GREAT START

WELL TODAY WE BEGIN TO ACTUALLY WATCH THE MARKET AND WHAT A COINCIDENCE ,DLF'S IPO(INITIAL PUBLIC OFFER) TOO HAS OPENED RIGHT TODAY.
IPO PRESENTS US THE BEST OPPORTUNITY TO BUY SHARES OF A PARTICULAR COMPANY.IF YOU READ DLF'F ADVERTISEMENT IN THE NEWSPAPER TODAY THEN YOU GET A FAIR IDEA OF THE IPO.

LET ME SUMMARISE THE IPO FOR YOU(IT WOULD BE OF GREAT HELP IF YOU KEEP THE ADVERTISEMENT ASIDE YOU JUST NOW).SOME IMPORTANT POINTS ARE JOTTED BELOW
1.DLF LIMITED:
THE IPO HAS BEEN BROUGHT OUT BY A COMPANY NAMED DLF LIMITED.IT IS INVOLVED IN LARGE INFRASTRUCTURAL PROJECTS.
REMEMBER SHAHRUKH KHAN'S AD OR EVEN BETTER THE DLF CUP HELD BETWEEN INDIA,AUSTRALIA AND WEST INDIES RECENTLY.

2.PRICE BAND Rs 500 /-TO Rs 550/- PER SHARE OF FACE VALUE Rs2/-:
THIS MEANS THAT THE SHARE CAN BE BOUGHT AT THE LOWEST OF Rs 500/- AND NOT BEYOND Rs 550/-.THE FACE VALUE SIGNIFIES THE VALUE ON WHICH DIVIDEND WILL BE DECLARED.

3.BIDS CAN BE MADE FOR A MINIMUM OF 10 SHARES AND IN MULTIPLES OF 10 SHARES THEREAFTER:
THIS MEANS YOU CAN BUY 10,20,30,... SHARES AT A TIME.ODD NUMBERS LIKE 5,15,25 ETC AREN'T PERMITTED.

4.BID/ISSUE OPENS TODAY CLOSES ON JUNE 14,2007:
PRETTY STRAIGHT FORWARD,THIS MEANS THAT YOU CAN SUBMIT YOUR APPLICATION FROM TODAY UP TO 14TH OF JUNE (i:e WITHIN THESE FOUR DAYS).

5.HOW TO APPLY?
ITS EASY,GO TO ANY NEAREST SHARE BROKER AND PICK-UP THE FORM(ABSOLUTELY FREE).FILL THE FORM CONSULTING YOUR BROKER AND ATTACH WITH IT A CHEQUE FROM YOUR SAVINGS ACCOUNT AND YOUR PAN CARD'S XEROX COPY.

6.DOES EVERY ONE GETS THE SHARES?
NO,NOT EVERY WHO APPLIES GETS THE SHARES.IT DEPENDS UPON WHAT VALUE YOU APPLY FOR ,HOW MUCH QUANTITY YOU APPLY FOR AND HOW CORRECTLY YOU FILL THE FORM.
FOR INSTANCE HERE THE PRICE BAND IS Rs 500 TO Rs 550/-.THE SHARES WILL BE ULTIMATELY SOLD FOR SOME VALUE IN BETWEEN THE ABOVE TWO VALUES.

SO HOW ARE YOU SUPPOSED TO GUESS THE RIGHT VALUE?
THE EASIEST WAY IS TO LEAVE THE GUESSING TO THE COMPANY,BY SELECTING THE CUT-OFF OPTION.CUT-OFF MEANS THAT YOU ARE READY TO BUY THE SHARES AT WHATEVER VALUE THEY ARE AVAILABLE.

STILL NOT GETTING IT?
YOU CERTAINLY ARE BOUND TO GET CONFUSED BECAUSE OF THE HEAVY INFLUX OF INFORMATION,SO AS USUAL I WILL EXPLAIN WITH A EXAMPLE.

