
The NAV does not matter.
Diversify your investment over time.
Have an investment discipline.
Invest in stocks if you are prepared to take risks.
Never forgot your mutual fund investment.
Stay invested for a longer period of time.
NAV ( NET ASSET VALUE )
NET ASSET VALUE is the total asset value (net of expenses) per unit of the fund & is calculated by AMC (asset management company) at the end of every business day. In order to calculated the NAV of a mutual fund, you need to take current market value of the funds assets minus the liabilities, if any & divide it by the number of share outstanding. NAV is calculated as follows.
NAV Rs. = MARKET/FAIR VALUE OF SECURITIES + ACCRUED INCOME + RECEIVABLE + OTHER ASSETS + ACCRUED EXPENSES – PAYABLES – OTHER LIABILITIES
/ NO.OF UNITS OUTSTANDING OF THE SCHEME/OPTION
Eg. If the market value of securities of mutual fund scheme is Rs. 500 lakh & the mutual fund has issued 10lakh units of Rs. 10lakh each to investors, then the NAV unit of the fund is Rs.50.
ADVANTAGES OF MUTUAL FUND
DIVERSIFICATION
Mutual funds provide the benefits of diversification across different sectors & companies. A single mutual fund can hold securities from hundreds or even thousands of issuers. This by investing in a mutual fund, you can gain from the benefits of diversification & asset allocation, without investing a large amount of money that would required to build an individuals portfolio. The diversification considerably reduces the risk of serious monetary loss due to problems in a particular company or industry.
AFFORDABILITY
You can begin buying units or shares with a relatively small amount of money.
Eg. Rs. 500 for the initial purchase.
Some mutual funds also permits you to buy more units on a regular basis with even smaller installments.
Eg. Rs.50 per month.
LOW TRANSACTION COST
Due to economics of scale, mutual funds pay lower transaction costs. The benefits are passed on to mutual fund investors which may not be enjoyed by an individual who enters the market directly.
TRANSPARENCY
Funds provide investors with updated information pertaining to the markets & schemes through fact sheets, offer documents, annual report etc.
DISADVANTAGES OF MUTUAL FUNDS
· High Expense Ratios and Sales Charges
If you’re not paying attention to mutual fund expense ratios and sales charges, they can get out of hand. Be very cautious when investing in funds with expense ratios higher than 1.20%, as they will be considered on the higher cost end. Be weary of 12b-1 advertising fees and sales charges in general. There are several good fund companies out there that have no sales charges. Fees reduce overall investment returns.
· Management Abuses
Churning, turnover and window dressing may happen if your manager is abusing his or her authority. This includes unnecessary trading, excessive replacement and selling the losers prior to quarter-end to fix the books.
· Tax Inefficiency
Like it or not, investors do not have a choice when it comes to capital gain payouts in mutual funds. Due to the turnover, redemptions, gains and losses in security holdings throughout the year, investors typically receive distributions from the fund that are an uncontrollable tax event.
· Poor Trade Execution
If you place your mutual fund trade any time before the cut-off time for same-day NAV, you’ll receive the same closing price NAV for your buy or sell on the mutual fund. For investors looking for faster execution times, maybe because of short investment horizons, day trading, or timing the market, mutual funds provide a weak execution strategy.
Share means you become the company owner partly. In share market, shares are bought & sold. The stock market is a place, however besides share of companies, other instruments like bonds, mutual funds & derivative contracts too are traded in the stock market.
Always remember one thing when working in share market, that it has to be considered as your secondary income source.
Look at share market as part time income.
While working in share market does not use your entire amounts for intraday trading. Make good allocation of your amounts, use 80:20 formula. Means if I have Rs.1 lakh so 80,000 (i.e 80%) I will use for delivery-based investment & remaining 20,000/-(i. e. 20%) I will use for trading. Always control your losses, always trade with strict stop losses or else please do not trade, even while doing investment we can earn good returns.
