Indian Stocks and Indian Placements

The so called experts

2008-04-27T20:22:00.001-07:00

I am an investor like you but have you noticed who really is the expert in the area of stock markets. To name a few, I would point point Warren Buffet which is there to see. Basically it is your experience and the younger you are the more risk you can take. With experience, you know how to and where to put your money and when to remove the money. So it is better to research and then invest rather than listen to so called guru's who might make your money vanish and then say it is due to the market and not his fault.

If you look at advertisements of brokers, you will find that they list 10 to 15 stocks which has gained more than 200% in a year but advertisements can be deceiving, what the brokers dont mention is that they had recommended 100 stocks out of which only 10 to 15 stocks gave good returns what about the rest, the rest will never be put in the advertisment otherwise will they get business, so decide for yourself.

Caution is the word in the market

2008-03-24T21:20:00.000-07:00

Everyone including the fund managers are cautious in this volatile market. Though there are money to be parked in the stock market. Everyone is cautious with a wait and watch approach so it is good for the retail investors also to wait and watch. Go for fundamentally good stocks but dont buy in bulk but small quantity at a time and average it as it goes down.

Wait and watch should be to motto

2008-03-19T05:01:00.000-07:00

Retail investors should wait and watch. Now is not the time to buy thinking it has reached the bottom. There are lots of uncertainities in the market and it is better to wait and watch but at the same time go for fundamentally good stocks but that too purchase little by little so that even if it comes down one can average it down.

Retail Investors should think long term

2008-03-17T21:19:00.000-07:00

Retail investors should think long term in such murky situation in the dalal street. If they are holding good fundamental stocks then it is time to think long term, forget that the script that you have purchased is going down hill. In such a scenario, it is but naturally to sell thinking that market is going down hill but to hold on to fundamentally good scripts would be a far far better option.

Facor Alloy is bound to go up within 6 to 9 months

2008-02-13T00:05:00.000-08:00

Facor Alloy has gone upto Rs.21 and now come back to 9.00 level. I believe it is a good opportunity to accummulate this stock because this stock has got the potential to surpass the earlier upper limit of Rs.21 so buy buy

Consumer Complaints for Investors

2007-08-26T03:06:00.000-07:00

I found this site which might be useful to those investors who have complaints against brokers, companies, banks, etc. http://www.core.nic.in/

Stocks e books site

2007-07-22T00:39:00.001-07:00

For stocks e books for free download, please visit www.esnips.com

Facor Alloy has come out of the red

2007-06-18T20:21:00.000-07:00

It seems Facor Alloy has come out of the red, its profit has increased over the period of 1 year and I believe short term uptrend can be expected in this script with the June Quarter result. Accumulation for short term profit is recommended. The current price of this script is Rs.2.17

IFCI having a grand party

2007-01-15T09:59:00.000-08:00

IFCI is having a grand party mainly due to various factors like selling of stake in NSE, etc., etc., Before the result is out, this stock might give good returns but the worrying factor is the delivery which has come down to 18% so though this stock might go up fast, the downward trend also will be faster. Once should buy in small lots and sell when in profit for short term. Before the budget one should sell this stock and buy when it goes down again. Long term this appears to be a upcoming script but time will tell.

Website like orkut but with a difference

2006-12-04T21:48:00.000-08:00

Most of you must be aware of the website called www.orkut.com. I have found out another website which not only allows you to post messages but also allows you to earn money for each posting at the rate of $0.02 per message. The messages can be on various topics on earth including stocks. The address of the website is www.myLot.com?ref=earndollars

BSE Stock Prediction site

2006-12-01T01:20:00.000-08:00

For prediction of price of stocks, please visit the following site. Please note that I have not tested this site myself.

http://www.stunnets.com/dresult.jsp

Send SMS using this website

2006-11-30T20:36:00.000-08:00

If you want to send SMS to your friends, relatives, use the following site
http://indianfunlife.com/sms_compose.php

Teledata Informatics Ltd

2006-11-23T05:31:00.000-08:00

Even though Teledata Informatics Ltd was making profit the script was lagging behind. Now it seems the promotors are silently accumulating the stock because from 4% the promotors investment has gone to 14% and the result is also good. Buying this script at the current level is advisable. Those who have purchased at a high price can average it. Even if the script goes down, try to average it. Installment buying is suggested since a major correction can take this script to even 11 or 12 level but seeing the promotors confidence again in this script a buy is recommended.

EBooks on other subjects

2006-11-10T22:51:00.000-08:00

Some other ebooks related to other subjects like positive thinking, etc. all free for download:

http://www.freebooksclub.co.nr

EBooks on Stocks, Technicals, Charts

2006-11-10T06:34:00.000-08:00

Lots of ebooks on stocks, technicals, charts are available at the following site:

http://www.4shared.com

Please type in the "I am looking for" dialog box under File Search which is there on the screen and enter words like stock, technical analysis, charts, ebooks and any other stock jargon and do the search and you will find lots of books on the subject.

