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Bible Quotes--

I tell you the truth, it is hard for a rich man to enter the kingdom of heaven. Again I tell you, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of heaven. Jesus Christ

29 Aug 2015

MONEY MARKET-SHARE TRADING TIP.


Hi Friends:   The dark secret of the modern stock market.    -    Back to the beginning and the smart looking strategies how to beat the market:  Will they not allow you to make money in the stock market?  The sad answer is, the private investors and their professional helpers are essentially fighting for a positive piece of a negative cake.  The odds are against the investor.  Planning the exit of all positions and selling regularly, in other words becoming a trader, would improve his situation.  Of course, this is not easy, either.  You are still facing the competition of the market maker and his many dirty tricks.  He has the advantage and you and other traders are still trying to eat a negative cake.  To overcome this tough environment a trading method or system is necessary.  Don’t expect to be able to fend off the systematic advantages of others with impulsive decisions.  Moreover, you have to have an edge.  At least some elements must set your trading apart from what others do.  The market constantly adapts itself to the wisdom of the crowd.  A working system has to meander around the various traps of the market and still center around a real imbalance and exploit it.  Traps and imbalances are hidden.  If they were obvious for everyone they wouldn’t exist.


From my experience I practiced a trading method, it is furnished below for your knowledge and followup action.  Select one or two good shares for your trade.  It is not a Day trade or long term investment.  This is hold and sell and  hold and sell method.  In the present market condition, market is always side way movements.  Even a day you experience, share going up at the same time it may go down also.  Therefore selection of share is very important.  I have selected IL&FS Investment Managers Ltd.  It is a debt free company.  Its dividend yield per year is 7.23% for the last 5 years.  Its present price down side is limited.  Suppose if you are not selling the shares and keeping it in your portfolio, you can earn dividend yield of 7.23%.  My trading method is like this.  Purchased price Rs.17.35.  Present rate is Rs.16.40.  Daily trading volume is 2,00,000/- to 3,00,000/-.  Holding 5000 shares.  Daily difference in share price is between 16.40 – 17.20.  At 10 A.M. I watch the counter,if it shows green signal – above +30 ps.  I buy 1000 shares in addition to my holding.  When at 2.30 P.M. – 3 P.M. if the price of share  comes to Rs.17.05, I sell 1000. After that I watch the market for 10 to 20 minutes, then if the price shows decrease signal to 16.90, I sell 5000 my holding.  At 3. O Clock  share price  shows 16.50,  I put my buy  order for 5000 @ 16.40.



 If it is not bought till 3.15 P.M., I cover the position at 16.50.  So your holding is safe with your hand.  This day’s total profit will be 16.75 x 1000 -17.05 x 1000   =  16,750 –17050   = Rs.300/- minus Commission Rs.30  =  Rs.270.   Again  5000x16.90 = 84500 minus  5000x16.50  = 82,500 = + 2000 minus Commission Rs.50/-  =  1950.  Total one day  270 + 1950  = 2220 profit.  No cash paid.  Your holding is safe  with you.  You can daily do business like this.  If suppose your selling price is going  up,  immediately  cover the position.  In my case I am selling the scrip and trading for the last three months.  Share selection is very important. Normally  Institutions or FIS are not interested in small cap shares.  Therefore, You may also find out a trading method.  Hold and sell and Hold and sell method is good for day traders.  Daily speculative trading commission is less @ Rs.0.012%.  But delivery commission is higher ranging from 0.50% to 0.90%.


Good Luck.                                            See you later.

IDIOMS & PHRASES- MEANING.


Hi Friends:  Please go through the idioms and phrases and its meaning and study  it by heart so as to enable you to practice it in your daily life.

A Chip on your Shoulder -  Being angry about something that happened in the past ; a grudge.

A Dime a Dozen – When something is extremely common and simple to acquire.

A Fool and His Money Are Soon Parted – Someone acting foolish can easily lose his or her money through carelessness or trickery.

A Piece of Cake – A task that is simple to complete;  similar to the common phrase “as easy as pie”.

