Nifty Options Strategy for Jan Series

As we are seeing nifty ending almost to the high point of year it’s giving real comfort to the Bulls.


For last couple of days nifty is trying to break it's key resistance level of 5200. I suggest following option strategy for the next Jan series.
Strategy is derived to make use of Market Volatility. I believe in month of Jan we'll see very high volatility.

Options Strategy:
Buy 5100 PE - Current Price Rs. 93.50
Buy 5300 CE - Current Price Rs. 85

Total Money Paid: 8900 Rs.

Ideally you'll start making money nifty above 5350 and nifty below 5150 if nifty crosses the levels within first two weeks.

I'll keep you posted about when to exit this position.

Happy Investing!!

DB Corp IPO Allotment Status

DB Corp IPO allotment status is available now.

Click Here to check your status.

Happy Investing !!

Market Outlook - Next Week : Rally to continue??

We've witnessed excellent rally on the Dalal Street last week. After facing resistance for last 2 months, nifty able to cross 5180 and touched intraday high of 5197.

Bulls have geared up in fashion and trapped bears on last Thursday. Initially bulls built up fresh long position in the market with force due to which nifty climbed to 5070 from 5040 in just two minutes.There were people on the short side. They were shocked by this move but still continue to hold short position. By the time they can think of anything nifty reached to 5100 and they had to cover short position which led market to reach around 5150 levels. On Friday market opened in green following positive global cues. It burst in the last hour and touched 2009 high of 5197, after remaining quite for the day.

Now what next?
There are few reason for me to continue long position in the market and I'm bit optimistic that nifty will move towards 5380 - 5450.

- Christmas rally is underway now and it's likely to continue for while.
- Markets have touched new highs after consolidating for almost 2 months. This could lead markets to add 3-4% rally as traders would become active now.
- Lots of People/Funds/HNI are sitting on cash and market is not giving them chance for entry. This money will come into action once nifty closes above 5200.
- Earning season will set tone for the market in January.
- Fresh allocation for the equity will take place in January for many FII and Funds.
- This Christmas party is likely to continue till mid of January unless there's some brutal correction globally.
- There's ample liquidity in the system which is keep on flooding into the stock market. So even if stocks look pretty expensive at this point but this liquidity could take stocks such high which no one has anticipated.

My Recommendation:
- This up move should take nifty around 5380-5450 levels.
- Traders should hold long position if they've taken it already.
- Fresh long position should be taken only if nifty closes above 5200.
- Investors should hold there position and partially book profit around nifty levels of 5380.

Happy Investing!!

Stock Market Expert - Minting Money

It gives me immense pleasure that lot of people are making money using investment and trading idea which I shared on this blog!!

Below are some of the gains that people would have made for my recommendations.

In coming weeks I'll come up with some more investment and trading idea.

Happy Investing!!

Investment Idea - Cox and Kings

If some one will ask me about investment in the indian stock market, I'll go with only one theme. Invest in the companies which are leaders in their respective sectors or company which is showing excellent growth potential.

Cox and Kings come under both the above categories. Its leader in tours and travels and company is posting excellent results if you check last 5 years track record.

Indian tourism industry accounts for 6% of GDP. So I believe there is immense opportunity for the company to expand. Think from common mans point of view. You can see now lots of people are spending money on trip outside India or within India as well. Industry is growing at really good pace and leader like Cox and kings will definitely get benefit out of it.

Financial:

- Company has posted excellent top line and bottom line numbers for last 5 years. One of the most consistent growth I've seen ever.
- Company was managed to achieve almost 23% CAGR growth for last 5 years.
- Company is looking to grow inorganically as well by several acquisitions.

News and Peers comparison:
Today stock price was quoting at around 430 rs. It's still looks cheap when we compare its peer Thomas Cook.
Also there's going to be news flow in this counter. Company has tie-up with Indian Railway for special tourist train which is going be launch in January. This positive announcement will definitely help the counter to break its highs and move towards 500 Rs.

Mutual Fund:
Most of the mutual fund which are doing good have opted for Cox and Kings. They do so after doing lot of research about the company growth which can reflect in their own growth.

I recommend BUY on Cox and kings at current levels with medium term price target of 510 Rs and 1 year target of 660 Rs.

Happy Investing!!
Disclaimer: I do hold Cox and kings since it's IPO.

Investment Idea - Rural Electrification Corporation

After recent rally people are really skeptical about picking stocks as they've seen really huge correction in stock market once after market was making new highs.

Now people use to ask me which stocks to buy after markets have doubled in last 8 months. They are long term investors and want to invest for 5-10 years.

I recommend REC to all these investors and there's enough reason for me to do so. This is the must buy stock which should be there in ideal portfolio.

