Day Trading is Easy : Conditions Apply!!

Day trading is not Day dreaming..!

90% of all day traders fail in stock market." bitter truth But how many of them give serious efforts to earn in day trading? How many of them give as good input as they give for any other business? How many of them treat it as full time business and not as a refreshment break? Well, you may find your answer in rest 10% people who doesn’t fail in day trading.

“90% people do not make money in day trading!!!”

Most of the people think, it is one of the easiest jobs one can have. Myth! If you think that day trading is “easy money” then I will request you just take all of your savings and light it in a bonfire as soon as possible. It will be much less painful for you. Someone told me on my very first day of day trading that no one can earn in day trading. After trading for some years in this market i would like to ask that person, have you ever thought why most of the people in day trading don’t make money? Most of our “why” can be answered if you ask “why not”! We will try to find out answer for “why not” in this article.

“90% of all day traders fail in stock market.” bitter truth But how many of them give serious efforts to earn in day trading? How many of them give as good input as they give for any other business? How many of them treat it as full time business and not as a refreshment break? Well, you may find your answer in rest 10% people who doesn’t fail in day trading.

Failure is part of life. Agree. But if you do not learn from your failure… it becomes your life! There are some common certain characteristics of such failed stock traders. Let’s have a look at them.

1. Opportunity cost is high:

Leaving your job or business for day trading is one of the most common problem with day traders who fails. When you leave your job for day trading you are making two mistakes. One, you are compromising fixed income for some future income which is not sure. Two, you are taking extra stress on yourself to get something from your day trading. At initial stage, do not expect day trades to give you daily meal. You should not be “depended” on your day trading success at initial stage.

Golden rule: if you are switching your business to day trading then you should have 9 months back up amount in your bank locker for survival if you do not earn a single penny in next 9 months.

2. Lack of professionalism:

People become lazy when they think trading is easy. I would say trading is not easy. Even if you have the best guidance in stock market you should give your efforts too. when you have some consultant in stock market you are buying professional service from them, they will give you 80% of your requirement for making profit, but rest 20% you have to give if you really want profit from day trading. As per my knowledge you should give at least 3-4 hours for your homework before clicking any trade on your keyboard. I would like you to read the last line again.

Golden rule: Don’t get into day trading if you aren’t prepared to treat it seriously.

3. Lack of system:

When day trader enters trading room most of the time he does not know what will he do after 10 minutes. He does not have any system to work upon. He will sit in chat room and he will trade on “tip” or he will simply follow what other people will do. It can be very dangerous as he does not even know where he will reach at the end. Do not forget to analyse your trade every day. Be critical of yourself. Analyze your trades and find the reason why you made them. Do your profit / loss numbers each month. What’s working? What isn’t working? Do you need to change your plan?

Golden rule: Make some rules and develop a system for yourself and work within that system.

4. Ignoring tools of trading:

If you are going to be a successful trader, then you need the proper tools. Proper computer setup, proper phone line set up, good Internet service provider, proper charts setup. This is a business, and you need to invest in yourself in order to be successful. Your chair should not be in bad shape, your computer system should not have any virus, your room when you trade should not have any disturbance. Remember, your mind is your asset when you work as a day trader. If you ignore your comfort levels, it may cost you very high. You can surely perform better if you treat yourself better during market hours.

Golden Rule: Update your tools every weekend.

5. Lack of Schedule:

Generally, day traders work from home. It makes them a bit lazy. You cannot be on-line at 9:45 AM if your market will open at 9:55 AM. Day trading is not fun. One single news you miss about a stock which you planned to trade and you will get loss for that day. Do not expect to be a successful trader if you have such mentality. You should understand one thing clearly that day trading is full time job.

Golden rule: Plan to be at your desk one hour before the market opens and one hour after it closes.

6. Lack of confidence:

Well, have you ever thought about your non performing trades? More than 50% of our non performing trades are due to lack of confidence. When you trade, make yourself very clear about that trade. It should have fixed stop loss, fix target, time frame,investment, maximum return, maximum loss and weight of the trade on your total volume of the day. It will give you very clear picture about the end position of the day. When trader doesn’t know what will happen to him if trade goes right or wrong he feels panic easily and can do wrong trade. Again i would say do not forget to analyse your trades. It will show where you went wrong and what works for you.