An Arm and a Leg- Something that is extremely expensive; an idiom meaning the price paid was costly, excessively so.

All Greek to Me – When something is incomprehensible due to complexity.

Back to Square One -  To go back to the beginning ; a popular saying that suggests a person has to start over.

Back To the Drawing Board – Similar to the phrase above, it means starting over again from a previously failed attempt.

Barking Up The Wrong Tree – To make a wrong assumption about something.

Beating Around the Bush -  Avoiding the main  point; a common phrase meaning a person is failing to get to the bottom line.

Beating a Dead Horse – Something that is seen as futile; a popular saying used to describe how bringing up older issues that have already been resolved is pointless .

Between a Rock and a Hard Place -  Being faced with two difficult choices; a dilemma.

Break the Ice -  Breaking down a social stiffness or awkwardness.

Burst your Bubble – To ruin someone’s happy moment or mood, usually by telling them disappointing news or information.

Close But No Cigar – Coming close to a successful outcome only to fall short at the end.

Cry over Split Milk – One shouldn’t worry over things that have already happened and that cannot be changed.

Cry Wolf – Lying; a common phrase meaning someone is calling for help when it’s not really needed.

Cup of Joe – A cup of joe is an American nickname for a cup of coffee.

Curiosity killed The Cat – An idiom meaning mind your own business, as too much poking and prodding could lead to harm.

Cut the Mustard – Meeting expectations; used as a way to describe how someone has met the required standards that were set.

Cut To The Chase – To get to the point, leaving out all of the unnecessary details.  Similar to popular sayings such as “beating around the bush”.  (To be continued).


Good Luck.                                     See you later. 

28 Aug 2015

SHARE MARKET- BEST MANAGED COMPANIES.


Hi Friends:  India’s Five Best Managed Companies:  As per the recent survey , listed below are some of the best Indian managed companies. 


TCS  is one of the largest  companies by market share and revenue.  The information technology company has topped for finest management they have executed, to bring their company to a prestigious level.   Natarajan Chandrasekharan, the CEO and MD of the company has been formulating and executing the global strategy of the company since 2002 when he became the head of global sales.  He built a new organization structure of the company while he was a chief operation officer when he joined the concern and it was disclosed in the year 2008.  This organization structure led to the speed growth of the company.  The market, domains and the business units showed drastic growth.  The initiatives, investment abilities and new ideas by Natarajan cherished the company.


HDFC:  The excellent service provided by them has created a strong goodwill about the company.  The Indian based financial service company was incorporated in the year 1994 by Housing Development Finance Corporation Limited.  It was the first company that obtained the “in principle “ authority from Reserve Bank of India.  The skilled professionals and management teams of HDFC have brought them to top 2 level of best managed company.


INFOSYS:  The Company offers technology-enabled business solutions globally for 2000 companies across the globe.  Inclusive range of services are provided by influencing their field and business expertise with  top technology providers.  Infosys establishing the global delivery model (GD led to a drastic rise in offshore outsourcing.  The best economic sense with lowest tolerable risk is their step for safe success.  They have been working with the watchdogs to improve the business network.  Mohandas Pai, the former CFO of the company played a vital role in converting Infosys into one of the world’s most prestigious and recognized software services in the company.  He planned the country’s first most fluent  financial policy for the company.  The branding among the investor community and attractive transparency and exposure has brought in effective management.


Bharti Air tel:   The largest mobile telephony and second largest fixed  telephony provider has also been listed in the polls as a best managed company.  The fifth largest telecom operator in the world has 230.8 million subscribers and now it is no wonder how stunning management system they follow.  The network offered is one of the best in the world.  They have created a blind goodwill among the people for their effective  clarity and service for the people.  They maintain a very good relationship with other companies and their clients.  The effective organization structure is a main weapon to help  them to reach to this level.  The service and dedication is all performed with utmost interest by the workers.


