Posts Tagged ‘bull market’

Company Insiders Sold Shares Worth Rs.15K Crores

Company Insiders Sold Shares Worth Rs.15 K Crores

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Company insiders, including top management and promoters, have sold shares in their firms worth about Rs.14,950 crore in the past three months.

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This was most perhaps done to cash in on the steep rise in prices during the recent rally and signaling that the market may be fully valued.

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“Insiders are cashing out some part of their shares.

That shows the market is no longer undervalued,” says Jagannadham Thunuguntla, head of research at SMC Capital Ltd.

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Since the Bombay Stock Exchange’s benchmark hit a low of 8,160 points on 9 March earlier this year,

the 30-stock Sensex, India’s most widely tracked index, has risen 103.81%

as foreign investors injected $15.42 billion (Rs 72,165 crore) into the markets, enticed by the prospect of economic growth.

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While major Western economies are barely emerging from a deep recession,

India’s economic output is expected to expand at least 6%, according to estimates by the Reserve Bank of India (RBI), making it the second fastest growing major economy.

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Insider sales include those by promoters, top management such as chief executive officers and chief financial officers, as well as sales of treasury stock.

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While insider trades are reported to the stock exchanges, only the number of shares is disclosed.

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Often, such sales take place over a period of time.

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SMC Capital has played a role in the compilation of the data.

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Insider transactions also include share purchases.

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On an overall basis, company insiders bought shares worth around Rs 5,194 crore during the same period, or around one-third of the Rs 14,950 crore of shares sold.

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A large part of these have happened in the last six months because people are still sceptical about the sustainability of the recovery.

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“No one has any conviction on how long this bull market will last,” said SMC’s Thunuguntla.

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Indeed, with the pace of economic recovery in the West still under question, a potential debt default by Dubai government-promoted entities rocked global markets last week,

sending the Sensex down 3.3% in just two days of trading.

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Points to Remember while Selling Stocks – Part 2

Hello Friends here we come up with an extension of our previous blog, “Points to Remember while Selling Stocks Part 1”.

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Points to Remember while Selling Stocks

Points to Remember while Selling Stocks

In previous Blog we had touched upon few points related to selling stock tips.

In this blog lets get to know more of valuable points in this regard.:)

Major points when to sell your stocks ( starting from 4th..three already being discussed in Blog 1)

4. Stock is Over Valued:

During bull market, high quality stocks appreciate value.

But more importantly, with so much hype around the stock, they are often set up for a fall.

Therefore, investor may use the strategy of selling them first and buy at lower price.

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5. Need Some Cash-

Certain unexpected circumstances may affect the time when to sell stock.

It is not wrong to sell stock to solve your financial emergency, especially the underperforming one.

However, it is advisable to have some emergency cash funds.

After all, basic investing rules is to start investing if you have enough money.

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6. A Change in Monetary Policy-

The Central Bank, RBI changes monetary policy if it perceives that inflation is heating up.

By raising interest rates, it contracts the money supply and slows down the financial system.

It is generally seen that stocks normally react negatively against the action, and some time markets become more volatile.

If you are not happy with this type of risk then you should move a portion of your portfolio into stocks that will not be as affected with such changes.

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7. A Company Suddenly Cuts Dividends or Lower Income Estimates-

This event should be investigated carefully before making any judgment to sell.

For good reason, the board of directors might want to retain more of their earnings for internal growth, rather than paying them out in dividends.

Sell a company’s stock if the performance is down.

Investors must never sell the stock of a fine company if its price goes either ways significantly – up or down.

Falling earnings margins and slowing earnings must be treated as a warning signal.

Lastly, I would like to say that always do your homework (Research) well while selling a company’s stock; you can use either the top-down approach or the bottom-up approach.

Markets are often full of rumors. You cannot make money in the market by acting on market rumors.

Always listen to the stories, but remember you should do your own research–and do it thoroughly.

Make your buy or sell decision based on your analysis of the company, not on what others tell you to do.

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Note : For More Finance Gyan, Latest Industry, Stock Market, Economy News and Updates, please click here

Bear and Bull – Part 1

Hello Friends here we come up with our another write up on “SMC Gyan Series” 🙂

Have you all ever wondered that what exactly this Bull and Bear Market is ?

 

Bull markets and bear markets...what are they?

Bull markets and bear markets...what are they?

What are they? What do they look like? What’s the origin of this terminologies?

Lets Talk about it

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When we talk about bull and bear stock markets it reminds us that it’s a zoo out there. And, like any zoo, there are quite a few wild species to be found 😉

The first two are the bulls and the bears.

Bull market is when stock prices are climbing strongly and a Bear market is when they’re languishing.

Bear Market

To be more precisely, in finance, a bear market is a market condition that occurs when the prices of shares decline or are about to decline.

Figures may vary, but if prices decrease by 15 to 20% then the market is assumed as a bear market.

In general, a bear market resumes if the government goes into recession and if the inflation rate is high.

Bull Market

A bull market is a condition of a financial market of a group of securities in which prices are rising or are expected to rise.

The term “bull market” is most often used to refer to the stock market, but can be applied to anything that is traded, such as bonds, currencies and commodities.