Golden rule: Make your daily budget before you start trading. You should know how much turnover and how many trades you will do on particular day

7. Lack of safety net:

You need to be able to trade without thinking about how you are going to pay your kid’s school fees. Most of the traders do not have such safety net. You need at least nine months worth of expenses set aside. If you are 100% depended on your income from stock exchange it will completely affect your confidence and negatively impact your returns.

Golden rule: Prepare yourself. Prepare financially, prepare mentally.

This post is Collected From other Website(i posted it just for knowledge purpose)

15-12-2009

As told earlier 5181...Huge huge Resistance.....see how on friday how nifty dragged down from 5182 levels

As of Now...Short call of Ranbaxy was covered @ 497 levels......shorted at 513 .....with profit of almost Rs 13000/-

I have Advised again to short Ranbaxy, Today during closing Time @ 519 levels

Keep an Eye on JINDALSWHL (CMP 1652.70)......Buy on dips is advisible

For VSS Securities & Investments

Aditya Singh

10-12-2009

Hi,

This Are Calls for 10-12-2009....Trade at your own risk


IVRCL Infra

Buy above 381 for a target of 385 - 388 and above 390 can touch 395.40
Stop Loss - 376.70

Sell below 373.15 for a target of 369.50 - 363.80 and below 360 can touch 358.10
Stop Loss - 379.50

Reliance Industries

Buy at 1071 target 1075 - 1079 and above 1080 can touch 1083 - 1086 +
Stop Loss - 1067

Sell at 1066 for a target of 1063 - 1059 and below 1057 can touch 1054 - 1051 -
Stop Loss - 1070

Tata Steel

Buy at 550 for a target of 555 - 559.40 and above 562 can touch 566 - 572 +
Stop Loss - 545

Sell below 543.80 for a target of 537 - 532 and below 530 can touch 528 -
Stop Loss - 548

Jindal Steel

Buy at 726 for a target of 731 - 735 and above 738 can touch 741 - 746 +
Stop Loss - 722

Sell below 720 for a target of 715 - 710 and below 708 can touch 705 - 700 -
Stop Loss - 725

PVR LTD

Buy at 185.18 for a target of 187.80 - 190.30 and above 191 can touch 194
Stop Loss - 182

Sell at 180 for a target of 178.90 - 176.35 and below 175 can touch 173.70
Stop Loss - 184


Happy Trading

For VSS SECURITIES & INVESTMENTS
Aditya V Singh
+919819198001

Yahoo ID - VSS_SECURITIES

Nifty View

As said on 21st Nov....if Nifty holds above 5050...we can see New Year High....And It stayed Above 5050...And Made NEW YEAR HIGH on intraday basis, later draged from previous high of 5181, Seems Some one has shorted heavily at 5181 levels

Now 5181 Will act as HUGE HUGE RESISTANCE, Updise targets can be seen as 5480-5625-5800 if we cross 5288..........if we don't close above 5158........then chances of downside are more

As per my view, u should hold on cash and buy at every dip is good strategy, Technically Nifty should fell to 4600 levels, i am waiting for it

I have advised my clients to Short RANBAXY at 513 , and we are waiting for 4600 levels to build a good portfolio

For Any queries or help regarding any stock mail me at VSS_SECURITIES@YAHOO.COM

Yours Truly

Aditya V Singh

+919819198001

Market for Coming Week

From last 3-4 Days i am trying to blog my view, but couldn't get time due to hectic schedule

As of now Nifty is place in a critical mode.....Fridays pull back had surprised many players(All credit goes To Dr Manmohan Singh)....Now people are talking of 5150-5200-5400......Lets See

Since October 2009, Nifty is trading in a range of 4680-5180....And Since Friday'a Closing (5052) is at upper level of trading range...this can be seen as bullish consolidation may break on upside

Nifty has retracted more than 50% of the recent fall happen in Nov 1st week.....If Nifty stays above 5050.....we can see a NEW 2009 HIGH( May be around 5250).

Any Movement above 5250....Can take nifty to 5400-5700 levels(in Near Term)

Down Side Nifty has a good Support @ 4900 levels .....As 20 DMA & 50DMA are lying,

Conclusion:

For Short term traders, Wait and watch, and if nifty does not sustain above 5050....short Nifty With 5100 as SL for target of 4900

Long Term Investor who want to build a good portfolio can wait for a dip till 4500-4600 levels...that will be probably the last Fall before Market hitting All time new High.....

