Monday, November 20, 2017

Multibagger 2008 - 2017









Thursday, November 16, 2017

Stock Price Movement - Can You Predict Whether the Share will go UP or DOWN | HINDI









******** 7 Points for Stock Market that Stock Price will go or down ********
1. Price, Volume, Delivery Percentage Increasing togather (Should be Greater than 60)
2. Fundamental Analysis - PE, Divident, Book Value, Balance Sheet, Income Statement
3. Volume Breakout - Stock is Jumping in Huge Volume.. - Popular website par data mil jayega
4. SMA/EMA - should be Greater than 200 (for short term 30 and 50)
5. Future and Options ka Data - Stock me sentiment kya hai?
6. Candelstick Pattern - It will help to know the Trend [Look for reliable pattern, baware of fake pattern]
7. Human Intelligence should be very importen for analysis of Stock




Stock Price Movement is difficult but not impossible to predict. A success ratio of 75% is good enough to generate profits from equity investment. It requires comprehensive analysis to understand the stock trading.

In this video Stock Price Movement - Can You Predict Whether the Share will go UP or DOWN, i have shared the 7 most important points that can help you. One of the key points is the correlation between volume, stock price, and delivery %. Besides that, it is important to do fundamental analysis of the stock. On the technical side, you should check the volume breakout, simple moving averages, and reliable candlestick patterns. The future and options data is also reliable depending on your conclusion based on the same.

Lastly, without human intelligence, you cannot predict stock price movement correctly. Only human intelligence can help you in arriving at a correct conclusion or right direction. 









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Stock Investment – When to Enter and Exit the Stock Market


I strongly believe in four data points i.e. P/E ratio, P/B Ratio & Div Yield of Nifty and FII Trading Activity. When i observed stock investment pattern of successful investors, i concluded that they also believe strongly in these four data points. Maybe i am wrong but it seems to be correct most of the times. I am trying to find out more data points and will share in future. As a thumb rule, you should enter and exit based on following 4 data points and stock selection is next critical step. Once you decided to enter the market then you should shop for good stocks available at that time.


1. P/E Ratio of NIFTY: P/E ratio for stock investment is the ratio of Market Value to Earning Per Share. If the P/E is high that means the stock is trading at higher valuation compared to earning. If P/E is 24 then it means as an investor, i am willing to pay Rs 24 for every 1 Rs earning of the company. In short, it is a premium over earning of the company. I found a very strong correlation between P/E ratio of Nifty with market movement. When the P/E of Nifty cross 24 then probability of downtrend is very high i.e. valuations are very rich. On the other hand, when P/E of Nifty is below 16 then there is a strong possibility of upward movement. Historical data is proof of same. In 2008, the market was trading at P/E of more than 24 (Around 27) and it tumbled. Whereas in Aug 2013 the market slipped below P/E of 16 and there was a reversal in fortunes. For stock investment, my observation on Nifty P/E is as follows:


Greater than 24: SELL & EXIT


Between 20 to 24: Be Cautious and market may turn edgy/volatile


Between 16 to 20: Buy Cautiously in selective stocks


Between 12 to 16: Accumulate


Less than 12: I will sell my house to invest in the Stock Market


Less than 12 P/E is highly unlikely scenario:). As soon as P/E touches 24, the probability of negative returns is very HIGH. By the way, when the market started a downward trend in March’15 then the NIFTY was trading at P/E of 24. Therefore successful investors QUIT the market. Now they are waiting for P/E of 16 to enter. Currently, the NIFTY is trading at P/E of 20. Between P/E of 16 to 20 there will be buying opportunity but trade very cautiously. I am also waiting for the same opportunity and keeping a close eye on the market.


2. P/B Ratio of NIFTY: For stock investment, P/B ratio is another critical factor. In layman terms, Book value of the company is total asset value of the company. In other words, according to the company what is the actual/real value of the company/stock. For example, as a company, my book value is Rs 100 but the stock is trading at Rs 200. Therefore, P/B ratio is 2. In short, the stock is overpriced. According to the principle of value investment, you should invest in a stock when P/B is 0.8 i.e. stock is under priced. Practically, it is not possible at the index level. Current P/B of Nifty is 2.98. Let’s check from index perspective.


Greater than 4.5: SELL & EXIT


Between 3.5 to 4.5: Be Cautious and market may turn edgy/volatile


Between 2.75 to 3.5: Buy Cautiously in selective stocks


Between 2 to 2.75: Accumulate


Less than 2: I will sell my house to invest in the Stock Market


3. Dividend Yield of NIFTY: In my opinion, it is least important among all three ratios for stock investment. The reason being dividend is declared by only Cash Rich companies. The dividend yield is basically Annual Dividend Per Share divided by Share Price. If the stock price is Rs 100 and annual dividend is Rs 2 then Dividend yield is 2%.


Less than 1%: SELL & EXIT


Between 1% to 2%: Be Cautious and market may turn edgy/volatile


Between 2% to 3%: Buy Cautiously in selective stocks


Between 3% to 4%: Accumulate


Above 4%: I will sell my house to invest in the Stock Market


4. FII’s Trading: I think, i discussed this point in most of the posts on the stock market. As a thumb rule, you should enter when FII’s are buying and exit when they start selling. The typical example is FII buying from Aug’13 till Mar’15. The stock market was on fire during this period. When FII’s started selling, the markets turned volatile. Now we are in panic selling phase. The last one is a blood bath. Hope that stage will never come.


Words of Wisdom: The points shared in this post are only broader indicators. It does not guarantee positive returns from stock investment. The individual stock selection is second crucial stage after you decide to enter the market. As i mentioned, any investment decision should not be based on handful criterion. The macroeconomic indicators and drivers of the economy should support your decision. Nothing is impossible in this world and i might be in a situation when i can actually think of selling of my house for stock investment. I wish that day will never come because to reach that point, the market has to shatter the complete faith of retail investors in the equity market.


 


 


 


Stock Price Movement - Can You Predict Whether the Share will go UP or DOWN | HINDI 


 


******** 7 Points for Stock Market that Stock Price will go or down ********


1. Price, Volume, Delivery Percentage Increasing togather (Should be Greater than 60)


2. Fundamental Analysis - PE, Divident, Book Value, Balance Sheet, Income Statement


3. Volume Breakout - Stock is Jumping in Huge Volume.. - Popular website par data mil jayega


4. SMA/EMA - should be Greater than 200 (for short term 30 and 50)


5. Future and Options ka Data - Stock me sentiment kya hai?


6. Candelstick Pattern - It will help to know the Trend [Look for reliable pattern, baware of fake pattern]


7. Human Intelligence should be very importen for analysis of Stock


 


 


 


 


Risk-Free Equity Investments:


 


Now you must be wondering how the equity investments can be risk-free. Based on my personal experience I can say it is possible. I discussed it in detail in my post, Stock Investment – When to enter and exit the stock market. I enter the market when P/E is less than 20, P/B is less than 3.5 and when the FII’s turn net buyers. By following this strategy you might be out of market half the times but during another half, you can generate at least 25% return. When the market is in a bear phase, you can put money in liquid funds to generate around 8% annual return. Therefore, the net yearly return can be around 14% to 15%.


 


In this case, the timing of investment portfolio is important. You exit when the market overheats (FII’s turn net sellers, P/E>24 & P/B>4.5) and enter when the market cools down. The key is FII should be net buyers. For FII buying in specific stocks, you can check my post, How to find out FII buying in stocks?