RTI Act helps man get back ‘dead’ investments

2006-11-05T19:49:00.000-08:00

Did you know that RTI Act can be very useful in

Getting information about your IPO refund and thereby faster refund.
Get information about companies that are de listed and the reason, etc, etc.
Get information about the companies on any matter related to investors

The RTI Act has been used by Lab Assistant, Plumber and various other common people to make the Government servants give information to the common man. This RTI Act has also nailed a politician and hence efforts are made by interested politicians to remove the notings on the files.

Below is the article which appeared in Times of India on Sunday 05^th November, 2006 about how a person got his investment back. Please do contact me if you need direction. I will put you to the correct person for registering complaints.

The Right To Information(RTI) Act has come to the rescue of an investor who had been fighting to get his ‘dead’ investment back for the last 10 years. A query was filed under the Act after the Mumbai collector’s office inordinately delayed the execution of a district consumer forum’s directive to attach the property of Suman Motels Limited for repayment of the investment.

The forum, in April this year, had directed the collector of Mumbai to take necessary action to repay the investment amount (with accumulated interest) to Chetan Kothari, an investor in Suman Motels Ltd. But for three months, the collectorate sat over the directive. Frustrated by the bureaucratic delay, Kothari filed an RTI query, “Within 15 days, I got a reply from the collector’s office that necessary steps have been taken and recovery proceedings have begun. “said Kothari.

In 1996, Kothari had invested Rs 3 lakh in Suman Motels’ two holiday charter schemes. The company had launched 12 such schemes to lure investors I the company “They had a variety of schemes, like holiday time share, plantation, agricultural land and bungalow investment schemes.” said Kothari, In the holiday scheme that Kothari invested, his capital was supposed to increase one and half times. The amount was to have matured in 2001.

The scheme had also promised that investors will be able to stay for a week in any of the Suman Motel’s resorts spread across the country, “I never got even the principal amount back, “he said.

Kothari then filed a case in the district consumer forum in 2002. The forum directed the collectorate office to repay the investor Rs. 5.28 lakh which included the interest.

“I provided a copy of the order to the collectorate officials, but for three months the authorities did not take any action.” Kothari claimed. He then filed a query under the RTI Act asking why attachment proceedings have not been initiated against the company.

Within 15 days he got a reply from the collector’s office stating that the recovery procedure has begun and that notices in this regard will be sent soon. Last week, the company came forward and settled the claim and deposited the amount at the collector’s office.

“The company had duped 62,552 small investors to the tune of Rs 300 crore. I have also filed a winding up petition against the company at the Bombay High Court so that all the investors get back their money” said Kothari, who is also the convener of Suman Motels Investor Forum. For any information, please contact me at stocksplacement.blogspot.com

2006-11-05T07:23:00.000-08:00

Some books for you. The credit for these books goes to id Dr. Raman Kumar

1. Day Trading. :
http://rapidshare.com/users/D4EZXL

2. Options & Derivatives ( Some of the books are really high level and
it is advisable that you go through them if you know the basics of
options or derivatives. I would be posting lots of basic and elementary
books/articles for derivative, which happens to be my pet subject. )
http://rapidshare.com/users/FLJUXK

3. Swing Trading.
http://rapidshare.com/users/RMMPEY

4. Technical Analysis
http://rapidshare.com/users/OMJH51

5. Trading
http://rapidshare.com/users/88H5C9

6. Managment ( including money management)
http://rapidshare.com/users/8DABG1

Tax evasion

2006-11-03T03:45:00.000-08:00

The income-tax department has found that certain small companies are misusing the tax exemption available on long-term capital gains. Incidents of such misuse have been found in Mumbai, Pune and Ahmedabad.

"Several instances have come to light, in which small, nondescript scrips are deliberately declaring the dates of the transactions to pass off short-term capital gain as long-term capital gain in the stock market," a finance ministry official said. Long-term capital gains do not attract any tax.

Officials said the misuse of the differential tax regime was particularly seen for transactions undertaken in the financial year 2005-06.

The finance ministry had, in the Finance Act 2004, introduced the securities transaction tax and made changes in the treatment of capital gains. While short-term capital gains were taxed at 10 per cent, long-term capital gains were exempted from tax.

The Act also provided that a dealer in securities would be able to obtain credit for securities transaction tax against the income tax payable on the business income declared. However, no refunds are allowed.

Earlier, an internal report on black money, prepared by the income tax department, had also highlighted the misuse of the preferential tax regime for converting black money into white money.

It had pointed out that some investment firms operating in a regional stock exchange were initially trading at a very low price of around Rs 2 per share, which would later be jacked up to Rs 100 or Rs 200 per share through circular transactions.

Once the price of the share was hiked, shareholders would sell the share and earn capital gains, which would either be taxed at 10 per cent or not taxed at all.

The report had called for differential tax treatment to be restricted to shares of established companies listed in Group A, B1, and B2 of the Bombay Stock Exchange.

IFCI seems to be a turnaround case

2006-10-27T23:20:00.000-07:00

IFCI seems to be a turnaround case. Buying at current price of 13.20 should give good short term profit if it crosses 14.25.

How to become a millionaire?