1.SAY I HAVE DECIDED TO APPLY FOR DLF'S IPO.
2.I WILL GO TO ANY NEAREST BROKER AND GET A APPLICATION FORM.
3.I WILL FILL THE FORM PROVIDING ALL NECESSARY DETAILS.
4.NOW I WANT TO BUY 20 SHARES,AT WHAT PRICE SHOULD I BID?
I WILL SELECT THE CUT-OFF OPTION,THAT MEANS I AM READY TO PAY WHATEVER THE FINAL VALUE IS.
5.WHEN I SELECT CUT-OFF OPTION I WILL HAVE TO PROVIDE THE FUND FOR THE SAME.
HERE THE MAXIMUM VALUE IS Rs 550/- AND I HAVE TO BUY 20 SHARES SO I WILL GIVE MY BROKER A CHEQUE OF Rs 11,000/-(550 * 20 = 11,000).
IF THE SHARES ARE FINALLY SOLD AT Rs 530/- ONLY , THEN I WILL GET A REFUND OF Rs 20/- FOR EACH SHARE i:e 20*20 = Rs 400/-.
THIS IS QUITE A SAFE OPTION AND I CAN ASSURE YOU THAT YOU DO GET YOUR MONEY BACK.
6.JUST IN CASE YOU DON'T GET ANY SHARES AT ALL ,THEN YOUR COMPLETE AMOUNT IS REFUNDED TO YOU (MOSTLY WITHIN A FORTNIGHT,BUT DEPENDS UPON WHERE YOU RESIDE).

BETTER ASK THE FOLLOWING QUESTION TO YOUR SELF?
a.DO I REALLY KNOW THE COMPANY (DLF IN THIS CASE) OR I AM JUST TRUSTING TITS AND BITS INFORMATION?
b.DO I HAVE THE LIQUIDITY OF FUNDS?
C.AM I CONFIDENT ENOUGH TO COMPLETE THE TRANSACTION ON MY OWN?
DO NOT BE ASHAMED OF ASKING YOUR BROKER THE SIMPLEST OF THE THINGS,HE IS THERE ONLY TO HELP YOU(RATHER YOU PAY HIM TO DO SO)

WELL YOU CAN CERTAINLY GIVE THIS IPO A TRY,BUT AS I SAID PREVIOUSLY DO NOT LISTEN TO ANY TIPS,DO THE RESEARCH ON YOUR OWN AND THEN DECIDE TO INVEST,BECAUSE THE MONEY INVOLVED IS ALL YOURS.

LETS PAD-UP

AS I MENTIONED IN THE PREVIOUS POST ITS TIME FOR ACTION.
ONLY THOSE WITH A DEMAT ACCOUNT CAN BE PART OF THE ACTION THOUGH,OTHERS NEED TO CATCH UP.

STARTING THIS MONDAY (11th JUNE 2007) WE WILL CLOSELY SCRUTINIZE THE MARKET AND SEARCH FOR OPPORTUNITIES.YOU VERY CERTAINLY WILL EARN MONEY,THE ONLY ISSUE IS WHEN AND HOW MUCH.THE ANSWER TO THIS QUESTION LIES IN YOUR CAPABILITY TO TAKE WELL CALCULATED RISKS.THE DEEPER YOU RESEARCH BEFORE INVESTING THE BETTER THE RESULTS ARE BOUND TO BE.

SO BEFORE BEGINNING TO ACTUALLY TRADE REMEMBER FOLLOWING THUMB RULES.
1.IN SHARES YOU DO NOT EARN UNTIL YOU SELL i:e IF YOU SIT ON THE SHARES JUST LIKE A HEN DOES ON HER EGGS,THEN YOU CERTAINLY AREN'T GOING TO MAKE A PENNY(THE HEN MIGHT AT LEAST GET CHICKS).THE MAJOR EARNING THROUGH SHARES IS THE DIFFERENCE IN THE SHARE PRICES FROM THE TIME YOU BOUGHT IT TO THE TIME YOU WILL SELL IT.

2.REMEMBER THAT INTRA-DAY EARNS YOU THE MAXIMUM PROFIT,AS IT INVOLVES THE MAXIMUM RISK.FIRST GET WELL ACQUAINTED WITH THE MARKET'S PROCEEDING BEFORE INDULGING INTO INTRA-DAY.

3.KEEP A CLOSE TABS OF YOUR TRANSACTIONS.REGULARLY UPDATE YOUR SAVINGS PASSBOOK TO RECORD THE AMOUNT DEDUCTED TIME TO TIME.

4.REMEMBER THAT TRANSACTION ISN'T VALID UNTIL AND UNLESS YOU GET THE CONTRACT NOTE IN YOUR HAND.ALWAYS INSIST FOR A CONTRACT NOTE FROM THE BROKER,IF YOU GET A SOFT COPY THEN GET A PRINT OUT DONE.

5.MAKE A NEW FILE (A PHYSICAL FILE,NOT THE ONE IN YOU COMPUTER) TO PRESERVE ALL RELATED DOCUMENTS.