There are 2 types of people working in share market.
First is investor who does Investments.
Second is trader who does Trading.
The most important thing in share market is that it runs on emotions, so here we have to control our emotions. If you have earned profit do not be happy & in emotions you do not have to trade more or if you have incurred losses do not be sad.
Stock market are some of the most important parts of today’s global economy. Countries around the world depend on stock market for economic growth. However, stock markets are relatively new phenomenon. They haven’t always played an important role in global economics.
The top 10 stock market in the world today ranked by market capitalization.
NEW YORK STOCK EXCHANGE
NASDAQ
TOKYO STOCK EXCHANGE
LONDON STOCK MARKET EXCHANGE
EURONEXT
HONG KONG STOCK EXCHANGE
SHANGHAI STOCK EXCHANGE
TORONTO STOCK EXCHANGE
FRANK FURT STOCK EXCHANGE
AUSTRALIAN SECURITIES EXCHANGE
Other rising stock market outside of the top 10 include the BOMBAY STOCK EXCHANGE based in Mumbai, INDIA as well as the BM & FBOVESP stock exchange based in SAO PAULO, BRAZIL.
*TIPS FOR BEGINNERS IN STOCK MARKET
UNDERSTANDING HOW MARKET BEHAVE.
STOCK MARKET VALUATION MATTERS.
THINK LONG – TERM & BE PATIENT.
LOOK FOR TOP BRAND COMPANIES THAT CONTROL PRICES.
MINIMIZE YOUR MISTAKS & LEARN FROM THOSE YOU MAKE.
NEVER OVERPAY.
NEVER INVEST IN A BUSINESS YOU CANNOT UNDARSTAND.
DON’T COMPROMISE ON THE QUALITY OF BUSINESS.
JUST DON’T LISTEN TO THOSE WHOM YOU TRUST, START TAKING ADVICE FROM THOSE WHO ALREADY INTO IT & ARE EXPERTS.
EVERYDAY WATCH CNBC AWAZ, ZEE BUSINESS, NDTV PROFIT, ET NOW etc LIKE BUSINESS CHANNELS TO GET LATEST MARKET UPDATES.
READ NEWSPAPERS LIKE ECONOMIC TIMES, FINANCIAL EXPRESS, BUSINESS STANDARD.
TO DO INVESTMENTS IN MARKET THAT IS DELIVERY BUY SUGGESTED MONTHS ARE JUNE, JULY& AUGUST.
BEST MONTH FOR SELLING IS JANUARY OR FEBRUARY (before budget).
DO MOCK TRADING OR PAPER TRADING FOR 1 WEEK WHILE LEARNING.
BULLISH MARKET:
A trend in financial markets can be defined as direction in which the market moves. ‘bullish trend’ is an upward trend in the price of an industry stocks or the overall rise in broad market indices, characterized by high investor confidence.
BEARISH MARKET:
A ‘BEAR MARKET’ is a condition in which securities prices fall & widespread pessimism causes the stock markets downward spiral to be self-sustaining. Investors anticipate losses as pessimism & selling increases.
STOCK EXCHANGE
Stock exchange is a place where buying & selling of shares happens.
BSE – BOMBAY STOCK EXCHANGE
NSE – NATIONAL STOCK EXCHANGE
THESE TWO ARE NATIONAL LEVEL EXCHANGE IN INDIA.
To know any countries economic condition & stock markets rate fluctuation a parameter known as INDEX is used. A stock index or stock market index is a measurement of a section of the stock market. It is computed from the prices of selected stocks. It is tool used by investors & financial managers to describe the market, & to compare the return on specific investments.
SENSEX: (or sensitive index)
BOMBAY STOCK EXCHANGE (BSE) index is known as SENSEX.
Sensex started on 01/01/1986 & its base rate was Rs.100/-
Sensex is calculated by average price of TOP 30 company by market capitalization.