ONGC:  Oil and Natural Gas Commission , a state owned  corporation.  The oil and gas company supplies 77 percent of India’s crude oil production and 81 percent of India’s natural gas production.  The government owns embraces  74.14 percent equity stake in this company.  The management is undertaken by the board of directors who for create policy, policies and evaluate the performance every so often.  The supervision , control and guidance are done in a diligent manner.  Investing in these companies are good for capital appreciation.


Good Luck.                                                              See you later.

QUOTES- SWAMI NITHYANANDA.


Hi Friends:  Please read the words of Swami Nithyananda  and enjoy it. 1.  Your enlightenment is more powerful than your ignorance.  2. The force that is running inside you is the same force running the solar system.....the moment you relax from the  “I “ the “Other “ with the truth.   3. One must know one’s own secret.  4.  Creativity is the depth of the honesty you express towards your possibility.  5.  Integrating the mind is the essence of life.  Decide you will always say and do only what you feel is right.  Then, you will come to in the inner and  outer worlds.




6. The Stone of Guilt in the River of the Mind, the block in the flow of intelligence.  7.  The mind is trained from a very young age to think that life moves from one worry to the other or from one pain to another, never feel there is something wrong with what you are seeing, then you should look back in at yourself because what you see outside inside you.  8.  You always see the world, the way you are, not the way world is.  9.  Gratitude is the greatest prayer.  Thank you is the greatest mantra.  10. Surrender is the ultimate technique to merge with existence.





Good Luck.                                                                        See you later. 

27 Aug 2015

MONEY MARKET- SHARE MARKET METHODS.


Hi Friends:  The Secret of  Stock Market:-   Many people are interested in stocks.  Some are traders, some investors and some are both.  People in  THE STOCK MARKET    are  generally optimists,  else they wouldn’t dare to risk their money.  It is fair to say that both, traders and investors, believe in what they are doing and probably both think that they know it better than the other side.  Here are some methods investors are using to put their money at work.   


a.       Look for chart patterns suggesting that a stock has become abnormally cheap and at the same time will likely go up from where it is now.   b.  Be a fundamentalist, analyze and examine every data that comes out of a company, and then buy only cheap at a reasonable price.   c. Make global judgement about the economy and hit the right turning point for a general entry into the MARKET to elegantly avoid analyzing details of pea size.  d. Buy the broader market with index funds, based on the idea that overall  THE STOCK MARKET reflects the ongoing advance in the world and thus stock indices are doing well long term.  e. Delegate the work of making investment decisions to a professional , who, because being a professional, should outsmart the market.


Most investors adhere not only to a single pure form of these strategies.  They rotate between them, they try different flavours of them, they mix things up, they even start an investment with one strategy and close it with another.  Or they started trading and end up with an investment.  Nonetheless, all these behaviours seem to have good arguments.  These rational looking strategies and huge stock price advances picked and presented by the media probably  cause the general belief that investing in Stock Market will make people wealthy.  Anyway both Traders and Investors should follow the current international changes and decide accordingly in positive way.


Thanking you,                                                                  see you later.                                           

QUOTES - POSITIVE THOUGHTS.


Hi FriendsPlease read the following and practice it in your daily life.   1. If you can Dream it, you can do it.  2. Keep calm and think positively.  3. Train your mind to see the good in every situation.  4. Replace every negative thoughts with a positive one.  5. Full form of PAINS is Positive, Attitude In Negative Situations.  6. One small positive thought in the morning can change your whole day.  7. Always end the day with 9 positive thoughts; No matter How hard things were Tomorrow’s Fresh opportunity to make it better.  8. I will no longer allow the negative things in my life to spoil all of the Good things I have, I choose to be happy. 



9. Change your thoughts and you change your world.  10. Let everyday be a dream you can touch.  Let every day be a love you can feel, let everyday be a reason to live, because life is too short to be negative.  11. If you are depressed you are living in the past; If you are anxious you are living in future.  If you are at peace you are living in the present.  12. Your time is limited, so don’t waste it living someone else’s life.  13. We all die.  The goal isn’t to live forever, the goal is to create something that will remember you.  14. No matter how big your house is.  How big your bank account is.  The Grave is still going to be the same size!  Stay humble.  15. Don’t regret knowing the people that come into your life.....  Good people give you Happiness, Bad ones give you experience.  The worst ones give you lessons, and the best ones give you memories.  16.  What people think about you is not important.  What you think about yourself means everything.