Happy Trading,

For VSS Securities & Investments

Aditya V Singh

+919819198001

20-11-2009

Buy

IDBI @ Opening with Stop Loss of 118

HDIL 342-344 Opening with Stop Loss of 340...Trg 348(T1) 352(T2) 360(T3)

Happy Trading

19-11-2009

BOC INDIA (BUY) 175-176 (Target1) 179 (Target2) 181 & 184+ (Sl) 172


PRAJAY ENGG (BUY) 32.9-33(Target1) 33.5 (Target2) 33.9 (Sl) 32

OIL COUNTRY (BUY) 127-128 (Target1) 130 (Target2) 133 & 135+ (Sl) 124

JSW STEEL FUT (BUY) 945-948(Target1) 958 (Target2) 967& 985+ (Sl) 940

Crucial Level For Nifty

Hi,
Today our clients Booked Nifty @ 4905.....I had given a target of 4910.....And todays high was 4909.70..............We are in long position from 03/11/2009 from 4570 levels....we earned almost 335 Points in single lot in 6days ie Profit of Rs 16750/- in single lot.....

For me, now onwards Nifty is in NO TRADE ZONE....Now i will be carefully watching next 5-6 sessions, it will decide further trend for the market....as of now OI, VOLUMES are suggestings nifty Dragging below 4700 .....(Its Just a View, Trade as per your own risk)

As i have mentioned earlier as 4630 as 100DMA, and told that nifty can bounce from here, And Nifty gave a good bounce from these levels and rested @ 4875-4900 (its 38.2% Retracement of the fall) or can move to 4990(61.8% Retracement).........Either of these 2 points can can be last top before nifty to fall downwards to 4450-4520 Levels

Closely watch my blog, i will be giving a short call very soon

Happy Trading,

VSS SECURITIES & INVESTMENT

ADITYA V. SINGH

Book Nifty

Hi,

Book Nifty Near 4850...We are long from 4570.....in 3 Days we have earned almost 200+ points.....Very Risky Traders can keep it for 4910 Target

Also partial book our Positional long Calls of

Rcom

Rpower

Alkali

Regards

Aditya V. Singh.

Market View For 05/11/2009

Tommorow Nifty will be very volatile......Above 4700, nifty will be heading to 4750...were it will be welcomed by 4747(Resistance) Lets see kya hota hai.

If Nifty Breaks 4530/4950 in November......We will see more movement in Nifty......So i will be closing watching these levels for November

• 4530(Support)
• 4630(100DMA)
• 4747 (Resistance)
• 4850(Resistance)
• 4975(Resistance)

Happy Trading

For VSS Securities & Investments

Aditya V. Singh

+919819198001

Profit of 04-11-2009

HDIL Hit Target3 of 315.....Profit of Rs 20/-

RelCap Hit Target3 Of 730.....Profit Of Rs 35/-

ICSA SL Hit Of 155..........Loss Of Rs. 5/-

Total Profit Rs50/-

Running Profit in Nifty is 141 Points for November Month

Move TSL to 4670

Safe Traders can book nifty @ 4670...Risky Traders Move TSL in Nifty @ 4670.......Already We are in profit of 100 Points.....

Calls For 04-11-2009

Buy

HDIL Above 295 T1 (302) T2 (308) T3 (315) SL 288

ICSA Above 158 T1 (161) T2(165) T3 (167) SL 155

RelCap Above 700 T1 (708) T2(720) T3 (730) SL 695

Positional Buy(For 2 Weeks)

RCom Above 167 T1 (185) T2(198) T3 (210) SL 149

Rpower Above 138 T1(160) T2 (172) T3 (187) SL 125

Alkali Above 139 T1(165) T2 (175) T3 (200) SL 130

Buy Nifty Positional

Buy Nifty Positional @ 4570....SL 4500.......Target1 (4700) Target2 (4850) Target3 (4900)

Cover Buy Nifty Call

Now Keep TSL @ 4710....already 50+ Points Profit...........

