Wednesday, May 31, 2006

Rise During Fall!

Hope many of you folks might come across series of market falls. Did you ever thought about how to earn there any way I can gain money in this fall day or loss day. If you haven’t thought yet, nothing is late than never, there are ways where in you can gain on falling days. If you are good at predicting next day market, then there is smarter way to earn money in Dalal Street.

Options trading are of 2 types
1. Call Options.
2. Put Options.

Like Equity market price, Call Options premium rates are directly proportional to market rise or any particular stock rise. If you can predict market rise then go for Call Options where in your ROI increases when market increases.

Put Options are means to earn money when market falls. PUT options premium rates increases when market index falls, similarly if market index rises PUT options premium decreases. ROI is inversely proportional to Market Rise or stock price rise.

Yesterday I did my first Put Options trading. I predicted that market will fall yesterday due to momentary global down trend. I bought some PUT options during the day opening and sold the same within the same day. I got 30% ROI in just 2 hours....that too when market witnessing huge fall. Isn't exciting! Options Way to go baby!

Buy CALL Options if you are good at predicting future’s market rise or Buy PUT Options if you are good at predicting future market fall.

Combination of placing and holding CALL & PUT options is termed as HEDGING. Always having combination of the both the options is smarter way to trader.

Happy Investing!

Friday, May 19, 2006

Global Market Phenomena

May 19, 2006, NEW YORK - Wall Street stabilized at the end of a difficult week Friday, closing moderately higher as investors shook off some of their stress about interest rates. The major indexes each lost about 2 percent this week.

NEW YORK (AFP) - The dollar gained ground against the other main currencies as the market focused on the prospect of further increases in US interest rates. The euro fell to 1.2778 dollars at 2100 GMT from 1.2857 dollars late on Thursday in New York.

The London market was unable to find a settled level on Friday as the FTSE 100 (news) continued its recent volatility. The index again spent time either side of the flatline, closing 0.3 per cent lower at 5,657.4. The FTSE 250 bounced on Friday, ending 0.6 per cernt higher at 9,192.6. A sharp fall in the copper prices dragged miners lower, as copper fell as much as 6.7 per cent, its worst one-day slide for 17 months.

All major indices across the globe dropped. The following lists shows index drop percentage for the current week. [May 12, 2006 to May 19, 2006.]

India is the only country which is severely hit because of this global downtrend. BSE Sensex dropped from 12200 to 10950 which is -10.24% approx in 5 Trading Sessions. That is a huge fall for Sensex so far. Second which tops next to India is Brazil Market - 5.75%

Sensex – 12200 – 10950 => -10.24 % (India)
BVSP – 40000 – 37700 => -5.75% (Brazil)
FTSE - 5900 – 5650 => -4.24 % (United Kingdom)
CAC 40 – 5150 – 4940 => -4.1% (France)
DAX – 5900 – 5670 => -3.9 % (Germany)
SES – 2580 – 2490 => -3.5% (Singapore)
Nasdaq – 2240 – 2180 => -2.68 % (USA)
DJI – 11400 – 11100 => -2.63 % (USA)
HKSE – 16700 -16300 => -2.4% (Hong Kong)
Nikkei – 16400 – 16150 => -1.52% (Japan)

For your eyes only, some of the leading world stock market indices trend (3 months) are as follows. One can witness the fall in all major indices during past 1-2 week trading sessions.

Definitely if the world market bounces back, then SENSEX will be the leader in out performing its peers. Today NASDAQ ended in positive node. Hopefully Indian Market will be bouncing back rigorously on Monday, May 22, 2006.



London FTSE








Thursday, May 18, 2006

Journey continues…This time it was BUNGEE JUMPING!

The news which I come across today morning
“Mayhem on Dalal Street as Sensex sees record fall”,
“Mkts in ICU, to be under observation for 48 hours”,
“Markets trading in deep red”,
“Global cues spook market: All Sensex stocks in red”,

Today May 18, 2006, will be a historic day in the Indian Stock Market. Sensex dipped by 826 points in a day. This will be the biggest fall recorded for BSE Sensex index. Just 3 days back I started my Options trading. I have taken a huge risk in investing good amount into Options. Yesterday alone the imaginary Loss which I witnessed is more than the profit which I have realized so far.