Good Luck.                                                                 See you later.  

26 Aug 2015

MONEY MARKET- INFLATION VS DEFLATION.


Hi Friends:  What causes Inflation?   Monetary inflation happens when the amount of money in circulation increases faster than the quantity of goods in circulation.  The government is the only entity who can do this.  In the old days, they would simply print more money.  Today, the government purchases securities from banks, thereby increasing the money supply.  Monetary inflation is often followed by price inflation- the inflation  that most consumers can see and identify.  Obviously, price inflation happens when the price of goods increases.  When there is an increase in money circulation , the value of the rupee goes down.  Subsequently, businesses must increase the price of goods to get the same value from their products.


Deflation:  In general, deflation is when the average price of goods falls.  When the inflation rate falls below zero, indicating negative inflation, we know that there has been deflation.  Remember that the inflation rate is calculated based on the change in the Consumer Price Index or CPI.  What causes Deflation?   There are four situations that cause deflation.  1. A decrease in the supply of money.  Let’s say the only goods available in the world were green apples, and everyone wanted an apple just as much as everyone else.  If we only had Rs.10, then each apple would be worth Re. 1.  But , if our money decreased to Rs.5, then each apple would only be worth Rs. 50.  2. An increase in the supply of goods, in the same situation as above, let’s assume the number of apples went up to 20, but we still only had Rs. 10.  In that case, the value of each apple would again be Rs. 50.  3.  A decrease in the demand for goods .  If everyone already had an apple, then no one would want to use their rupee to buy an apple.  The value of an apple falls.  4. An increase in the demand for money.  When the demand for more money increases, it’s symptomatic of people starting to hoard money.  The value of the apples falls in relation to the rupee.


Inflation vs. Deflation:   It’s possible for the economy to be experiencing inflation and deflation at the same time.  Seldom do the prices of goods and services all increase or decrease simultaneously.  Instead , some prices will go up over a period of time, while other prices go down.  In that case, there can be inflation and deflation happening at the same time.  One of the government remedies for deflation is to put more money into supply by purchasing securities.  Increasing the money supply too quickly can lead to inflation and even hyperinflation, a situation in which inflation happens very rapidly.  Inflation and deflation are  both parts of a properly functioning economy.  They typically happen in cycles and can correct  themselves without any government intervention.  However , in extreme situations, like the Great Depression, the economy does need a helping hand from the Govt. of India and Reserve Bank of India.


Good Luck.                                                                        See you later.  

QUOTES SWAMI SIVANANDA.


Hi Friends:  BRAINY QUOTES :    Please by heart the following quotes and remember every time you work in everywhere.     1. Put your heart, mind and soul into even  in  your smallest acts.  This is the secret of success.  2.   A mountain is composed of tiny grains of earth.  The ocean is made up of tiny drops of water.  Even so, life is but an endless series of little details, actions, speeches, and thoughts.  And the consequences whether good or bad of even the least of them are far-reaching.  3.  Crave for a thing, you will get it.   Renounce the craving, the object will follow you by itself.  4. Do not brood over your past mistakes and failures as this will only fill your mind with grief, regret and depression.  Do not repeat them in the future.  5.  There is something good in all seeming failures.  You are not to see that now.  Time will reveal it.  Be patient.  6.  There is no end of craving.  Hence contentment alone is the best way to happiness.  Therefore, acquire contentment.  7.  The harder the struggle, the more glorious the triumph.  Self-realization demands very great struggle.  8.  If you do not know the laws of right conduct, you cannot form your character. 