Nifty 4630

Yes,

Nifty 4630 is 100DMA and nifty had bounced many times from here, so i am also expecting a slight bounce from here, Cover ur Nifty short call @ 2days Opening......and Go long WIth 4610 as SL

Aditya V. Singh

Cover Nifty

Cover Nifty buy Call....Nifty already 80+ Points up.... and short nifty here 4825-4840 for trg of below 4700

Buy Nifty

Buy Nifty for short term for 100-150 points Bounce with stop loss @ 4700

CALLS FOR 22-10-2009

BUY

ZUARI INDS 406-408 (Target1) 416 (Target2) 422+ (SL ) 400


SANGHVI MOVERS 204-206 (Target1) 209 (Target2) 217+ (Sl) 199

ROLTA 185-187 (Target1) 190 (Target2) 195+ (SL ) 184

HAPPY TRADING

VSS SECURITIES & INVESTMENTS

CALLS FOR 20-10-2009

BUY (20-10-2009)

NIIT TECH 125 - 127 (Target1) 130 (Target2) 133+ (Sl) 122

CAIRN INDIA290 - 292 (Target1) 296 (Target2) 300+ (SL ) 287

LANCO INFRA 565 - 567 (Target1) 575 (Target2) 580+ (SL ) 560

STERLITE TECHNOLOGIES 315 - 316 (Target1) 323 (Target2) 328+ (SL ) 309

HAPPY TRADING

VSS SECURITIES & INVESTMENTS

Error Of Judgement

In my Article posted on Night of 14th Sep,2009..... i have strongly voted to short nifty for a trg of 4600-4500, and also told to buy Oct 4500pe

For the last One and half Month, I have stuck onto my decisions of Nifty short , I accept that there was slight error of judgement for last 200 points in Nifty....I still stick to my decisions and continue holding the same view that we will definitely see the lower levels of 4500

Market always Behaves opposite of masses.....and at that time maximum people were short in Market....and naturally marketed reacted OPPOSITE TO MASSES....Now maximum people are bullish on market for 5250-5500.........GOSH......Lets see what game is laid

Still my many clients are holding short positions as per my view.....I have advised to hedge with some Reality Stocks when nifty crossed 4950....

For Any further clarification please contact me on

VSS_SECURITIES@YAHOO.COM

For VSS Securities & Investments

Aditya V. Singh

Mahurat Picks- Samavat 2066

Company Target

Bharthi Airtel 455

Anant Raj Industries 180

Canara Bank 445

Bank Of Baroda 590

Dhampur Sugar 125

India Hotels 105

Thanks

VSS Securities & Investments

Aditya V. Singh.

+919819198001

Why the market just loves Fridays

If stock market data is any indication, traders have made more money on Fridays, the closing day of a trading week, than on any other.

Over the last five years, the BSE Sensex, for one, has given an average return of 0.17 per cent on Fridays.

Talk about last minute rush and the resultant increase in activity on the counters; or a perception that one knows better at the fag end of the week.

Therefore, here's a hot tip day traders could take -- never miss the action on a Friday.
On the flip side, Mondays are the bleakest. Over the last five years, the Sensex has given an average return of just 0.06 per cent on Mondays, the lowest for any day.

That makes for a second tip, perhaps -- give Mondays a pass if you want an extended weekend. Also, the markets tend to be the most volatile on Mondays, meaning price fluctuations are the biggest on this day.

In terms of standard deviation, a measure of volatility, in the last five years, the Sensex has swung the wildest on Mondays (2.37 per cent), followed by Friday (2.08 per cent). Wednesday, Thursday and Tuesday have seen standard deviations of 1.84 per cent, 1.73 per cent and 1.67 per cent and returns of 0.13 per cent, 0.07 per cent and 0.09 per cent, respectively.

There again, on a risk-return ratio basis, there's nothing like a Friday if you are a day trader.

Call it the "weekend effect" if you will, or the "day-of-the-week effect."
It's the same for the Nifty as well -- Fridays have the highest returns (0.17 per cent) and Mondays the lowest (0.05 per cent).

The trend, in fact, holds for markets the world over.

"Published research for the United States and Canada finds that daily stock market returns tend to be lower on Mondays and higher on Fridays," Syed A Basher and Perry Sadorsky of York University write in a research paper titled 'Day-of-the-week effects in emerging stock markets'.

This is primarily attributed to companies releasing unfavourable news over the weekend, when the markets are closed.This news is reflected in the stock prices when the markets open again on Mondays.

“The stock market is always there. It has been there for centuries, and it lives longer than anyone of us here. Therefore, don’t rush and trade all your capital like there is no tomorrow.”

