Category: Random

There are some basic tips while trading the equities.

1. Of course you are doing this to earn profit, but like profit, loss is also an aspect of trading. Have courage to accept the little losses so as to capitalize on the opportunity cost.
2. Patience are always rewarded in share market. So don’t rush to sell a non moving value stock of course unless you need the money immediately or you have spotted a growth stock.
3. Opportunity cost – This one is actually from economics or management, it is the loss of other alternatives when one alternative is chosen. Choosing a stock is bit of difficult and after choosing one, if it fails to move and the left alternative starts to move, don’t switch your investment just for that reason. Else you will lose both momentum buses. Have patience. (This one behavior will discipline your decision making memory muscle which will also help you in your life)
4. Don’t trade based on the SMS blindly, even if it is from your broker. And absolutely do not act on unknown tips. In any case Always check the graph of such stocks.
5. Don’t chase frenzy momentum, else you will end up buying at high price and suffer loss. Don’t be sad if you miss one bus, there are plenty more look for them. You must check why that stock is running and invest accordingly.
6. There is something called as support and resistance to a stock, that is a falling stock don’t fall below certain levels. Even if it comes down to such levels it bounces back to some upper level where it faces resistance. You need to check if a stock is stuck in this range. Identifying these patters is part of technical analysis and we are going to see this in next article.
   Eg. Asian Paints, Idea these are stuck stocks. Asian paints have upper resistance at 1200 and support at 1100. Same for idea, Resistance at 110-115 levels and support at 75. Wait for breakout, check 200 days moving average. (as of 10/01/2018)
7. DON’T invest in such range bound stock without a confirm big news such as merger or big contract award.
8. Historically The market has some seasonal favorite sectors, and times of Buy
   such as Agriculture and allied activities, railways related stocks during budget, strong buying of a growth stock before quarterly results, seed stocks during monsoon – you get the idea its about what will be sold the most.
   Also, In India some sectors are evergreen due to their demands – sectors like consumer goods, FMCG, Housing and NBFC. The 1.2 Billion Indians are going to consume no matter what share market says. So You can buy such good stocks. But you will have to be patient! as these sectors have already rallied a lot.
9. Bonus, Buyback, Dividend and splits
   The stocks that announces bonus share, Share buyback, dividend, and split usually rally. keep checking this link
   http://www.moneycontrol.com/stocks/marketinfo/bonus/index.php
   Bonus share: means the company gives some shares free to its investors. Recently mahindra and mahindra issued 1:1 Share. This reduces share price and thus increases liquidity.
   Share buy back : Its when a company buys back the issued shares, this reduces share supply as a result the investors get better price to their shares.
   Stock Split : usually The stocks are issued on face value 10 and then whatever extra price the final stock gets is called as premium. In stock split they dilute the stock price to increase liquidity.
   Dividend : When company shares its profit and reward the investors.
   
   In all of above cases the stock moves upwards. If you buy sooner you will most certainly get some profit. Never miss the The bonus shares of good stock, they are worth investing it. Dividend, not so much because soon after issuing dividend the share fall by some level.
10. Averaging – If you believe that you have purchased some value or growth stock and it is making some loss, then you need to buy more stocks into your holding. This averages your buy price. Many people fail to do this and suffer huge loss or wait too long.
    Eg. Before the big pharma sector fall, Sun pharma was trading at about 700 level, and then it fell to 470, not in one day but over few trading days. If someone had that  stock at 700 level and added more 10 or 20 stocks at 470 then the average price would have become = (7000 + 9400)/30 = 546. Sun pharma after 3-4 months bounced back upto 595, thus this person would have made profit. You will learn these judgement by experience. This often works for quality stocks.
11. When you trade, the market experts talk about support levels. You need to keep an eye on these levels. I am talking about the Nifty supports. Eg. Currently the market is at 10600+ for this support is at 10550. Also, the budget is scheduled for February 2018 and till then nifty target is 10700. These targets are determined by the technical analysts. You dont need to do that analysis the CNBC TV18 experts will let you know.
12. In earlier article, I talked about buying a stock on correction. But some growth stocks never stop to correct. They just run and run. There is inherent risk in entering such stocks. There are always outliers stocks and trends and you just need to be cautious. Eg. HEG, Asian Granito etc. The only valid tip is If you already owns such stock, if they are value plus growth stocks, then add them more.
13. There is something called as futures. Its the real money making thing. You will hear about nifty future and future of some stock. Futures are about speculating the future price of a stock or value of NIFTY index itself. By knowing the futures you can know where your holding stock can go. Notice, future prices are not real future but just a speculation. This is not a compulsory info. if you don’t understand this or know it, its all right. Just spend some time in morning at 8.30 or in noon at around 2.30 to check market pulse on CNBC TV18.
14. Finally, Don’t forget to book profit when your targets are met. Don’t be greedy. You can repurchase a stock. But have some vision in trading. Planning is essential in finance market.