9. Forget like a child any injury done by somebody immediately.  Never keep it in the heart.  It kindles hatred.  10.  Today is your own.  Tomorrow perchance may never come.  11. The real spiritual progress of the aspirant is measured by the extent to which he achieves inner tranquility.  12. Meditation is painful in the beginning but it bestows immortal Bliss and supreme joy in the end.  13. Complete peace equally reigns between two mental waves.  14. Thinking of disease constantly will intensify it.  Feel always ‘I am healthily in body and mind’.  15. Do not love leisure.  Waste  not a  minute.  Be bold.  Realize the Truth, here and now.  16. Life is pilgrimage.  The wise man does not rest by the roadside inns.  He marches direct to the illimitable domain of eternal bliss, his ultimate destination.


God Bless You.                                                                   See you later. 

25 Aug 2015

MONEY MARKET- SHARE TIPS.


Hi Friends: Debt Free Companies:   India is experiencing  both high inflation and high interest rates.  High interest rates clearly affect  companies’ operating costs & profit margins.  Companies which remain isolated form effects of high interest rates are  debt free companies.  The companies who manage working capital from debt mainly face the burnt of high interest rates.  Profitability of high debt companies is negatively effected by soaring interest rates.  In such critical times, low debt or debt free companies emerge as clear winners.  In India, interest rates are more unpredictable.  Predicting when rising trend will start again is not easy.  This mainly happens due to wavering inflation.  Better policies are required to keep inflation in control.  In India inflation can stabilizes for few year.  But even with minor changes on political front, inflation cuts deep again.  For investors it is important to keep a note of debt free companies in India.  Keeping track of price valuation of debt free companies is a very good idea.  Timing purchase of stocks of these companies is recommended.  It is essential to study debt levels of company over prolonged period of time.  Only one year study may not be enough. 


Even small increase rates can create big hole on companies’ profits.  A company whose turnover is Rs.34,000 Crore incurs Rs.1,300  Crore of Interest Expense.  This is 3.8% of total cash-in.  In terms of expense requirement , 3.8% is considers as high.  Even marginal increase in  interest expense can effect profitability.  To negate high interest costs, companies avoid  high debts.  In case debt levels cannot be reduced, companies’profit level gets reduced.  This is one adjustments high debt companies needs to make all the time.  But debt free companies are completely free of such hassles.  Companies which are debt free also has more liquid cash to manage current liabilities.  As there are no immediate interest expense, companies liquidity is very good.  This makes day-to-day cash flow management relatively simpler.  Debt free companies are considers low risk companies.  Not only investors but also bankers love such companies.  When need comes and such companies need debt, banks can offer debt at low interest rates.   Debt free companies have high credit rate ratio.  For investors, debt free companies are investment heavens.  Debt free companies are like ‘ financially independent’business.  Such companies has enough cash generating source of their own that they do not depend on debt.  This situation may sound simple, but it take decades for companies to reach this stage.


 It has also been observed in general that debt free companies also share higher dividends with its shareholders.  If company is focusing on long term growth, they may not distribute high dividends.  But big, debt free companies share reasonably high dividends.  Generally debt free companies are good bet for investment.  But all debt free companies are not good.  A scrutiny of business fundamentals is a must before one goes ahead and buy their stocks.  It will be good idea to check companies’  ‘Total Income growth (sales turnover)’.  A company, though it is maintaining zero debt, but if it is not able to increase turnover, it will not be considered good.  To get a more clear idea, compare sales turnover of company with its nearest competitors.  Concept is like this, it’s a good practice to keep debt levels as low as possible.  But this should not be done at cost of ‘business growth’.   Companies which are doing so are either complacent or does not have skillful & dynamic top managers.  A combination of high sales growth and low debt is ideal.  Investors must keep track of such companies.  Also, companies maintaining high profit margins automatically  becomes most preferred by investors.  I list below 7  debt free companies. Please look into it and take decision

DEBT FREE COMPANIES.