SHORT SHORT NIFTY

Charts are showing negative divergences in weekly charts (RSI,MACD). Weekly stochastics have moved into the overbought region. In the last 3 trading sessions, daily stochs has moved from the oversold to bought territory

Nifty has crossed 61.8% Fibonacci retracement of the entire fall of 2008 and now entered into a buying phase (for most retailers) while Sensex didnot and is currently just holding onto that level

What i am Seeing is Maximum 100-125 Points Upwards(Rare Case)....Then straight Down Trend To 4500-4600 Levels

Price Vs Volume

How should one apply Price vs. Volume change for predicting market behaviour?Technical Analysts believe that price and volume are closely related. There are four rules for Price vs. Volume change:

1. A rising index with an increasing volume will indicate a bullish market and a "buy" signal as it reflects unsatisfied demand in the market.

2. A falling index with decreasing volume shows a bullish signal.

3. When volume tends to increase during index declines, it is a bearish signal.

4. When volume tends to decrease as the index rises, it is a bearish signal.

There are few traits of good trader

Humility – Getting your ego out of the game
Discipline - stick to your own system
Vigilance – Protecting your capital
Courage - fears are heavy burden to carry through life
Realism - you have control over yourself but you don’t have control over the markets.
Perseverance – trading winners are very rarely born, they are developed.
(So you can become a good trader)
Focus on being - the result of your trading all begins and end with you, the captain of the ship

You are the master of your destiny
Never try to impose your will on the market.
Develop your trading systems, trading style

Power Of Sensex

Hi

Just wanted to share a very positive statistic on the BSE.

As at January 8 2009, the Sensex had closed at 9071, a far below from 20873 on January 8, 2008.

Now, even if it took 5 years (Jan 2014) for Sensex to reach its previous high, the return would be 18.14% (CAGR).

If it took 7 years (Jan 2016), it would be 12.64%.
And even if the sensex reached that figure in Jan 2019 (10 years), the returns would be 8.69%.

"So invest in Share Market than any other investment"

Stocks are likely to face a severe de-rating on the stock markets - CLSA

After the Satyam debacle we would like to inform the members of
to look into the report of CLSA which mentions top 15 stocks
which may face severe de-rating . We would advice members
not press the panic button and sell stocks in losses , it would be
better idea to stay away from markets for few days. we will be
updating you all on the latest developments.

1. Anantraj Industries:

A North Indian commercial developer, transferred part of one of its
projects (0.52mn sf out of 0.75mn sf in a mall in Delhi) to its wholly
owned subsidiary and consequently showed equivalent revenues in its
standalone results (93% of 1QFY09 revenues).

As against standalone revenues of Rs1.72bn and net profit of Rs1.52bn,
consolidated revenues are Rs104.8m and net profit of Rs77.6m. Out of
the consolidated revenue of Rs104.8m, Rs68.05m (65%) is from the
ceramics business.

2. DLF:

DLFs non-DAL revenues declined 44% QoQ to Rs22.5bn and around 40% of
sales have been to DAL, a group entity. 44% of debtors are DAL and of
total debtors, the share of DAL has increased during the quarter with
DAL receivables increasing by Rs14.5bn QoQ.

During 1QFY09, sales to DAL were Rs15.6bn, which is marginally higher
than the increase in receivables from DAL. We would like to add that
DLFs high level of transactions with group company DAL and high level
of receivables has been a point of debate since it went public.

3. Dr Reddys Labs:

Dr. Reddy's has adjusted mark to market losses on outstanding US$250m
of hedges in balance sheet, while P&L reflects forex gains realised.
The company also reclassified its contract manufacturing business
(CPS) revenues into API and Formulations, which makes it difficult to
analyse its segmental performance.

4. Himatsingka Siede:

Himatsingka in one derivative contract had mark to market losses of US
$41.5m as on March 24, 2008 and no provision has been made since the
company has filed a case in court against the concerned bank. In case
of another derivative contract, mark to market loss of Rs1.58bn as on
30th June has not been provided for since the derivative contract is
still open.

5. HCL Tech:

HCL Tech has normally had a very large hedge position compared to its
revenue base. While the rupee was appreciating, the company reaped
benefits of this and reported US$79.2m in Forex gains in FY07. The
company has always maintained that it would prefer to lock-in a
constant INR/US$ rate through hedging rather than suffer from the
currency volatility.

However, the company unwound US$540m of hedges in Jun-08 and booked
large Forex losses. We find this change in Forex policy surprising and
the company has likely brought forward its potential FY09 FX losses to
4QFY08 through this change in policy.

