Monday, November 13, 2017

VIDEO BLOG: IS JET AIRWAYS AT AN INFLECTION POINT?


VIDEO BLOG: IS JET AIRWAYS AT AN INFLECTION POINT?


https://www.facebook.com/cnbctv18india/videos/1607258569311535

Wednesday, March 15, 2017

DOMESTIC RETAIL INVESTORS: TIME TO SALUTE YOURSELF



This has to be said. Indian retail investors over last many years has been at the receiving end of many jokes. Always buying at the top, selling at bottom, “Dumb money” and what not. But the last 6 months have been remarkably different. It’s time the domestic equity investors put their head high and say “We are the smart money”

Picture this, FIIs sold stocks worth over Rs 40,000 cr post demonetization and when during the initial part of this process the Nifty fell from 8500 to 7900, a bear market loomed large. However, the domestic investors said nothing doing and they started to buy. Dollar to dollar FII selling was matched by DII buying and I am not even counting the direct retail buying.

And now, yesterday FIIs bought 4,000 crores at the highest level of Indian markets. Now this is not to say, FIIs have been foolish. They have a choice of investing in various markets and there are many markets which far outpaced Indian markets so they focused their energy elsewhere. But while in the past, retail would throw in the towel at huge FII selling, this time they kept buying treating this as a flash discount sale and boy are they reaping rewards now?

Make no mistake, market is set to go through a frenzy now but this is the time to sit back and enjoy while FIIs scramble to buy at all-time highs. At some point, this market will become euphoric and fall under its own weight but trust me that time is long long way off right now.

Picture this, over last 2 years when the Nifty has made a move from 9100 to 7000 and back to 9100, the midcap index has surged 24%. So retail has made huge money in individual midcaps. And a rising tide will lift all boats, so the portfolios are set to surge higher even from here.

What if you missed this rally? No problem – wait for dips and consolidations, they will inevitably come but when they do, have to participate. There is no fun in watching someone else make all the money.

Disclaimer: The author of this article does not invest/trade in stock markets including derivatives. His only exposure to stock markets is via the stock options given to him by his employers as part of his compensation


Thursday, March 9, 2017

HOW TO PLAY TODAY?


Extremely important day of trade coming up. As I write this, the SGX Nifty is down about 35 points. The most important cue as we start trade in first half is the big 5% decline in crude oil but the most important cue of second half will be the impending exit polls which will be announced post 5:30 pm. The market will give great opportunities today. This is how I think today can be played.

In first half, focus all your energy on users of crude oil – Oil marketing companies, Paint companies and perhaps most importantly aviation companies which could well go through a goldilocks scenario – tax advantage, lower oil prices and under-owndership.  And with state elections out of the way, OMCs should swiftly move on petrol and diesel prices and paint cos too have corrected from highs. So this appears to be the low hanging fruit.

Crucially, in second half – trading psychology will work. Will shorts want to keep their positions open ahead of a mini binary event? Anecdotally, exit polls favour BJP and the market will know that. So I won’t be surprised to see a late surge in trade today, which could continue with a gap up tomorrow inviting some weak hands and finally a Sell on news in tomorrow’s second half.

These are my thoughts. You should act on what you think is right!!

Disclaimer: The author of this article does not invest/trade in stock markets including derivatives. His only exposure to stock markets is via the stock options given to him by his employers as part of his compensation




Thursday, February 16, 2017

HDFC BANK: THE BIG NEWS FOR TOMORROW’S TRADE


This is going to be a short blog post. A very important trigger for the biggest stock in the Nifty and the Bank Nifty. HDFC Bank is the highest weighted stock on the Nifty and the Bank Nifty and it’s now out of the ban list for FIIs. Simply put, tomorrow morning, FIIs can buy HDFC Bank in open markets. So how crucial is this?

Well first of all, those FIIs who want to own a piece of HDFC Bank all this while could still do it. However they could only do it from their fellow FIIs in a special window and the premium on that is 12%. Even today, while HDFC Bank closed at 1327 in the normal market - http://www.bseindia.com/stock-share-price/hdfc-bank-ltd/hdfcbank/500180/ , it traded at 1482 in the FII window: http://www.bseindia.com/stock-share-price/hdfc-bank-ltd/hdfcbank6/600180/
. So that’s the premium which some FIIs are willing to pay to get the shares of HDFC Bank.

Now, I am not suggesting that the stock immediately goes up 12% tomorrow but what is interesting is that this window will last for all of 2 days, i.e 17th and 20th and by then it will be back in the ban list as there will be enough demand. So it’s literally a case of a flash sale that lasts for a few hours and you see huge demand.

By conservative estimates, I expect the stock to rally at least 5-6% tomorrow. Do the arithmetic on what it could mean for the Nifty and more importantly the Bank Nifty where it has over 30% weight.

Disclaimer: The author of this article does not invest/trade in stock markets including derivatives. His only exposure to stock markets is via the stock options given to him by his employers as part of his compensation