2006-10-15T00:00:00.000-07:00

Credits: Mr. Gauruv Mashruwala

Everyone wants to create substantial wealth to lead a financially free life. But how to make this possible is the question?

Warren Buffet bought his first stock in the year 1941 when he was 11 years old. In 1943, at an age of 13 he told a family friend that by the time he is 30 he would become a millionaire.

If you are aspiring to become a millionaire then start as early as possible. Even if you do not want to become millionaire but wish to create substantial wealth for you to lead financially free life then start as early as possible. Most of us start earning in our 20s. That first pay in hand gives us tremendous feeling of power – we feel like buying the whole world with it. All our life – till we start earning - we are dependent on our parents for our expenses. Suddenly we have money, which is our own. We can do whatever we feel like. At this time in life we face biggest dilemma. Do we use that power to create wealth for us to use at a later date or do we splurge now. Our decision will decide when and how much wealth we will create. Better option is to save and invest entire earnings. Opposite of that is splurging away the entire pay. There can also be a compromise between the two options.

If we want Rs 100,00,000 (One Crore) at age 60 and if we are 20 years old now, than we will have to save Rs 2864.50 every month. If we delay our savings by 10 years and start at age 30 than to reach Rs 100,00,000 (One Crore) by the time we are 60 we will need to save Rs 6709.79 every month. By delaying the investment by 10 years, we will need more than double the amount reach corpus. Therefore start as early as possible. Another reason to start investing in 20s & 30s is that our financial responsibilities in these years are least. In all probability in 20s we are single and staying with our parents. There is hardly any household expense burden on us. Even after we get married in late 20s, we are just two of us. If both spouses are earning than income of one of them can be easily saved. By the time we reach mid thirties, expenses related to children will start coming up. In late 40s it is higher education of children and our parental responsibilities. Soon you will be in 50s and decade away from retirement.

Once you cross mid to late thirties you will have lots of regular and one time expenses. While earnings go up as we climb the career ladder, expenses also keep catching up.

Lastly, while we are in 20s and 30s we have age on our side and hence we can take higher risk to generate higher returns. Also because there is long working life left, we will get benefit of compounding.

Many of us may be investing for the first time in our 20s. For first timers and investors who do not have time and skills to manage their own investment, mutual fund is the best investment vehicle. Mutual fund gives benefit of professional management, small investment amount, diversification and ease of operation.

Based on our financial goals we can choose debt or equity based investment. Also remember individuals who create wealth are not ad hoc investors. These are people who invest in a disciplined manner over a prolonged period of time. Mutual Fund, through its Systematic Investment Plan, makes discipline investing easy.

20s and 30s are our golden savings years. If we sow seeds of wealth in 20s & 30s we will create huge tree of wealth.

By the way Warren Buffet made his first million in 1961 when he was 30/31 years old.

How does a company manipulate share prices?

2006-10-13T18:54:00.000-07:00

Credits: Ashwin J. Punnen
The Modus Operandi adopted by promoters to manipulate the prices of penny stocks is similar. The Securities and Exchange Board of India (SEBI), which recently strengthened its surveillance department and cracked down on price manipulation, has unearthed a common tactic used by promoters to ramp up shares and sell them to public or institutional players.

In the first stage, the promoters demat their holding as they hold a large chunk of the company’s equity. And then they transfer a part of these holding to individuals and entities close to them through off-market deals. A case in point is Mumbai-based IFSL where promoters transferred about 12% to a set of individuals linked to them. These individuals then trade heavily and create liquidity in the counter and attract retail investors.

During this period, the company makes a flurry of announcements about new plans. In some cases, a stock split is also announced to increase volume and also to make it appear that shares are still ruling lower. The companies, which were making losses, suddenly show a huge jump in sales and profits.

For instance, Mumbai-based Prime Properties whose promoters were banned from trading in the company’s stocks by SEBI, showed a 1888% jump in profits from Rs.10.12 lakh in the quarter ended June ‘04 to Rs.2.01 crore during June ‘05.

Some times handsome dividends are also announced after many years to dupe the investors. “These events are of great importance, not to be dismissed as fortuitous, signifying careful planning and execution, with a view to encouraging and inveigling investors to trade in these shares,” says SEBI in its order promoters of one such company.

Konkan Tyres, another firm where SEBI has taken action, was in dire straits for many years. After eight years, unaudited results for the quarter ended June 30, ‘05 showed a sudden turnaround in performance. The company which was loss making till the financial year ended March ‘05, showed a net profit of Rs.64 lakh during the quarter ended June 30, ‘05, as compared to a net loss of Rs.25 lakh in June 30, ‘04 quarter. In fact, the operation of the company was suspended during the second half of the year ended March 31, ‘04 and the bank had taken possession of all the moveable and immovable properties of the company. The company also announced a set of future expansion plans and bagging some foreign orders. Following the news, the stock of the company surged by over 200% in two months.

In the final stage, these individuals offload stocks into the open market or to foreign funds through block deals. ET had reported that leading foreign funds such as Goldman Sachs, Citigroup, Merrill Lynch and ABN Amro had done block deals in IFSL. Most of these stocks were sold by the entities in whose favor promoters had transferred the shares.

