INTELLECTUAL TRADING

Since 25th July Nifty is trading in very short range between  8570 - 8700 , finally now short term trend is bearish. 1) Renko Charts showing bearish signal      As per Renko chart patterns - targets were placed @ 8542/8509/8537/8244     SL : 8595. 2) Super Trend is giving sell signal 3) MACD & Know The Sure Thing (KST) were in negative divergance.

When a company starts a business, it requires capital. This capital consists of equity (i.e. the owner's contribution) and debt. The capital is required to buy assets such as plants and machinery, office and factory space, and other important assets to start and run a business. These assets generate cash flows and earnings. Since there is no such thing as a free lunch, capital invested also has a cost involved. This includes the cost of equity and cost of debt, which is interest cost. This is weighted in proportion to their share in the total capital structure which is known as weighted average cost of capital or WACC. Now, if you have to gauge company's performance, it makes sense to compare its WACC with the quantum of cash flows or earnings generated by the investment. This is the return on capital employed (ROCE). Now, why it is important to look at ROCE? Imagine a company's WACC is 14%, but earns a return on its capital of only 10%. What does this mean? Compani...

Market Cap:  91,437 Crores                     Current Price: 1439 Target Price: 1850                                   Upside potential: 26 % (9-12 months) Stock P/E: 27.14                                     Book Value: 482 Dividend yield: 0.8 %                              52 Week High/Low:  1457.95 / 482.92 Mahindra and Mahindra Limited is engaged in the manufacture of passenger cars, commercial vehicles, such as vans, lorries and over the road tractors for semi-trailers, and tractors. The Company's Automotive Segment consists of sale of automobiles and spare parts. Its Farm Equipment Segment consists of sale of tractors and spare parts. Its IT Services segment consist...

Nifty Market Cap (Rs bn) 31,526  FF Market Cap (Rs bn) 27,135  The Nifty 50 is well-diversified 50 stock index accurately reflecting overall market conditions. The reward-to-risk ratio of Nifty 50 is higher than other leading indices, making it a more attractive portfolio hence offering similar returns, but at lesser risk. Index is reviewed on a half-yearly basis and a four weeks prior notice is given to market before making changes to the index set. As per the Index Methodology, We have identified the contenders to be included in the index as well as those which are likely to be excluded from index.

Last week , Indian stock markets witnessed buying interest. For the week, both the BSE Sensex and the NSE Nifty were up 2.6%. The Nifty opened on Monday with a gap up of 90 points and added some more gains by days' end. Much of the weekly gains were registered on Monday while the markets traded in range for rest of the days. Now it seems the index could face resistance near the upper edge of the channel as it is moving to and fro those levels just as it did in April and June. So one will have to wait and watch for further trend developments. If the index manages to close below  8508  levels then the index can drift to the levels of  8405-8317

There was a six per cent crash immediately after the referendum but prices have since recovered. Base metal prices are also up. Zinc has risen by roughly 30 per cent since January. A rise in base metal prices may be a sign of some sort of revival in global demand. Stabilising fuel prices after Brexit could also mean that traders don't expect a reduction in global fuel demand.  On the other hand, gold prices are up sharply, by 25 per cent. Gold has outperformed most non-precious metals. Bull runs in the yellow metal are generally tied to fears regarding inflation expectations and currency collapses. Gold prices tend to have an inverse relationship to growth. When GDP growth is up, gold prices are usually down. Gold put on a spurt after the referendum so the fear factor has built up.         The crypto-currency Bitcoin is also up by 25 per cent since January. Trading in Bitcoin has been largely driven by Chinese speculators who are using Bitcoin as a means of c...

GST is the biggest tax reform in decades. Currently indirect tax regime in India has different types of taxes like service, excise, VAT, entertainment, octroi etc. levied by central, state and local authorities. Proposed GST (Goods and Service tax) will subsume different types of indirect taxes and there will be one single tax rates on all transactions. There are 3 main channels through which GST is expected to benefit certain sectors: Lowering of Effective tax rate: Sectors where current tax burden is very high and is expected to come down under GST Benefits to organized players in large unorganized sectors: Organized players are expected to gain market share in the sectors with presence of large unorganized segment. This is because under GST, small unorganized players will not enjoy exemption benefits levelling the playing field between large and small players. Cost savings on logistics and transportation operations: Under GST all different types of state taxes will be eliminat...

Nifty Weekly Performance (June 20, 2016 – June 25, 2016) Indian indices witnessed buying interest. For the week, the BSE Sensex was up 2.83%, while the NSE Nifty was up 2.96%.  The index put up a staggering 240 points during the week despite the Brexit woes. The index has shrugged off the worries and headed higher, rallying consistently all five days of the week.  Not right time to invest for  long-term investors           Nifty is now just above the range resistance of 8,300. Nifty is forming higher tops and lower bottoms since last 3 months. Despite Nifty is forming higher tops the RSI has failed to keep with it on both daily and 75 min charts. As now bulls have upper hand now , but now we can not under-estimate the power of bears either.          Right now, the Nifty is trading at a P/E of 22.5. That is historically a level of low returns or negative returns.  The returns for an investor who enters wh...