You will learn more as you will trade with support of some technical some fundamental analysis and some tips from trade experts. I know that in short duration I gave too many terms and stuff, but as you will start facing the market you will get use to them. Share market gives a vantage point about economy. I wish more and more people enter into the market and understand the real nature and spirit of capitalism.

They need to know what really brings food on their table, something much much relevant to daily life. Instead on talking about mundane and rhetoric discussions on religion and past, The youth need to develop this outlook to look at the glorious future that India can have if we let our economy grow properly. We all are going to benefit from this prosperity.

Another idea is to give an perspective about economic thinking and rationality, something beyond the usual emotional thinking that we are accomplished to. Be money wise and adopt economic thinking in your daily life, this will transform your aptitude towards life and you will make better decisions.

Share this series of article if you find it useful, If you know better source than this information, please share that here too. If you are still skeptical about trading and/or don’t have times to trade, don’t feel disappointed. you can still benefit from the share market. You can invest via mutual funds. The next series of article will be on Mutual funds. I will upload it soon.

Here is a summary of your Journey to trading,

1. Basics of Shares,
2. Equity Related terminologies
3. Some technical stuff that you must know
4. Some cautions and introduction to trading platform
5. Some does and don’t of trading. You are here.

Thank you.

Will mothers day a week a month or a year will be enough to express what she means for us?
and moreover, the person for whom such event might be held, do they really want it? Honestly i dont think so. The whole idea that there is need of a separate day to show ‘yes you exist mom n i love you’ is hollow. The same applies to valentines day and all other days that tries to capture something that should be expressed in subtle daily routine lives may be even without words and through gestures of emotions.

And What that can be? May be a listening ear even when she is giving redundant instructions. Accepting her love even when it makes you momma’s boy, without being embarrassed about it. praising her food preparation no matter how it is. (Besides mostly it is the best) spending some time from our busy life to talk with her n not let her feel lonley. Taking her side once a while when she is complaining and even when she is being unreasonable. And most of all accepting her as she is without complain… because thats what she did for and with us. And there is much more to it.

And thats about unconditional love. It never demands, it only gives… it gives to see growth of beloved person and be part of it. But Do we give her that space?

We love our mother because what she did for us was a tough job. We cannot even think about getting into those shoes – its just exhausting. But she does it – even today with a content smile on her face. The love that she shows doesn’t change even today.
But what about us? Are we the same?

Sure one can give a day in calendar to celebrate this all. But without that emotional acknowledgement such selfies and words will be hollow. Mere pictures n stuff i.e. material rewards can never mean what we truly mean to our mothers. But sure every day awareness while dealing with her can make that change. That can be a powerful language and expression to express gratitude in spirit, even if ‘happy mothers day’ those letters are missing.

We need a symbolic day n way to tell our feelings to our mothers. But thats what mom tried to do for us every single day. Only her ways of care are more different and many of them makes us feel “embarrassing” in social life. How had it is to keep aside our ego and just make her feel accepted? Its actually not. But then one day act is always an easy way out that can never be equated to her efforts yet we rejoice it and even she does because all that matters for is our happiness. Which is true love.

But why this discussion in first place? Usually A day dedicated like this is to mark some ideas and ideals. But thanks to western commercial culture, they have made these days just another economic activity. And they cannot be blamed. Even the ancient indian culture had these symbols… various festivals that call for buying certain stuff just to accelerate demand and churn economic activities and keep markey going.

The saddening fact of life is no one thinks about the flip side. The cultural hegemony from west and subtle westernization. We dont need to copy, we have better ways of doing things and we must be seen doing them. Sometimes even in the language of silence and care.

First, While the document talks about OTTs and TSP, the document is not clear if TSP includes all wired broadband service providers. In the chapter 2 it does introduces wired connection as way of connecting to the internet but subsequent reference to TSP points toward the wireless and call providing telecoms. If those references of TSP included the wired broadband service providers then the limitation of bandwidth doesn’t make sense. Also, language of the article appears to be slightly in favor of TSPs rather than the public, which is not desirable.