BEWARE OF FRAUDULENT RECOMMENDATIONS !!!

2006-10-13T18:36:00.000-07:00

Credit: Rakesh Singhariya.
Many of the share market investors, traders and even big players are unaware of many ways adopted by so called share market experts and analysts who are recommending shares for purchase almost every day on various websites and through other modes for their own benefit only. The "Modus Operandi" is very simple. Select one company, find out some of its positive factors and start buying for yourself, accumulate it and then recommend it to others as an excellent buy with many superlatives and highlights.

On the day of such recommendations, the particular share will open 8-9% up over the previous days price with a volume of 1000-2000 shares only. After opening, the share price will show hysterical movement with very low volume of 200-400 shares. Every one of you will think that it is really a goldmine which you should also catch without any further delay. Many innocent investors like you start buying at a price near to the upper circuit, which never comes. All of a sudden, you find that its share price is coming down. You think that the price will go up again and at this moment you are trapped. This happens at least in 90-95% cases recommended by many big operators cum analysts who appear in TV Shows, who are always in search of buyers after creating position of 10000-20000 shares in a particular company before recommending it to others.

The unique feature of this game is that they are the only seller in such scripts when you buy hysterically on the day of recommendation. Beware of such recommendations and apply your own vision and mind before investing in such companies.

Some Market Advice

2006-10-13T18:35:00.000-07:00

Never chase a stock.
Buy when markets are in the grip of panic.
Only buy fundamentally strong stocks, which are undervalued.
Buy stocks grown in top line and bottom line over the past years.
Invest in companies with proven management.
Avoid loss-making companies.
PE Ratio and Growth in earnings per share are the key.
Look for the dividend paying record.
Invest in stocks for sure returns.
Stocks have been the high yielding asset class over the past.
Stocks are an asset class.
The basic property of any asset class is to grow.
Buy when everyone is selling and sell when everyone buys.
Invest a fixed amount each month.

Experienced Male Secretary Required

2006-10-13T04:22:00.000-07:00

Experienced Male Secretary required for a reputed company in Khar, Mumbai, please contact Girija on Telephone #2224054858 immediately. Candidates from Western line prefered.

How to open a demat account?

2006-10-10T22:32:00.000-07:00

Demat account can be opened through one of the several authorized banks or financial institutions. You can check your holding online, using the Internet banking facilities of these banks.

Holding a demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments.

In most of the banks, an individual account can be opened resident or non-resident category depending upon the resident status of the applicant.

Visit the following banks with online Internet banking facility who also provide the facility to open a demat account. You can view the instructions and signup with one of them to open a demat account.

ICICI Bank- http://www.icicibank.com
IndiaInfoline – www.indiainfoline.com
HDFC Bank - http://www.hdfcbank.com

What is Demat?

2006-10-10T22:21:00.000-07:00

Dematerialization or "Demat" is a process whereby your securities like shares, debentures etc, are converted into electronic data and stored in computers by a Depository.

Demat has resulted in the elimination of possible mutilated certificates, lost certificates, postal delays and counterfeit shares. Now it is safe, secure and convenient buying, selling and transacting stocks without suffering endless paperwork and delays. You can convert your securities to electronic format with a Demat Account.

Securities registered in your name are surrendered to depository participant (DP) and these are sent to the respective companies who will cancel them after "Dematerialization" and credit your depository account with the DP. The securities on Dematerialization appear as balances in your depository account. These balances are transferable like physical shares. If at a later date, you wish to have these "demat" securities converted back into paper certificates, the Depository helps you to do this.

Depository functions like a securities bank, where the dematerialized physical securities are traded and held in custody. This facilitates faster, risk free and low cost settlement. Depository is much like a bank and perform many activities that are similar to a bank. Following compares the two.

Holding a demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments.

There are many advantages of holding a demat account. A few important ones' are as below.
Shorter settlements thereby enhancing liquidity No stamp duty on transfer of securities held in demat form.No concept of Market Lots. Change of name, address, dividend mandate, registration of power of attorney, transmission etc. can be effected across companies held in demat form by a single instruction to the DP.

A few features of a Demat account are:
Dematerialisation of Securities
Settlement of Securities traded on the exchange as well as off market transactions
Pledging and Hypothecation of Dematerialised Securities Electronic credit in public issue
Receipt of non-cash benefits in electronic form

Remat (Rematerialization)
The process of converting your Electronic holding back to physical holding of securities termed as Rematerialiazation.

Some information about Penny Stocks

2006-10-10T00:53:00.000-07:00

What do you mean by Penny Stocks
If a stock price is greater than 0 and less than Rs.20 then than 20 then it is called penny stock. So as the price indicates these companies are small and very young in their business and might have entered into stock market to raise capital to improve their business. These companies will have the management that is not well known to outside world and usually no information / news is available about what is going on insidethe company. But do not get confused that all new IPOs are penny stocks.Some companies will enter the market after very successful in their domainlike TCS, DLF, Suzlon, etc.