6.BE IN CONSTANT TOUCH WITH YOUR BROKER.

7.AND THE MOST IMPORTANT ONE,DO NOT BELIEVE IN SO CALLED TIPS GIVEN BY ANYONE (NOT EVEN MINE) BECAUSE THE MONEY INVOLVED IS YOURS .
DO THROUGH RESEARCH WORK,LISTEN TO EXPERTS COMMENT ON T.V AND THEN ONLY INVEST.

REALITY CHECK

WELL THE HEADING ITSELF TELLS YOU A LOT ABOUT THIS POST OF MINE. JUST ASK YOURSELF THE FOLLOWING QUESTIONS

1.AM I READING THE BUSINESS SECTION OF THE NEWSPAPER DAILY?
2.AM I AT LEAST TRYING TO FIGURE OUT WHAT THE LISTINGS IMPLY?
3.AM I VIEWING BUSINESS CHANNELS REGULARLY?
4.HAVE I OPENED A DEMAT ACCOUNT OR AT LEAST GOT MY PAN CARD?
AND MOST IMPORTANTLY
5.AM I TALKING BUSINESS?

NOW UNFORTUNATELY IF ANSWERS TO ALL THE FIVE QUESTIONS ARE NEGATIVE,THEN YOU ARE WASTING YOU GOOD TIME.
IF SOME QUESTIONS ARE GENERATING A POSITIVE REPLY THEN YOU ARE ON THE WAY BUT NEED SOME CATCHING UP .
AND JUST IN CASE ALL THE ANSWERS ARE AFFIRMATIVE (QUITE A RARE INCIDENT) THEN MATE YOU ARE VERY SOON GOING TO TRADE ALONG ME AND START EARNING.

FOR THE REST OF THE GUYS ITS TIME TO DO THE SO CALLED REALITY CHECK,BECAUSE FROM HERE ON I AM TRYING TO TEACH YOU EVERYTHING DIRECTLY WITH REFERENCE TO THE MARKET HAPPENINGS.

SO ARE YOU READY FOR THE ACTION?

HANDS DOWN

WELL THIS POST TOO TOOK A WHILE TO COME,AND AS USUAL I HAVE COME UP WITH A CONCRETE JUSTIFICATION (I AM GETTING GOOD AT MAKING EXCUSES).

I HAD MENTIONED ABOUT PROVIDING YOU ALL SIMPLE SKETCHES TO ASSIST YOUR UNDERSTANDING.I HAVE MADE SOME BUT GETTING THEM POSTED ON MY BLOG IS PROVING A HELL OF A TASK FOR ME ,HOPE I GET OVER IT SWIFTLY.

CONTINUING WITH WHERE WE LEFT , NEWSPAPERS THUS PROVIDE YOU WITH ALL KINDS OF DETAILS OF THE PREVIOUS DAYS' TRANSACTION.THERE ARE STILL A FEW TERMS LEFT BUT YOU WILL GRASP THOSE ONLY WHEN YOU GET INVOLVED.

NOW HOW TO GET LIVE INFORMATION ABOUT THE PROCEEDINGS OF THE MARKET?

ITS EASY FOLKS,SWITCH ON YOUR TV OR INTERNET CONNECTION.
SUPPOSING THAT NOT MANY HAVE NET CONNECTIONS AT HOME (OR SOME HAVE BROADBAND CONNECTIONS WHICH WORK LIKE DIAL-UP) TV EMERGES AS THE BEST OPTION.

IF YOU ASK ME ,THEN THE IDIOT BOX IS A FAR BETTER MEDIUM THAN THE INTELLIGENT BOX.INTERNET PROVIDES YOU ALL THE NUMBERS ,CHARTS ,REPORTS,ETC BUT ALONG WITH THIS T.V PROVIDES YOU EXPERT'S COMMENTS,OTHER IMPORTANT HAPPENINGS WHICH MAY AFFECT THE MARKET TOO.

SO BETTER IF YOU SCROLL YOU T.V SETS AND GET ALL BUSINESS CHANNELS LIKE CNBC18,NDTV PROFIT,Z BUSINESS,ETC TUNED IN .INITIALLY IT MAY FEEL BORING,BUT A BIT OF PERSISTENCE WILL HELP GENERATE YOUR INTEREST.

KEEP GOING

LAST TIME WE SAW WHAT BSE TOP GAINERS/LOSERS AND NSE TOP GAINERS / LOSERS MEAN,NOW ITS TIME FOR SOME MORE TERMS.