Bull markets are characterized by optimism, investor confidence and expectations that strong results will continue.

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Myth About Bull and Bear Markets

One common myth is that the terms “bull market” and “bear market” are derived from the way those animals attack a foe, because bears attack by swiping their paws downward and bulls toss their horns upward.

This is a useful mnemonic, but is not the true origin of the terms.

Long ago, “bear skin jobbers” were known for selling bear skins that they did not own; i.e., the bears had not yet been caught.

This was the original source of the term “bear”.

This term eventually was used to describe short sellers, speculators who sold shares that they did not own, bought after a price drop, and then delivered the shares.

Because bull and bear baiting were once popular sports, “bulls” was understood as the opposite of “bears.” I.e., the bulls were those people who bought in the expectation that a stock price would rise, not fall.

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Stay Tuned for more on this where we would touch upon if bull and bear markets are inevitable and what are the basics investors should keep in mind while trading in bear and bull market.

Sweetness Of Sugar – Part 1 :)

Hello Friends here we come up with our another write up on “Commodity Corner Series” 🙂

Sweetness of Sugar

Sweetness of Sugar

We would touch upon aspects like seasonality,cyclic nature and analysis of price trend of Sugar.

The Commodity

Sugar is the most plentiful economic sweetener and India’s second largest agro-processing industry.

There are more than 600 installed sugar mills in the country.

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The Seasonality & Cyclic Nature

The crushing season in the country generally starts from October and reaches its peak in January before March end or April of the next year.

It has been seen that during this period, supply arrives in the market and resultantly prices starts falling.

The cyclic pattern of the sugar industry lasts for 3-5 years.

Currently, the domestic sugar market is entering into a severe shortage phase due to sharp decline in production.

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Analysis Of Price Trend

Tracking short term movements as well as the longer term trends seen in and over the last years, one can analyse and assess its prices.

Since 2006, Sugar has been widely talked displaying a continuous bullish rally both in domestic & international market.

In domestic markets, Sugar prices remained bearish in the most part of the year 2007.

Prices surged by almost 30% in the first half of 2008 & regained its sweetness with supportive factors like lower production estimates and rise in export demand.

From July 2008 sugar prices have been maintaining its bullish trend.

In January, 2009 sugar prices reached record high levels.

With an eye on the rising prices, the Central Government announced measures with aim to control sugar prices.

In the month of May, 2009 world sugar prices have surged to a near-three year high, on the back of speculative buying by
funds betting on supply shortfalls in India and Pakistan.

Since October (the beginning of the 2008-09 sugar season), prices in spot and futures market have witnessed a bull run due to lower production estimates for the season.

Market has already breached the long term bearish trend line and presently trading in an interim bullish trend channel.

Speculators, and especially large traders, have really embraced the long side of the Sugar market.

The commodity has one of the best fundamental pictures right now and it is getting a good deal of solid buying.
The sugar market is overbought but it seems that it still has room to move higher in the longterm bull market than imagined.

It has been one of the better performers of the commodities market.

The price of Sugar has more than tripled in about 3 years.

Though, Sugar seems set to lose some of its sweetness for consumers in the time to come.

Sugar prices recently touched a 28-year high of 25.39 cents per pound on September 30, 2009.

This is likely to climb up going forward, because imports by countries such as China, Russia, Mexico and India are set to rise. These countries are consuming more, but producing less of the commodity.

Sugar futures tended to do well in these years.
An investor could have increased his return variability in these years without sacrificing any of his return.

Stay Tuned for more on Sugar Market in commodity corner 😉

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BULLION TURNING TO BILLION

Gold has always been one of the favorite avenues for investors to put their money during any economic uncertainty. We’re into a new phase of this bull market that’s been going on since 2004. Factors like the credit crisis, ups and downs in the global economy, the response of the governments and the monetary authorities set up a very positive environment for gold, not only in the near term, but many years to come.
On the contrary,jewelry demand, however, has fallen off a cliff—it’s almost non-existing right now and a lot of scrap is coming into the market due to very high prices. This is also one of the reasons for which we had witnessed some range bound moves in gold prices in past few months. (Two dynamics in the gold market were pulling against each other as strong investment demand and very weak jewelry demand.
Gold is up by roughly 250% since 1999 and approx. 25% from Sept. 2008 till date as we’re seeing money coming into the gold sector. I think the gold market is out of crisis mode. It has been recognized as an alternative, as a safe haven hedge. Sentiment among investors, especially individuals, is very positive. It’s mainly high net worth individuals who are buying the stuff up with a long-term view. Over the period of time we have also seen that investors are putting more and more money into gold as an investment. However, this increase in investment has come from tiny levels. Retail investment in gold remains tiny comparative to investments in equity and bond markets. Also, the physical gold market is such a tiny market comparative to equity, bond, currency and derivative markets that even small flows from these massively larger markets can result in outsize moves up in the gold price in future.

Gold has always been one of the favorite avenues for investors to put their money during any economic uncertainty.
Gold Coin

We’re into a new phase of this bull market that’s been going on since 2004. Factors like the credit crisis, ups and downs in the global economy, the response of the governments and the monetary authorities set up a very positive environment for gold, not only in the near term, but many years to come.