Second, The document also tries to fix this with a simple solution with imposing limitations instead of digging the root of this issue of bandwidth use. Why user hogs the bandwidth, download copyright content? Do they have other cost effective option? The answer is no. the softwares are too expensive for general user and not easily accessible. The Indian universities don’t have ties with software firms so as to provide the essential softwares to students at lower costs. There is no gateway for students to purchase these software since many Indian lacks access to credit cards. As a result they resort to pirated content which then threaten their security. But government is silent about that serious breach of security.

The end users download movies and songs because they are available on demand. The DVDs are like junk, why would a user carry such bulk with him all the times when memory media are available at such cheap costs? The industry needs to innovate for this and come up with better ways in reaching the end users. Netflix was such innovation, which enabled user to see movies on demand.

Apart from this, there is again issue of accessibility. Many towns and even district places still lack multiplex and good cinema halls to enjoy the movies. The movie industry is no at all concern in broadening its reach in that sense and is more interested in metros. If a user don’t have access to these movies offline, then he chooses it online. India don’t have any Netflix like facility, so download it a cheap and easy way out. The same goes for songs, but only with recent OTT apps people are choosing their ways of listening the songs. Isn’t that good for copyright material?

Third, as India is a soft country, the laws are never strictly or not at all implemented. There is no deterrence for it. Neither any attempts are made to make the illegal copyright material legal. (Microsoft is going to offer upgrade to windows 10 legally even if underlying os is illegal, ofcouse the user will be asked to pay for windows 10 but that will be at lower cost. They did same with windows 8 at launch; an Applaudable move.) With no incentive to use copyright material, the user chose easy way out – pirated contents.

Fourth, The OTTs are also causing innovation of loneliness, distance from real people and pushing the youth into virtual identities. There are no measures from govt. to sensitize the youth on this issue. India faces serious shortage of psychiatrists to help the students. Nor govt have chain of volunteers who have access into collages to communicate with students.

This issue of OTT was raised when the big money making TSP saw a huge market in the form of users. And it’s understandable that TRAI picked this issues in that context but government has bigger roles to play towards citizen. Sadly it is not doing enough on the tough fronts of ethics integrity and morality.

Fifth, and government cannot miss out the imbalances that will set as domino effect as the corner stone of Internet i.e. net neutrality is removed.

Eg. if it charges skype like ARCEP of france, and asks that the operator must meet certain obligations as they are in the business of providing electronic communications. Which will lead to charging the skype. Skype will charge the users, users will ask for QoS since they are paying for the service, the TSP on other hand won’t be able to maintain the QoS (as they are failing to do even today due to infrastructure constrains) this will lead to even more clashes. Also, if skype or hangouts like apps are charged, they are sponsored by internet giants like google and Microsoft, which can afford to subsidies their apps. Thus new entry into the internet telephony will be challenging. It will create imbalance on the web for innovations.

Inshort, this way is going to open more conflicts leading to disturbance in internet ecosystem. It is responsibility of the government to ensure certain standards of life. The UN has already accepted internet as fundamental right for general public. Thus, its necessary for the government to secure this right in greater public interest.

on 27th March, 2015 telecom regulatory authority of India came up with a document to collect suggestions and opinion from general public on  Regulatory Framework for Over-the-top (OTT) services. The OTTs are nothing but the apps that we use on daily basis.(link for the document)

The telecom operators i.e. the agents from whom we get out internet are looking to charge these apps as they are using the infrastructure but are not paying. Just like Google is making a lot of money via online advertisement but it is not paying anything to the internet provider who provided them the medium. (the analogy given by Telecom service providers is – In normal life a person may use a government constructed road and pay tax to the government so that they can build more such roads.) but Internet is not like that, since the user who access such OTTs or website, already pays to the internet service provider a subscription fees! yet the operators are turning every stone to make sure they find some way to find a new revenue stream from this mushrooming online apps. and that greedy approach is threatening something very precious related with the internet – the Net Neutrality.

What is net neutrality? (source)
Net neutrality is a principle that says Internet service providers should treat all traffic on their networks equally. That means companies like Comcast Corp or Bharti Airtel in Indian context should not block or slow down access to any website or content on the Web – for instance, to benefit their own services over those of competitors.

TRAI itself acknowledges this in its document.