REC is a Navratna company having robust revenue and growth. It's operating into landing money for power generation distribution and electrification to the various project across India. As we know there's lot more buzz on power sector and it's likely to be sector of next decade. So what to pick out of these sector? Let's pick the best stock which will turn multibagger for us in next ten years. It's already multibagger for the people who have accumulated the stock on each down turn.

Now there's news flow as well. Government will come up with Follow on Public issue for REC, mostly in Jan-Feb. We've heard lot more about disinvestment and REC will get benefit out of it.

I personally hold REC since IPO - Feb 08 when I got it for 105 Rs. and then stock moved to 60 Rs during pick of downturn. Afterwards it's marching towards new highs only. This price movement is based on fundamentals, robust revenue growth and news flow as well. It has touched all time high of 266 Rs. It has already turned multibagger for lot of people. Now it has corrected almost 12-14% and trading at around 230 Rs.

People who missed recent rally should go and buy stock like REC on every dip which will definitely reward them with good returns in upcoming years.

I think this is the best buy for the person who believes in INDIA GROWTH STORY.

Hope this investment idea would help lot of people. Please post your comment in case you have some query.

Happy Investing!!

Post Market Analysis - Bulls Vs Bear 18 Dec'09

Today it was Bull vs. Bear for indian stock market.

Thought the day nifty was hovering around 5030 mark and also touched intraday high of 5058 due to positive opening of European markets.
In the last one hour market has lost fare bit of ground and slipped below 5000. Nifty future was trading in discount and nifty went to 4972, finally ended at 4987 middle of support zone of 4970-5000.

Reality was the biggest looser today which sold off almost 2.5%.
So, now what’s next?

- Christmas is on the way, so global markets are likely to wait for the outcome and then react afterwards based on spending data.

- Indian markets are likely to remain in trading range with positive bias.

- I believe interest rate hike has already been discounted in the banking stocks. So if there's no major surprise from RBI then we won't fall much.

- Closely watch support zone and in nifty breaches 4960-4970 on closing basis then we are definitely heading towards much lower levels. We'll see lot of unwinding in nifty long position also traders may go for fresh short. So take a call based on nifty closing above 5000 or below 4960.

As its Friday don't worry about market. Just spend some good time with family.

For new investor,
I'll come-up with article about stock market education which should help lot of people.

Happy Investing!!

Market Outlook for 17 Dec'09

As mentioned in my yesterday's post about Market outlook, today nifty bounced back from key support zone of 5000 levels. It has not breached that level at all and then touched intraday high of 5072. Finally nifty closed in the green.

Yesterday, I recommended buying DEC 5100 CE at 69 Rs. Today it went up t0 81.50 Rs. One would have easily made almost 20% return on day one.

I would still suggest carry on with your long position and hold on to 5100 CE if you are already holding the position. You'll see nifty trading above 5100 shortly. Keep stop loss of 4970.

Fresh long positions could be created above 5055.

Now, what's next?

- Today bulls have geared up.
- Nifty future is trading into premium.
- Global markets are supportive. By the time I publish this article US markets - Dow and Nasdaq were up about 43 and 15 respectively. European markets were also trading high.
- Asian market are falling a bit for last couple of days, specially Hang Seng and tomorrow they'll might turn into green as global cues are supportive.

As all the above factors are positive and there’s no major cue for the market to break down, I would still go long on the market till nifty is holding above 4970.

Happy Investing!!

View on Telecom Sector

Telecom Sector is likely to be underperformer for next couple of quarters.

There are some reasons behind this.
As we know most of the telecom operators like, airtel, idea, vodafone , reliance comm are now forced to adopt Pay per second plan
by TRAI. This will impact their margins at least by 20%. Also this sector is facing lot more competition from new players like Aircel, Telenor.

I don't think so these companies are likely to post good results any time soon.

Also if we'll take a look at the history Bharti Airtel is the only stock which is multi-bagger. Apart from that none of the stocks have rewarded investors with good returns.

Idea is still trading just above its IPO price.

Now what the investor should do? As Warren Buffet says buys the stocks which no one is buying due to temporary problem in the sector/company with good fundamentals.

These companies are undergoing with earnings downgrade and lot of negative news. So just wait for the market to digest all these news.
There's likely to be good opportunity after two quarters in this sector.

As we know there's lot more action on the internet platform. New revenue model is likely to come from that segment for the telecom sector.
3G Spectrum distribution is already going on for the companies.

For now wait for all these factors and do your home work before getting into the stock where you see clear visibility of earning.

I would advise to track idea and get into it at the right price.

Hope this will clarify some of your perspective on the telecom sector.

Happy Investing!!

Subscription Details - DB Corp

Qualified institutional buyers - 68.52
Non institutional investors - 26.17
Retail individual investors - 3.42
Total : 39.54

Subscription details are available for DB Corp IPO on NSE web site.