On the contrary,jewelry demand, however, has fallen off a cliff—it’s almost non-existing right now and a lot of scrap is coming into the market due to very high prices. This is also one of the reasons for which we had witnessed some range bound moves in gold prices in past few months. (Two dynamics in the gold market were pulling against each other as strong investment demand and very weak jewelry demand.

Gold is up by roughly 250% since 1999 and approx. 25% from Sept. 2008 till date as we’re seeing money coming into the gold sector. I think the gold market is out of crisis mode. It has been recognized as an alternative, as a safe haven hedge. Sentiment among investors, especially individuals, is very positive. It’s mainly high net worth individuals who are buying the stuff up with a long-term view. Over the period of time we have also seen that investors are putting more and more money into gold as an investment.

However, this increase in investment has come from tiny levels. Retail investment in gold remains tiny comparative to investments in equity and bond markets. Also, the physical gold market is such a tiny market comparative to equity, bond, currency and derivative markets that even small flows from these massively larger markets can result in outsize moves up in the gold price in future.

Future Venture to Re-File for IPO Soon :)

future group

Future Venture is likely to approach Sebi again for an initial public offering soon, as the validity of the earlier approval by the market watchdog lapsed this month.

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“We are going for a fresh filing (for IPO) with Sebi,” Future Group Chairman Kishore Biyani told PTI.

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The company, which is a part of diversified Future Group, had received the Securities and Exchanges Board of India (Sebi) approval for IPO on September 4, 2008.

As per regulations, a company has to hit the capital markets within 12 months of receiving the Sebi nod.

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Last year, the company had planned to raise up to Rs 1,000 crore through a public offering of about 374 crore shares so as to fund the group’s expansion plans.

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However this time amount to be raised from the capital market would be less than the previously planned Rs 1000 crore.

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Liquidity crunch and volatility in recent times had forced many companies including Future Venture to either postpone or shelve their plans to mop up funds from the capital market.

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“The planned IPO by Future Venture was actually a by-product of the bull market.”

“After the success of Future Capital IPO last year, the Future group thought of tapping the capital market with another offer, although there was no actual necessity of fund raising,” SMC Capital Equity Head Jagannadham Thunuguntla said.

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The Future Group, which is into various businesses apart from retail, is currently looking at ways to raise funds.

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uture Venture is likely to approach Sebi again for an initial public offering soon, as the validity of the earlier approval by the market watchdog lapsed this month.

🙂

“We are going for a fresh filing (for IPO) with Sebi,” Future Group Chairman Kishore Biyani told PTI.

🙂

The company, which is a part of diversified Future Group, had received the Securities and Exchanges Board of India (Sebi) approval for IPO on September 4, 2008.

As per regulations, a company has to hit the capital markets within 12 months of receiving the Sebi nod.

🙂

Last year, the company had planned to raise up to Rs 1,000 crore through a public offering of about 374 crore shares so as to fund the group’s expansion plans.

🙂

However this time amount to be raised from the capital market would be less than the previously planned Rs 1000 crore.

🙂

Liquidity crunch and volatility in recent times had forced many companies including Future Venture to either postpone or

Know how to make money in shares!!!

Make Money By shares

Everyone wants a piece of the stock market. And why not?

But do you know how shares reward an investor?

If you are a shareholder, there are two ways you can benefit from the profits of a company: capital appreciation or dividend.

Read on to understand how shares reward you. 🙂

Dividends, dividends!

Usually, a company distributes part of the profit it earns as dividend.

Say a company earned a profit of Rs 1 crore (Rs 10 million) in 2004-05.

It keeps half that amount within the company.

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This is used for a variety of purposes — buying more machinery, land or raw materials, building a new factory or setting up a new office. It could even be used to repay loans.

The other half is to be distributed as dividend. 🙂

Assume the company has 10,000 shares.

This would mean half the profit — ie Rs 50 lakh (Rs 5 million) — would be divided by 10,000 shares.

So each share would earn Rs 500. The dividend would then be Rs 500 per share.

🙂

If you own 100 shares of the company, you get a cheque of Rs 50,000 (100 shares x Rs 500) from the company.

🙂


Everyone wants a piece of the stock market. And why not?

But do you know how shares reward an investor?

If you are a shareholder, there are two ways you can benefit from the profits of a company: capital appreciation or dividend.

Read on to understand how shares reward you.

Dividends, dividends!

Usually, a company distributes part of the profit it earns as dividend.

Say a company earned a profit of Rs 1 crore (Rs 10 million) in 2004-05.

It keeps half that amount within the company. This is used for a variety of purposes — buying more machinery, land or raw materials, building a new factory or setting up a new office. It could even be used to repay loans.

The other half is to be distributed as dividend.

Assume the company has 10,000 shares. This would mean half the profit — ie Rs 50 lakh (Rs 5 million) — would be divided by 10,000 shares.

So each share would earn Rs 500. The dividend would then be Rs 500 per share.

If you own 100 shares of the company, you get a cheque of Rs 50,000 (100 shares x Rs 500) from the company.