So that means I should not invest in penny stocks?
No it is not entirely correct. You can invest in penny stocks only after doing your research on the company and confirmed news about their business deals. And do remember that today’s penny stocks are may be tomorrow’s big stocks. So it is an art to pick right ones at correct time.

What are the risks associated if I invest in penny stocks?
Usually investing in penny stocks will be considered as speculative.
These stock prices can be easily manipulated either by management or some bad brokerage will sell these stocks at higher prices, so normal retails investors will be affected and loose their money.
Penny stocks usually will fall very fast compared to index stocks when market is going down. This is because in case of big stocks there will be buyers at all stages (these buyers may be institutional investors or FII or HNI or retail investors), but incase of penny stocks you can not find buyers when market is going down because retail investors normally stay out of market when market is going down and also very less interest byinstitutional investors in these stocks so sellers will try to sell whatever price they get and get out of these stocks.

What are the tips to invest in penny stocks?
Invest only after researching about the company, management, business prospects and market trend.
Don’t invest in these stocks because you friend referred it.
Decide the target price before investing and try to book profit after reaching it target price. Don’t wait thinking that the price may go up still because usually penny stocks will fall fast if market is going down.
Always maintain stop loss for these penny stocks.
And it is better get advice from well researched stock brokerage firms.

Nowadays you find so many websites on internet those claim that they recommend you some stocks in the price range from 10 to 30 rupees and will give you higher returns. See the following websites that are recommending penny stocks like 10paisa.com, midcaps.in, etc. My advice is if you want to subscribe tothese websites, you can subscribe but don’t follow their recommendations blindly and do research about the companies and invest. Happy investing.

Some Market Advice

2006-10-10T00:52:00.000-07:00

Complaints against companies/brokers

2006-10-09T20:41:00.000-07:00

Most of the investors at some point or the other face problems related to non-refund of IPO advance amount, excess debited from account, or many other such complaints which either the companies or the brokers are not willing to solve the problems of the investor/traders. For this purpose, I would like to give a suggestion. Now this has been very effective in my case of getting refund order from companies.

The first step is to follow up with the companies correspond with them through emails, letters, etc. Maintain records of such correspondence. Always take acknowledgement for the mails sent.

If after 1 or 2 emails or letters the problems still remain unsolved, send reminders, if it is a company, send a copy to the company's registrar also. Please note that you may also send bcc to various newspapers, but this will be at your own risk since the one thing that the companies/brokers fear is a negative report in newspapers which is read by lakhs of people and people who read newspapers recollect such articles particularly if they are dealing in stock market.

If your complaint is still pending, send another email for follow up, with

cc to tois@bseindia.com and pkb@sebi.gov.in

Along with point 3, please fill the complaint form with BSEINDIA, link of

which is given -

www.bseindia.com/invdesk/arbitration_forms.asp

You can be rest assured that the company/brokers will come back to you to solve your problems at the earliest. Some other links related to complaints are given - www.bseindia.com/about/abintrobse/ingreiv.asp and

www.bseindia.com/contact/index.asp

Cost averaging:

2006-10-08T21:02:00.000-07:00

Collar cost averaging also known systematic investment is a technique to reduce market risk through the systematic purchase of securities at predetermined intervals and fixed amounts. Instead of investing in a lump sum, the investor works his way by slowly buying smaller amounts over a longer period of time. This spreads the cost over several periods, thus providing insulation against changes in market price.

Let us assume you decide to put Rs.100 every month in an investment that is currently selling for Rs.10 per share (for this hypothetical example, let us assume that there are no additional charges). The first month you invest Rs.100 and receive 10 shares. Now if, in the second month, the market falls and the price drops to Rs.5 per share, your Rs.100 buys you 20 shares. The market rebounds in the following month, the price jumps to Rs.10 per share, and for your Rs.100 investment, you again receive 10 shares.
Benefits of cost averaging

Investment (Rs) Share Price (Rs) Shares acquired
Month 1 100 10 10
Month 2 100 5 20
Month 3 100 10 10
Total 300 25 40

Average cost = Rs.7.5 (300/40)

As you can see from the above table, you now own 40 shares after a total investment of Rs.300. The latest price is Rs.10, but the average cost to you was Rs.7.5. While this is just a short-term example, by being disciplined and remaining with the program is the key to the long-term success of dollar cost averaging.

Sure, investing in the stock market has risks. There is always the chance that the markets will go nowhere for the next 5 or 10 years and you shall end up no better than where you started. But then, discipline is a way not to eliminate risks but to minimize them. Regular investing combined with the power of compounding will help you earn adequate returns on your investment over a long term.

Compounding:

2006-10-08T20:58:00.000-07:00

Compounding is a financial phenomenon that makes time and money work in your favor. It is what happens when your investment earnings are added to your principal, forming a larger base on which earnings may accumulate. And as your investment base gets larger, it has the potential to grow faster.