6. JP Associates:

Jaiprakash Associates did not provide for FX losses on outstanding
FCCBs of US$400m through its P&L and plans to provide for the FX
losses/ gains at the end of the year.

7. Jet Airways:

Jet Airways changed its depreciation policy from WDV to SLM, and
thereby wrote back Rs9.2bn into its P&L, which helped the company to
report profits during the quarter. It also helped Jet to report higher
net worth, which will help in keeping reported gearing low. This is a
one-time exercise. Jet also capitalised Forex loss of Rs6.2bn on Forex
debt and adjusted it against carrying value of fixed assets.

8. Prajay Engineers Syndicate:

Hyderabad based developer, reported a loss in its fourth quarter
results against expectations of a profit. The company "lost" records
for a project worth 40% of its annual revenues at the site office.

The company in its press release said - "After the year end, basic
records relating to sale agreements / revenue and construction
expenses of one of the Projects of property development were lost at
the site office, Vishakhapatnam. The auditors in their report have
stated that they were not able to verify the books and records
relating to income of Rs1437.71m and relevant construction cost of
Rs752.654m. Management is making all efforts to locate/ retrieve the
lost records."

9. Ranbaxy:

Pharma major has mark to market losses of Rs9.09bn on forex derivative
contracts, which have not been provided for because the company
believes "the gain on fair valuation of underlying transactions
against which the derivative transactions were undertaken amount to
Rs10.3bn." This argument is against the principles of conservative
accounting wherein mark to market losses are being offset against
assumed future profits.

10. Reliance Communications:

Telecom Company has adjusted short term quarterly fluctuations in
foreign exchange rates related to liabilities and borrowings to the
carrying cost of fixed assets. The company adjusted Rs1.09bn of
realized and Rs9.55bn of unrealized Forex losses in the above manner.

In addition, the company has not recognised Rs3.99bn of translation
losses on FCCBs, since the FCCBs can potentially get converted,
although the FCCBs are out of money. Adjusted for all the above, the
company would have virtually no profits in 1QFY09.

11. Reliance Industries:

In continuance of its policy, adjusted "foreign currency exchange
differences on amounts borrowed for acquisition of fixed assets, to
the carrying cost of fixed assets…which is at variance to the
treatment prescribed in AS11." Had AS11 been followed, profits for
1QFY09 would have been lower by Rs9.4bn (23% of reported net
profits).

12. Sobha Developers:

South Indian developer changed its accounting norms in 1QFY09 for
revenue recognition which facilitates revenue being recognized earlier
in a project cycle. According to its press release, if the accounting
policy had not been changed, the company's 1QFY09 PBT would have been
lower by 20%.

Excerpts from the company's press release: "With effect from April 01,
2008 the Company has changed its accounting policy for revenue
recognition for sale of undivided share of land (group housing) on the
basis of certain minimum level of collection of dues from the customer
and / or agreement for sale being executed rather than criteria
relating to the project reaching a significant level of completion to
align it with revenue recognition policy for sale of villa plots.

This has been resulted in additional revenue recognition and higher
profit before taxes of Rs321m and Rs150m respectively during the
quarter ended June 30, 2008."

13. Tata Motors:

Company has transferred 24% stake in Tata Automotive Components
(TACO), a company with revenue of US$675 in FY07, to Tata Capital, a
group company, and booked profit of Rs1.1bn in 1QFY09. Management has
declined to disclose the valuation methodology.

Senior management of Tata Motors, in a conference call with analysts,
said, "I would not be able to share with you the specific valuation
methodology, except to say that the things are done by an independent
reputed firm and based on the company's track record and the future
business opportunity."

Tata Motors has also changed its methodology for calculating
provisions for doubtful receivables, which resulted in higher reported
EBITDA to the extent of Rs507m (10% of EBITDA).

14. TCS:

The software major increased its depreciation policy on computers from
2 years to 4 years. As a result, 1QFY09 PBT was higher by an estimated
Rs500m (c.4% of net profit in 1QFY09). TCS follows cash-flow hedge
accounting and till FY08, it used to recognise hedging gains on
effective hedges in its revenue line, thus boosting the reported
revenue growth and EBIT margin.

In FY08, TCS had Rs4.21bn from hedging gains, of which, Rs1.37bn was
included in the revenue line. However, from 1QFY09, TCS will report
all Forex losses/gains below the EBIT line in other income. Thus the
losses it had on its hedge position will no longer be booked in the
operating line.