On 25 july 2001 BSE launched dollar – 30, a dollar- limited version of S&P BSE SENSEX.
The base year of SENSEX is 1978-1979 & the base value is 100
More than 5500 companies are publicly listed on the BSE.
As of 25th September 2017, the full market capitalization of S&P BSE Sensex was about Rs.54,637.0878 billion (US $837 billion) (37% of GDP) while its free float market capitalization was Rs.30,094.2286billon (US $4616). During 2008-12, Sensex 30 Index share of BSE market capitalization full from 49% to 25% due to the rise of sectoral indices like BSE PSU, BANKEX, BSE- TECK etc.
Analysts & investors use the sensex to observe the growth, development of particular industries & booms & base of the Indian economy.
If sensex goes up, it means that most of the stocks in India went up during the given period. If the sensex goes down, this tells you that the stock price of most of the major stocks on the BSE has gone down
METHOD ADOPTED FOR SENSEX CALCULATION:
The method adopted for calculating sensex is the market capitalization weighted method in which weights are assigned according to the size of the company larger the size, higher the weightage.
NIFTY:
NATIONAL STOCK EXCHANGE (NSE) index is known as NIFTY.
Nifty started on 03/11/1995.
Nifty is calculated by 23 various sectors & top 51 companies.
The S&P nifty (also known as NSE nifty-50 or Nifty) is a stock Index in India.
The constituents of the Index change periodically, depending on liquidity, availability of floating stock, turnover & volume of transactions.
S&P (NX Nifty, which is owned & managed by India Index sevices & products ltd. (IISL), is India’s first company to focus upon a stock Index as a core product. IISL has a marketing & licensing agreement with standard & poor’s (S&P) Index sevices.
Maximum volumes take place on NSE & hence enjoy leadership position in the country today.
The National Stock Exchange (NSE) in India’s leading stock exchange covering 364 cities & towns across the country.
NSE has played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices & trading volumes.
NSE’s mission is setting the agenda for change in the securities markets in India. The NSE was set up with following objectives:
Establishing a nation-wide trading facility for equities, debt instruments & hybrids.
Ensuring equal access to investors all over the country through an appropriate communication network.
Providing a fair, efficient & transparent securities market to investors using electronic trading system.
Enabling shorter settlement cycles & book entry settlements systems.
Meeting the current international standards of securities markets.
DIFFERENCE BETWEEN BSE and NSE
BASIS FOR COMPARISON
BSE
NSE
Introduction
Bombay Stock Exchange is the oldest financial market in the country, which offers high speed trading to its customers.
National Stock Exchange is the biggest capital market of the country. The exchange is a front runner in the introduction of the fully automated, electronic trading system across the nation.
Founded in
1875
1992
Benchmark index
Sensex
Nifty
Total listed companies (April 2015)
5650
1740
Market Capitalization
Around 1.68 trillion
Around 1.5 trillion
Global Rank
10th
11th
Network
Over 400 cities
Over 2000 cities
TYPES OF ORDERS
MARKET ORDER
Market order means while doing trading whatever rate is there in front of you, you buy or sell at that prevailing rate is known as MARKET ORDER.
Eg. SBIN @250
And immediately you buy or sell at the same price means MARKET ORDER.
BUY SBIN @250
LIMIT ORDER
Limit order means while trading I will not place buy/sell order at the current going rate but at rate which I wish to put. This is known as LIMIT ORDER.
When we place a STOP LOSS or TARGET ORDER these are all limit order because we place stop loss & target order at rate which we wish to place.
Eg. SBIN CMP @250
BUY SBIN @249.50 ( pending limit order)
SELL SBIN @ 250.50 (pending limit order)
STOP ORDER
Stop order, also referred to as stop loss order, is an order to buy or sell a stock once the price of the stock reaches a specified price, known as the stop price. When the stop price is reached, a stop order becomes a market order. A buy stop order is entered at a stop price above the current market price.
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.