Some how, I was not shocked that much though I have invested most of money into Stock Markets! All the news which I read today was not encouraging. I mentally felt being hospitalized for some time.

Nevertheless, I realized an inherent optimistic synergy being generated inside me.

I haven’t gone for bungee jumping (long pending due in my TODO list), but today I felt the feel of doing bungee jumping in stock market. In bungee jumping you know for sure that your legs are tied at one end and you will be
back to the starting point. But the thrill you get on free falling is enormous. Today I just felt the same.

Today it was not a Roller Coaster Ride, rather it was thrilled with Bungee Jumping stunt @ Dalal Street.

Know for sure that I am going to bounce back to the same altitude where I was, and will be scaling up new heights in coming days. Because nothing happend wrt fundamentals of good company in india. Todays shake was due to global fall trend.

Journey Continues!!

Monday, May 15, 2006

A Journey on Dalal Street!

Year 2005- 2006, Lots of Ups and couple of downs in BSE SENSEX!

My Friend, I have an interesting story to share with you! Here you Go!

It all started 5 years back (2001) when I got my first exposure to Equity Markets! During that time not many common people are exposed to Equity Markets! Still I remember the day when ICICI representative approached me @ office to explain about Initially I was bit skeptical about online trading and stock markets. But being an explorer & enthusiastic I decided to go for it. Started trading and got some decent perks from my investments. All of this without knowing much about stock market, online trading and market dynamics.

Then went to ICICI bank to attend online trading session and initial jargons were clarified. In due course of time, switched company and I was busy in building my career life. Trading becomes inactive in my account and I haven’t touched the online account for almost 3 years after switching to new company.

Turning point came in the name of TCS IPO during August 2004. Group of friends pooled lump some amount towards this IPO from an investment point of view without any big strategy in mind. We started realizing the ROI in short term. With confidence gained in IPO started to explore more on direct Equities. Then within a span of 1 year I could able to build a robust portfolio with stocks from many sectors. (IT, Oil & Gas, Telecom, Cement, Bank, Engineering, Tobacco, Utilities, Chemicals). Many thanks to Internet Technology and Booming Market like India!!

Year 2005 was a remarkable Year for Indian Stock market. I enjoyed witnessing the Roller Coaster Ride of BSE Sensex index and learnt many tactics by being the part of the show. Due to my young age and being a bachelor everything went with a strategy of Aggressive Trader. Fingers were burnt and realized losses as well as gains. The pace was never slowed down, Jumped into Margin Trading and again burnt my fingers. Since I have built a pretty decent portfolio, this droved me to increase my risk taking capabilities to larger extent.
Also I understand the thriving need of having strategy in place to play smart in the booming and volatile market.

Strategy moved from short term aggressive trader to short term investor then changed to long term investor. The need for Diversified investments leads to Mutual Fund Exploration. Top Performing Mutual Funds were added to my portfolio and realized the power of MF. All Sleepless nights turned out to peaceful nights.

Again being an explorative and enthusiastic guy I wanted to play game in Futures and Options too! Last Friday (12 May 2006) I did my first Options trading. Thanks to my friend ‘Seenivasan’ who shared his experience on Options. Options trading are very high risk nature but yet promising. I am already in red zone with Options Trading. But never mind, with the active experience gained in past 2 years I am confident to arrive on smart strategy for playing Derivatives game too!

To summarize, Today I have Diversified portfolio which consists scrip from Equity Markets, IPO(s), Option(s), MF(s), Bonds, NSC(s) etc. And with a strategy that constitutes a combination of short term, long term & aggressive nature. It looks fuzzy right; you can also build your own diversified investment portfolio over a period of time. Its not that hard too, all you need have is eagerness to know about market dynamics, thrive to earn money and willingness to play the game.

I am also hearing lot about commodity markets! So what next! Keep Moving Forward :)-

So don’t miss to play the game! Start playing and be a part of the game!

Just posted my Image!