For example, if you had Rs.5,000 in an account that paid 5% annually in simple interest for five years, you’d earn Rs250 a year, for a total of Rs.1, 250 in interest. In this case the interest rate and the yield are the same — 5% per year. But the same Rs.5,000 investment paying 5% interest compounded annually for five years would produce a total of Rs.1,381.41 in interest. Because you are earning interest on your interest, the yield – an average of 5.52% per year – is higher than the interest rate.

The real magic of investing comes when you combine the power of compounding with continuous and regular investments – in other words, discipline. For example, if you start with a amount of Rs.50,000 and add only Rs.250 per month, you would have Rs.180,000, Rs.525,382 and Rs.1.4 m after 10, 20, and 30 years, respectively. No wonder Albert Einstein said that compounding is the eighth wonder of the world.

The Hindu Business Line and your queries

2006-10-08T20:57:00.000-07:00

The Hindu Business Line newspaper is one of the reputed newspaper in the south and they answer queries of investors regularly in their online newspaper, those who wish to can send their queries regarding technicals of a stock, can send queries on not more than two companies, to techtrail@thehindu.co.in

Future Technology - RFID Sky is the Limit

2006-10-08T08:18:00.000-07:00

RFID stands for Radio Frequency Identification, a technology that uses tiny computer chips smaller than a grain of sand to track items at a distance. Radio frequency identification (RFID) is a general term that is used to describe a system that transmits the identity (in the form of a unique serial number) of an object wirelessly, using radio waves. RFID technologies are grouped under the more generic Automatic Identification (Auto ID) technologies.

The barcode labels that triggered a revolution in identification systems long time ago are inadequate in an increasing number of cases. They are cheap but the stumbling block is their low storage capacity and the fact that they cannot be reprogrammed. A feasible solution was putting the data on silicon chips. The ideal situation is contact less transfer of data between the data carrying device and its reader. The power required to operate the electronic data carrying device would also be transferred from the reader using contactless technology. These procedures give RFID its name.

It is a technology that is enabled by a combination of such RFID tags and an open, global network for identifying entities with those tags. With microchips embedded in various types of media, companies can track any kind of good that has an RFID tag attached to it, regardless of whether that product is in the product life cycle or in the supply chain. Such a chip usually contains a serial number identifying a tagged entity, and has an antenna that reflects radio waves back to an RFID reader. The reader converts the reflected radio waves to digitised information that is fed to computers for further processing. This technology is fast evolving as a critical component of an enterprise's supply chain strategy. It offers many benefits including the ability to automate inventory handling, thus reducing labour required, while facilitating the flow and exchange of data as it moves through the supply chain from point of production to point of consumption. RFID provides real-time status and visibility resulting in reduced inventories, improved service levels, lessened loss and waste, and better safety and security.

One grand commercial vision for RFID is to change the way demand-supply chain moves. In the current almost stone-age scenario, manufacturer produces goods based on forecasts and hopes all of them will be consumed before the shelf life gets them. Good, if the market is consistent. Horrible, if a sudden surge makes the supply fall short and hence everyone in the chain miss on profits. Disastrous, if demand dies suddenly and losses are passed along the chain. In a not so distant future, RFID enabled stores will monitor the consumption in real time. Shelf will signal the inventory when it needs more stuff and inventory will pull supplies from the manufacturer based on its level of stock.

Simple concept, not-so-difficult implementation and revolutionary results in the pipeline. That’s RFID, in short.

Advantage of RFID

Active Wave RFID technologies provide unique solutions to difficult logistical tracking of inventory or equipment- particularly in applications where optically based systems fail and when read/write capabilities are required. The technology is stable, and evolving, with open architectures becoming increasingly available.

RFID Benefits vs. Barcode

The optical nature of barcode requires labels to be "by lasers.” That line-of-sight between label and reader is often difficult, impractical, or even impossible to achieve in industrial environments. In order to function properly, a barcode reader must have clean, clear optics, the label must be clean and free of abrasion, and the reader and label must be properly oriented with respect to each other. RFID technology enables tag reading from a greater distance, even in harsh environments.

In addition, the information imprinted on a barcode is fixed and cannot be changed. Active Wave RFID tags, on the other hand, have electronic memory similar to what is in your computer or digital camera to store information about the inventory or equipment. This information can be dynamically updated.

Some of the world's largest product manufacturers have been plotting behind closed doors since 1999 to develop and commercialize the RFID technology. If they are not opposed, their plan is to use these remote-readable spy chips to replace the bar code.

New Investors may have a look at this

2006-10-03T21:55:00.000-07:00

New investors may have a look at this website to get some knowledge about investing. http://www.investment-india.com/investment-basics-home.htm

Trader's Corner

2006-10-03T21:54:00.000-07:00

There are many day trading friends who do not peruse graphs during the trading day. Just watching the price and volume movement is sufficient to tell them which stock is going to break-out and they trade accordingly. The pivot point trading system is designed for the less clairvoyant day traders like us. This is a simple trading system that can enhance the trading of those who do not want to get distracted with intra day graphs.

All that is needed is the previous day's high, low and closing price and voila, we have an entire range of supports and resistances that can be found invaluable in day trading. The USP of pivot point trading is that it is predictive in nature i.e. it can forecast the range for the trading day ahead.