“Net neutrality (NN) is generally construed to mean that TSPs must treat all internet traffic on an equal basis, no matter its type or origin of content or means used to transmit packets. All points in a network should be able to connect to all other points in the network and service providers should be able to deliver traffic from one point to another seamlessly, without any differentiation on speed, access or price. The principle simply means that all internet traffic should be treated equally.”

why its so important? net neutrality makes sure that internet remains a inclusive and equality based platform. people get to express themselves in most democratic manner. without this neutrality, the Internet service provider can reduce, or even prevent a user from accessing certain content (audio, video) on the internet. Further, it can also lead to breaking the Internet into many streams of Internet, i.e. diving the subscribers base so that few web sites, apps and content will be available at better speed to few people giving them an advantage. In short, with net neutrality gone, it will be a chaos on the web with monopoly and oligarchy of the internet services. The users have much to lose and so the new start ups, which are anyways threatened by giants like Google and facebook.

where it began?

the document says, The move to Long Term Evolution (LTE) technology’s all-IP architecture will further facilitate this delinking of delivery of services from the underlying network. thus the ISP are losing control over the OTTs as in how they using the bandwidth. (isnt that a proof that the entire net architectures are structured with net neutrality as a corner stone!)

there is much to the debate. but my intention is this post is to present what govt. of India is saying in this regard. the Jargon they have introduced to deal with this issue and how it is important for general public to understand it. The terminologies are in order as they have appeared in the document.

The documentary ‘India’s daughter‘ created much uproar in social media particularly on subject that it was an attempt to defame India. This was not the first time that such claim was made. previously i had a discussion on facebook when Aasaram bapu were arrested on rape charges. in both cases and many more cases the issue raised was – how west is trying to defame Indian culture. whether or not such events were an attack on Indian culture, one must accept that such events sure call for introspection, and there is nothing ever wrong in introspection and own improvement. this is my attempt to introspect few aspects of such traditions, cultural norms and our evolution. How we got here from a glorious civilization to today into a globalized world.

Every story builds upon a context – a prologue. without understanding that background, that chronology of events it’s impossible to feel that story. without feeling the story we cannot entirely relate such story. Such context is crucial Especially when we talk about something profound and old as culture. Our culture represents accumulated wisdom of our ancestors and we need to understand events that lead to formation of those traditions and norms. without understanding and feeling the context of that time, when our ancestors adopted certain norms i.e. their context, we cannot understand if those norms are relevant today. we can follow them, but just as a burden from past which is certainly not fruitful to us.

The necessity for our time is to find and understand that ‘relevance’ aspect to our current life so as to focus our energy and find meaning in our life. However, as Culture is deeply related with pride, many oppose change to old traditions or even such discussion. my request is to read this article with an open mind, i am sure that you wont feel offended but at the end you will find some more meaning in creating new ones with own understanding and efforts.

The understanding of culture mainly comes from our society, our parents and our upbringing. since we learn and experience them in our daily life since our childhood we never question them and accept them as they are, which is infarct needed for any child. However with intellectual growth one needs to question and understand the roots of those norms so as to have relevance of those norms to own life. Much can be said about such traditions and norms, but here i want to point out few such aspects beginning with ‘the distances’ and its impact on our lives.

The collective culture of East Asia and Indian subcontinent is based on high power distance (HPD) while the western individualist culture is based on low power distance (LPD). In HPD we respect authority we don’t talk directly, we don’t confront elders, and we don’t challenge the norm. In HPD we don’t behave assertively and accommodate our opinion as per groups’ opinion – we care for stability and acceptability. We don’t even agree to disagree; we keep those things in mind. As personal liberty is limited it hurts creativity and new ideas, but that maintains stability and continuity.

On the other hand, the LPD is about personal liberty, here age doesn’t matter ideas and views matters more. People don’t fear authority they respect authority because they understand need of hierarchy. They openly disagree with their bosses and elder if they are wrong but they discuss their opinion assertively. In case of conflict they even ‘agree to disagree’ and leave the discussion. It supports creativity but the newness threatens stability.

Following these norms, the Indian society has developed these distances in its social relations – the hierarchies in society and thus caste system, patriarchy – status of wife vis-a-vis her husband, student teacher relation father son relation etc. these 2 features dominates many of the social norms. the distances and such norms have created a stable and in a way rigid society which is not really open to change or reluctant in accepting different cultural norms. (ofcourse, today in globalized world things are changing rapidly)

how does it impact our life today – The peculiar thing happening with our generation is our societies are changing faster than ever, thanks to science and technology. The changes are faster than progress of culture as it has been. We are shifting our habits towards more leisure without realizing it.