ADVANCES DECLINES:
THIS CHART GIVES YOU THE NUMBER OF SHARES WHOSE PRICES HAVE INCREASED (i:e ADVANCED) AND DECREASED (i:e DECLINED).THESE ARE JUST NUMBERS AND PROVIDE YOU AN IDEA OF THE MARKET TREND FOR THE DAY.


YOU MAY THINK THAT IF THE NUMBER OF DECLINES IS MORE THAN THE ADVANCES THEN THE SENSEX/NIFTY IS GOING TO FALL AND VICE-VERSA.
WELL IT IS TRUE BUT NOT ALWAYS THOUGH.ITS NOT JUST 'HOW MANY' BUT ALSO 'WHICH' SHARES ADVANCE OR DECLINE DECIDE THE FATE OF THE SENSEX/NIFTY FOR THE DAY.


SOME SHARES NEITHER ADVANCE OR DECLINE THESE ARE LISTED UNDER UNCHANGED.A SMART INVESTOR MUST ALWAYS BE FAR OFF FROM SHARES WHICH CONSISTENTLY APPEAR IN THE UNCHANGED LIST.


TURNOVER (Rs Cr)
THIS ONE IS QUITE SIMPLE,IT GIVES YOU THE VALUE OF THE VARIOUS TRANSACTIONS TAKEN PLACE THROUGHOUT THE DAY.
THE FIGURES IN CRORES CERTAINLY MAKE US WOBBLE.

BACK TO WORK

WELL I JUST HAD FEW DAYS OF SUMMER VACATION YOU CAN SAY,THOUGH I HAD TO DEDICATE TIME TO MAKE CHARTS OR SKETCHES AS I CALL THEM FOR MY FURTHER POSTS AND SOME EVEN FOR PRIOR POSTS.THEY WILL BE REACHING YOU SOON,BUT TILL THEN LETS JUST TROD THE BEATEN PATH.


IN THE LAST POST I HAD EXPLAINED YOU HOW AND WHAT TO READ IN THE NEWSPAPER LIST.NOW LETS GET SOME MORE DETAILS UNDER OUR BELT(OR BELLY SHOULD I CALL IT)

IF YOU OBSERVE THE SMALL BLOCKS LINED UP ALONG THE LIST THEN YOU MAY FIND TERMS LIKE BSE TOP GAINERS, BSE TOP LOSERS, NSE TOP GAINERS,NSE TOP LOSERS,ADVANCES AND DECLINES,TURNOVER, MARKET CAP ETC.
LETS SORT THEM OUT ONE BY ONE

BSE TOP GAINERS:

THIS IS NOTHING BUT THE LIST OF THOSE SHARES WHOSE PRICES HAVE ROSE THE MOST.IN OTHER WORDS THE SHARES WHOSE PRICES HAVE SHOT UP FROM THEIR YESTERDAYS PRICE ARE LISTED IN DECREASING ORDER OF THE PERCENTAGE CHANGE.THUS SHARE SHOWING HIGHEST PERCENTAGE INCREASE IS LISTED FIRST AND SO ON.
NORMALLY THE CLOSING PRICE OF THE SHARE AND PERCENTAGE CHANGE IN PRICE ARE GIVEN ALONG WITH THE COMPANY NAME.

BSE TOP LOSERS:

EXACTLY OPPOSITE TO BSE TOP GAINERS THIS LIST PROVIDES THE INFORMATION OF SHARES WHICH HAVE RECORDED THE MAXIMUM SLUMP IN PRICE FROM THE PREVIOUS DAY.

THUS THE ABOVE TWO LISTS PROVIDE YOU INFORMATION REGARDING THE BEST AND WORST PERFORMING SHARES OF THE DAY AT BSE.

NSE TOP GAINERS AND LOSERS LIST PROVIDES THE SAME INFORMATION FOR NSE TRANSACTIONS.

AS USUAL TRUST ME TO COME UP WITH AN EXAMPLE TO HELP YOU UNDERSTAND THE ABOVE TERMS BETTER.

work in progress

hi there,this post of mine did take a bit longer to come.but as usual i have a pretty good reason to defend myself.

while reading the last few blogs which contain a lot of technical aspects i realized that some visuals will make understanding the terms and examples a bit easier and less boring too.
well i have been working on it for some days and you will certainly see the difference in the posts to come

till then just bare with me.