The formula for calculating the pivot point is as follows, R2 = P + (H - L) = P + (R - S1)R1 = (P * 2) - LP = (H + L + C) / 3S1 = (P * 2) - HS2 = P - (H - L) = P - (R1 - S1). H stands for the previous day's high. L stands for the previous day's low and C represents the previous day's close. The S and R are the supports and resistances. Many variations are available for the above formula. Some formulas include the opening price of the current trading day. Other formulas compute more than two supports and resistances.

Free online calculators for calculating the pivot points are available on the web, which can be used to calculate the pivot points. So, how does one use these pivot points? If the price opens above the pivot point and starts moving upward, then a long position can be initiated with a stop just below the pivot point and with the R1 as the target. If the price crosses above R1, that can also be an entry level with a stop just below R1 and R2 as the target. Generally, no buy is initiated near R2, as it is the upper limit of the trading range for the day. In case the price reverses from R1 or R2, it can be the right place to short the stock with a stop just above R1 or R2 with the target being the support just below.

In the similar way, if the price opens below the pivot point, it is a bearish signal and a short position can be initiated with a stop just above the pivot point and the target being S1. Price moving below S1 and moving towards S2 would also be a selling level. Selling is generally not done near the S2 as it is the lower boundary of the day's trading range. Price reversing from S1 or S2 can be used for initiating buy calls with the target being the level just above. Traders who peruse charts can use pivot points in association with other technical tools to decide whether to play long or short.

Technical Analysis

2006-10-03T21:53:00.000-07:00

Those desiring to learn technical analysis can begin their study with the following books: `Technical Analysis from A to Z' by Steven B. Achelis; `Candle Stick Charting' explained by Gregory L. Morris; Martin Pring on `Market Momentum', and `Elliott Wave Explained' by Robert C. Beckman. Books on day trading are: `A Beginner's Guide to Day Trading Online' and `A Beginner's Guide to short term trading' by Toni Turner.

Art of Investing Course in Vashi

2006-10-01T03:54:00.000-07:00

Fr. Agnels’ Business School, Vashi is conducting Second Series of Afternoon and Evening Batches for Art of Investing - A Certificate Course in Online Trading in Shares (Cash and Derivatives Segment) for Housewives / Students / Teachers / Doctors / Lawyers / Retired Persons. Batches commence on October 5, 2006. For further details contact Tel: 27664116 / 27660618. Email: agnelbiz@vsnl.com. For more details visit www.fcrims.com

Midcaps and Smallcaps

2006-09-29T21:45:00.000-07:00

Many of the midcaps and smallcaps are yet to reach the level of May when many of the shares in these categories took a great fall. Investors may at their own discretion sell of those shares which are fundamentally not good. Every opportunity should be taken to sell such stocks whenever such upsurge in Sensex and Nifty is noticed since for such stocks, in stock market you may not a second chance. Those who are in the market, even if they are new investors and got stuck in the May downfall will be trying to sell such junks and one can easily presume that such stocks will not get investors attention as it got prior to May, if there is a strong correction in the future so better late than be sorry.

A word of Caution

2006-09-27T08:33:00.000-07:00

Don’t try to imitate your friend and jump into the bus when the bus is nearing its last bus stop, you might not be able to enjoy the journey. Same is the case of buying stock on tips and rumors from reliable source (most of whom do the vanishing trick if there is a deep correction). Remember you will be left holding the junk stock when the market goes for a deep correction and you will wait endlessly for it to even reach the price at which you bought it but history is proof that it does not reach that level again because most of the people learn by then.

Buy Indraprastha Gas Ltd for Long Term

2006-09-27T00:07:00.000-07:00

Buy Indraprastha Gas Ltd as and when there is a major correction for long term investment. Purchase may be made at around Rs.100.00

Centurion Bank of Punjab – Long Term

2006-09-25T09:36:00.000-07:00

Centurion Bank of Punjab is a stock for the long term. One should buy it when there is a correction and in the event of the stock going down to Rs.20.00. This stock may be accumulated in small quantities when there is a such a correction.

Data you should glance through

2006-09-25T08:51:00.000-07:00

Under the News-Stock I have given two links which an investor can go through, one is the historical data, with this link you can find out the increase of trade over the previous trades, etc. Another is the bhavcopy of BSE.

Market surging up

2006-09-25T06:19:00.000-07:00

Many of you must be having stock which has made loss of more than 50% during the May correction. Now is time to get rid of those stocks which are fundamentally not good and on which you are making even a little profit because if there is a market correction now such stocks will be the first to go down. A wait and watch approach is good if you do not know how to select a fundamentally good and well managed company which is available cheaply.

Tips for new investors when you venture into stock market trading

2006-09-22T19:46:00.000-07:00

Most of the time a new investor enters the market on the suggestion of his friend, relatives who may have made a good amount of profit on his stocks but remember it might be a stroke of luck. It is not necessary that you also profit from your investment in stocks.

Understand the basics of stock investment. You should be able to read the financials, about the company, what PE, etc., means. Never Trade on rumours, investors should always research about the company’s fundamentals, performance, management, etc.