The ancient Indian collectivist culture is seriously clashing with the western culture based on individualism. The individualism brings with it qualities like rationality, scientific approach, liberty and with that it gives freedom to question the believe system. While our culture emphasizes on family over individual, our values are more irrational, based on norms, restricted freedom (with restrictions one is limited to explore and that gives security to established system)

the clashes begin when We try to accommodate the change in our habits at the speed of ideas as they are germinate in our mind. we see movies and we try to bring that lifestyle, internet is bringing diverse cultures even closer. The young generation has harnessed this adaptability. and this young dynamic generation has adapted this because they were exposed to this ‘change’ culture since their childhood. As a human being we like to explore new things and thus the young ones are good with this new ideas, but also more impatient. this new generation is more flexible than their parents but also less willing to work harder and persist. They get easily bored and change their moods rapidly.

This is much unlike with respect to our parents’ generation which is a status-qua generation, which loves stability, order and have patience to see things getting settle. Their habit for status qua comes from their upbringing – as when they were child they lived a life of scarcity and had to share what limited resources they had with their siblings which one can see by counting their aunts and uncles! such is not case with current young generation, where they belong to a culture of abundance. they get what they want well before even they desire it! so basically, out parents generation knew about their equilibrium, but what about current generation? what they know about where they are going? and why we care for that equilibrium?

culture evolving from need of stability –

Culture itself is a way to find stability in life. The cultural norms brings predictability and familiarity in life. this likeness for predictability comes from evolution. As law of nature every specie loves equilibrium or stability. We seek stability and loves to stay their till the situation becomes extreme. we do this to avoid uncertainty as stability brings familiarity which intern brings certainty and makes us secure which is must for survival, and survival is all that matters in nature. Thus based on this stability and basic understanding about its grammar we were able to use and develop our intelligence.

We end up becoming intelligent species since we were able to overcome the basic duties of gathering food and shelter, we also learned to use tools to get things going. Eventually we got time to explore the world, we started using our brains, that’s how it grew and we end up being human beings of today (the organs used more often tends to develop more or ‘evolve’). Of course while exploring one needs safety of other needs which was accomplished with above mentioned stability (i.e. food and shelter). That means stability and free time to explore is fundamental for thinking differently and grows. But no matter how much we grow we need social support to be happy; Love them, hate them but we can’t live without them!

Human being like most other animal is a social animal and loves to be in company of other people. Even the introverts need people to share their feelings. So to live with harmony and bring certainty in life (as mentioned earlier) few elders came up with spontaneous rules for society. Later those rules became laws and subsequently established norms. To remain in that society it became then ritual to accept those norms which later became identity of certain society – a learned behavior of certain society i.e. culture.

sadly, over a time people forgot why these laws where created to mitigate which uncertainty, and they kept following the norm as culture even when the uncertainty was gone! But since creativity was limited, people knew no other better way to replace existing one and besides it was ancient wisdom and we must respect our elders, who is going to challenge their authority? A dissident was threatened with ostracizing from society. It was against basics of stability instinct so they kept following it even when it was hurting. Such continuity was also in interest of then powerful few in the society who used those norms as a means of dominance.

when norms became problem –

It’s also worth noticing that a problem never appears as package of problem. It first exists as phenomenon, it keeps on happening until one fine day when we notice that phenomenon is hurting us and that there can be/ should be other way out. we then consult others (we need social support) and then with collective experience declare certain phenomenon as problem and look for solution. but still for some people it may not be problem because they don’t experience as we do or they fail to feel what or how we feel about a phenomenon. it’s all about perception and open mind.

As a human being we are supposed to be learned animal, it adds to our intelligence and growth. But history has shown this that many of us exhibits stubbornly unlearning traits. Another crucial surprising trait we show is, we are more ignorant towards the most fundamental things of life and we resist that fundamental thing. (ignoring mother’s advice and realizing its significance later!)

just like We often complain of weak memory but the fact about memory is neurons that fire together wire together – repetition and relating with previous experiences is the key here but we resist repetition and keep crying. Exercise is must for healthy life – we resist it. Infact we don’t even realize the sensation of breathing! The reason we do so is first, affinity for stability (if it’s not broken, it’s no problem) accept the things as they are. That is how we tend to accept the culture without doubting it – as if it’s in our genes.

But creativity is also hidden in these fundamental things we just need to find it.

Quite a lot evolutionary context! it was needed and it will all make sense in 2nd part here.