15. Zee Entertainment:

Media company withdrew its buyback offer "for the time being" without
assigning any other reason. This happened after SEBI made it mandatory
that companies will have to complete the entire buy back within the
stipulated time, if the stock is trading below the maximum buy back
price at the end of the buyback period and the buyback amount has not
been completed.

Safe Harbour Statement:

Some forward looking statements on projections, estimates,
expectations & outlook are included to enable a better comprehension
of the Company prospects. Actual results may, however, differ
materially from those stated on account of factors such as changes in
government regulations, tax regimes, economic developments within
India and the countries within which the Company conducts its
business, exchange rate and interest rate movements, impact of
competing products and their pricing, product demand and supply
constraints.

Nothing in this article is, or should be construed as, investment
advice.

Calls For 07-01-2009

Sell ICICI Bank at opening SL 507 Tgt 483-477

Sell Nitin Fire at opening SL 219 Tgt 206-198

Financially, the worst is over

Article Published In ET on 05-01-2009

In 2008, financial markets around the world were a casualty of Murphy's Law - anything that could go wrong, did go wrong. Indeed, many things went terribly wrong.

Yet 2009 holds promise for emerging countries, including India, say financial market pundits.

Investor money will once again start flowing into India, says Jeff Chowdhry, head of emerging equities at the London-based F&C Investments. He believes while foreign large institutional investors are slightly biased towards China right now, the flip side is that, compared to India, the Chinese economy is more dependent on exports and the health of the US economy.

“The year 2009 will be one of volatility with two competing forces at play — global recession on the one hand, and the cash piles with fund managers, on the other. With central banks across the globe pumping in money, lot of it will find its way into the emerging markets. We will have short term money coming in by end-2009, whereby we could see markets end 30-40% higher from its current levels," Chowdhry said.

In 2008, foreign institutional investors pulled out $11 bn from the Indian equity market. So it may not be easy to reverse the flow in 2009. Portfolio investors say any recovery in India will have to be preceded by an overall improvement in market sentiment globally.

Yet the worst seems to be over, says the head of global financial services firm Morgan Stanley’s India arm Narayan Ramachandran. He believes the liquidity-boosting measures taken by central banks around the world would take effect by the second half of 2009. “There may be some small amount of pessimism left, which could play out in the next earnings season. However, the deluge of bad news and fear is behind us,” he added.

The recovery won’t start from equity markets however, as they are typically a dipstick for the overall mood in an economy. Other financial markets may need to recover before share prices start climbing. The credit market, for instance, may be among the first to start looking up, says Jyotivardhan Jaipuria, managing director and head of research at brokerage DSP Merrill Lynch. “This is the signal that the equity market will respond to, for it is a clear sign of increasing risk tolerance. Thereafter, one could see a reciprocal effect on equity and commodity markets,” he said.

“One factor in India’s favour is that it still has one of the best growth rates in the world. However, between Brazil, Russia, India and China, China is clearly preferred over India, given that China’s YTD (year-to-date) performance is worse than India,” he added.

Jaipuria believes there are two factors driving investor preference for China over India. First, India runs a large fiscal deficit and current account deficit unlike China, making pump-priming difficult. Secondly, the political fallout of elections here may make swift government action difficult.

Meanwhile, what should you do with your money in 2009? Morgan Stanley’s Ramachandran says a large share of the extra cash will find its way into gold and the credit markets. “Pockets of emerging markets” would benefit, he says. F&C is advising its clients to put money to work and expect returns only over two to three years.

Jaipuria recommends buying on bad news. He is optimistic about the prospects of telecom and drug companies, along with state-run banks. But for the long term, he is betting on automobile companies.


http://economictimes.indiatimes.com/articleshow/3935296.cms

Risk And Return

When the investor want to invest his money at a higher rate of return there is a higher factor of risk. As we would be exposing our money to the markets (equity, debt, etc.) and their associated risks. Further, the higher the risk taken, the higher is the expected return. In the bank the money is exposed to no risk, so the return is just at about the inflation rate. In contrast the risk in equity markets is the highest, and the expected returns would also be the highest. Before exposing ourselves to the markets, we can apply common sense and our learning to reduce this risk to acceptable levels.

There are 5 economic factors that affect equity returns, which can be classified under the 4 types of investment risk.