Visit stocks forums, tips sites, websites of stocks to get a hang of how it actually works. If you visit a forum and a regular visitor to such forums you will easily come to know how an investor loses money.

Do not invest your entire amount in one stock, always pick 6 or 7 stocks and from different sectors. Buy in small lots. Always remember that the script of your choice will always be available at a better low price than you can imagine if the stock market were to go in for a correction.

Always have some funds available with you for further purchases.

The mentality of investors is to rush in herd, if a person is selling then I should also sell that is mentality of investors but remember if you are holding a fundamentally good stock then there is no need to worry, the stock will automatically rise when the market goes up and such stocks are the first ones to move the market.

Always have a target. If your target is reach sell at least half quantity and for the remaining stocks keep a watch on the movement of the stocks.

Note:
During the recent meltdown in the stock market, many investors rushed in to sell their stocks and created a panic which naturally many led others to sell but remember during all these upheaval there were many who just kept quiet and did not sell even thought their principal amount eroded more than 40%, these people in turn bought stocks from the market at throwaway price when then were down and by now are into some profits so patience gets rewarded.

Going up and up

2006-09-21T09:22:00.000-07:00

Now the market is going up day by day but remember volatility is still there in the market. Retail investors have to be more careful in choosing companies that are backed by strong financials and backed by efficient management teams. The current situation warrants that one needs to be careful if one is a short term investor, since its upward move lots of companies with weak financials are again inching forward, for the long term investors choosing fundamentally good company is the key to good returns in the future. Even investing in fundamentally good company, one should follow certain principles, never buy in one lot, buy in small lots, don’t worry if the scrip falls since it usually picks up when the next upward movement starts.

Reliance Petrolium

2006-09-18T22:58:00.000-07:00

Reliance Petrolium is a good buy for long term at a rate of Rs.50-60. The buy would be possible when there is a correction in the market and efforts should be made to buy 25 to 50 shares at each and every fall. Expect good returns after a period of 4-5 years.

Send your resume to more than 500 placement - Free Service

2006-09-16T04:26:00.000-07:00

If you are interested in sending your resume to more than 500 placement services in Mumbai, please send me your resume to helpingtogetajob@yahoo.co.uk. Please note that this service is only for candidates who are based in Mumbai.

Investment Funda

2006-09-15T21:43:00.000-07:00

One should get onto the investment vehicle at an early age but it does not mean that you cannot get on to the investment vehicle at a later stage but getting into the investment vehicle at an earlier age ensures that even if you go through the ups and downs you are still able to pick up from the scratch. Guys who land their first job should start thinking about investments and put aside a small amount for investment in shares. Now this amount need not be invested in big companies but you can invest your money in fundamentally good companies whose market price may be below Rs.20 also which in layman’s term is called penny shares. Remember Infosys Technologies was going at a rate of below Rs.50 and now it is one of the best scripts in the market.

Goldmine for some

2006-09-15T21:42:00.000-07:00

I remember a case where this guy purchase 1000 shares of a certain company at around Rs.40 some years ago and this purchase was made after some recommendations by some friends and later on this guy completely forgot about the share that he was having and did not bother to follow up with the events happening with the company. After many years, when the bull phase started he remembered about this 1000 share that he was holding in physical form and came to know that the value of the stock that he was holding is currently 1,750.00. You can imagine his surprise but remember all of us may not be that luck but at least one should try their luck.

Retail Investors be careful

2006-09-15T21:23:00.000-07:00

Retail investors should be careful. You might have noticed that the market is still undecided whether to go up or down. At this juncture, one needs to be very careful. Those who are holding stocks and whose stocks have fallen in the last month’s correction should try to sell the stocks if they are in it for short term and wait and watch for another correction to enter the market.

Gujarat Ambuja Cement

2006-09-15T09:40:00.000-07:00

Gujarat Ambuja Cement is one of the stocks in Cement Sector which has got the fancy of investors. An entry at Rs.90 level can be made as and when the next correction happens. It shows promising long term investment bet.

PAN Card is compulsory for dealing in shares

2006-09-14T19:41:00.000-07:00

Investors are compulsorily required to submit PAN Card details to the brokers before 30th September, 2006 otherwise their accounts will be deactivated by the brokers. It is a very simple form of 2 pages and easy to fill. Some banks and people are charging Rs.500/- for filling the form. Investors need not pay such huge amount for just filling the form, it is a simple procedure which can be done by the investor.

Retail Investors should be careful

2006-09-14T19:07:00.000-07:00

Retail Investors who are either in the market and plans to invest their hard earned money in stocks for short term as well as long term should be very careful and cautious and should invest in such stocks, which provides sufficient upside and most of all should know when to enter the market and get out of the market. Most of the time small investors enter the market when the script price is almost at the upper side and when there is a correction the script price falls sometimes even 60%.

My blog on Indian Stocks and Indian Placements in various companies

2006-09-14T07:44:00.000-07:00

Hi, My main purpose of this blog is to give tips on stocks and placements in various companies in Mumbai. Hope you like my blog.