There's lot more buying interest from QIB's where it subscribed 68.52 times.

For retail investor it subscribed 3.42 times. Hopefully all retail investor should get allottment.

Investor who have applied for DB Corp need not to worry about anything. This is the same case as Cox and kings where people have made lots of money on the day of listing.

You'll definitely get good return out of this IPO.

Market Outlook for 16 Dec'09

Today it was turbulence in the market. After opening in the green both the indices - sensex and nifty end in red. Now sensex is below 17000 and nifty is just holding above 5000.

Bank index was down almost 3%.

Now what is next??

All the expected news/triggers have already been priced into the market.
Like,
- IIP data
- Inflation data
- Advance tax collection

So there's no trigger for market to break any of the side. We are still into 5000 - 5180 range.
Also global cues are supportive as U.S. Markets are making new highs.

Now we are near to support zone – lower end of trading zone. Trader should go long in the market. All such deep into the markets are buying opportunity.

For the market strategy I'll advise to buy DEC 5100 CE at around 70 rs.

Keep the long position open till nifty breaches 4960.

Happy Trading !!

Stock Recommendation

Market is in range now so it's time to pickup the stocks which correcting from their highs and have potential to do well in next breakout.

I would go for two such stocks,
1). OBC Bank : Oriental Bank of Commerce
This stock is excellent pick amonst banking sector. Stock has corrected almost 10% in just 2 days and today it's likely to form some base and start moving upwards in next couple of weeks.
I recommend buy for the stock from the short to medium term.
Current Price :- 249.20 Rs
Target Price:- 271-275 Rs.
Stop Loss : 236 Rs.

From the medium to long term target could be 291-305 Rs.
2). IDBI Bank :
It's one the best pick amonst MID-CAP PSU Banks. It's having excellent track record.
Stock has correct almost 9-10% after touching 52 week high as some of the PSU bank stocks have corrected. As per the pattern created by IDBI, it's making higher top and higher bottom.
It's likely to cross it's highs and expected to give 12-15% in near term.
I recommend buy for the stock from short to medium term.
Current Price: 129 Rs.
Target Price : 142-146 Rs.
Stop Loss : 116 Rs.

Medium to long term stock could go upto 155-165 Rs.

Hope this Swing Trading idea will help you in better trading.

I'll come up with some more gems !!

DB Corp IPO - Subscribe?

Recently many companies are raising money using IPO, but only few have left something on table for the investor. Like, Oil India and Cox and kings.

Now it's turn for DB Corp. You must be thinking what's this company is all about , I've never heard about it. But the truth is you already know much about this company. You must have heard about Divya Bhaskar or Dainik Bhaskar. This company is behind all these brands.

Company has come-up with The IPO of 18,175,000 equity shares.
Price band : Rs 185-212 per share
Issue closes: December 15, 2009

For long term investor this IPO looks good also you can make money on the day of listing.
Company is operating in many states and under vernacular media. This space is getting lot of advertising revenue, inspite of the current slow down.

Growth story for the DB Corp is intact and also they've left some money on the table for investor, as company is having P/E multiple of 20 as per forward earning of Rs. 12 for FY11.

I believe stock can go upto 235 - 245, which would be fair value for the company. So here's chance to get 10-15% return. Only concern is the D-Day for the stock, which is listing day.
As per current situation in market there's no positive surprise likely to come in near future.

Also during first-second week of Jan, there's likely to be rate hike. So we just need to keep close eye the listing date.

So people who want to exist the stock on listing day should go for it and definately long term investor should apply for the IPO.

Market Outlook

The sensex and nifty closed in red today. After opening in Green and seeing some positive news on dubai front finally it was inflation numbers which has spoiled the party.
Now, Nifty is facing big hurdle in crossing 5180-5200 levels. It's been in the range for almost two months and still not able to cross all time highs. More of it's like psycological pressure.

Does market look tired? or It's just because there's no supply of paper from FII ?
Well, for now it looks like market is bit tired and it's not having conviction to cross 5180 in near future. In near future it look like we'll be having some selling pressure when nifty touches 5180-5200 range. Lots of call writing is happening at 5200, which suggest it's going to tuff for nifty to cross 5200 in december.

We may see some news on Rate Hike, as inflation is heading upwards. Mainly it's food inflation which needs to be controlled.

Even after all this things and hurdles, I believe nifty will take out this intermediate highs.
Few points related to this argument.
- As we know lot of people are sitting on cash who missed rally.
- Fresh equity allocation would be there from FII and DII. Likely to see lot of money inflows.
- U.S. is stil having rates near to "ZERO", which will keep on adding money into the system.
- Domestic consumption-growth story of india.

For short term we need to be really stock specific while investing in market.

Just wait for my next article, where I'll give you some trading idea for short term to medium term.

Happy Investing !!