Infosys Ltd.(5)                              -      22.72 (PAT Margin)

E clerx  Ser.Ltd. (10)                    -      24.38 (PAT Margin)

CRISIL Ltd.  (1)                            -      20.62 (PAT Margin)

Hexaware Tech.Ltd.(2)                -      12.40(PAT Margin)

Nahar Cap&Fin.Ser.Ltd.(5)          -      210.66(PAT Margin)

R.S.Software(I) Ltd.(5)                 -      17.90(PAT Margin)

IL&FS Inves.Managers Ltd,(2)     -      38.08(PAT Margin)


Good Luck.                                                                           See you later.

QUOTES- FROM SWAMI SUKHABODHANANDA


Hi FriendsYou will enjoy each quotes.  But please read and read till the intents get into your mind and heart.                                                                                                                                                   


 1. When God gives us problems, it is to humble us and not to tumble us. 2.   Pain is a gift from the divine to look into what is happening more deeply.  You should be the master of the mind rather than mind being your master.   3.    You should use the mind rather than let the mind use you.   4.   Mind creates misery by its desires, expectations, anger and jealousy stimulated by unnecessary comparisons.   5.  When one is alert, one can transform poison into medicine.    6.   A noisy and pushy mind leads one to a state of unhappiness.  7.   In a seed , there is an infinite capacity  to grow.  Infinity exists in a finite seed.  A seed planted becomes a tree.  From a tree again there is a fruit, from a fruit there is a seed, from a seed a tree, so in a finite seed there is the infinite capacity to grow.   8.    There is no greater force than awareness.  When one increases awareness, even a poison can turn into a medicine and with no awareness a medicine can become a poison.



9.   There are differences in a relationship.  Do not give too much of importance to them.  Give importance to your love and commitment, to your commonality, like you enjoy the joy rides in an amusement park, even though it appears scary.  It gives you jitters but still you enjoy.  Enjoy your relationship.   10.   Negative emotions poison life.  Like avoiding poisonous food, avoid negative  emotions.  Like how you are very alert when you see a poisonous snake, be very aware and alert of negative emotions.  Let them come, don’t identify with them.  Don’t participate in them.  11.   If you go on comparing, life becomes miserable.  If somebody is better than you, learn from them; enjoy others’success.  No one can have all the good qualities.  Someone will always be better than you at some level.  Do not whip yourself with this comparison.   12.   The Gita encourages us to be calm and serene irrespective of the situations that we face in life.  Only such an individual is closer to enlightenment who remains calm.  The greatest discipline is in keeping our minds calm in spite of external turbulent situations.  This is the core teaching of the Gita.



Good Luck.                                                                 See you later.    

24 Aug 2015

SHARE MARKET- PERFORMING PORTFOLIO


Hi Friends:   Assuming you are a well-informed investor  and would like to decide by yourself to invest in shares, then the following aspects should be kept in mind to build a performing portfolio.  You need to devote time and energy  to track and understand the stock, interms of business, growth and the valuations.  Now a days , information is freely available and you could take help from brokerage reports and then come to your own individual conclusion on the company.  If you intend to make a portfolio, it is necessary to diversify, the age old advice of “Don’t put all your eggs in one basket” holds  good  here, it is better to allocate your amount over a number of stocks.  The number of stocks should be at least five but not more than 20.  Otherwise, it becomes difficult to track the portfolio.  You may decide on an internal discipline as to what should be the maximum percentage of holdings in one stock or in one sector.  This is basically to spread out your risk if there is any company-specific or sector-specific risk, which you have not anticipated.


You could also have allocation into small and mid-caps versus large caps.  Large caps generally (not always) mirror the index movement and the small and mid cap stocks have greater chances of becoming multi-beggars.  If you see the trend over the last 12 months, small and mid caps have outperformed the large caps by a huge margin.  So you buy selected small cap/madcap at least 25%.  Here we need to be extra careful as most of the undervalued good stocks have already appreciated and now it would be more on the performance of the stocks in terms of growth in revenues and profitability, which will determine the prices in the future.  Here you refer the  previous posts in the website, to verify the performance of small cap and mid cap shares.  Couple of decades back, we could buy stocks like  Hindustan Lever or Nestle or Colgate or such blue chips, keep them in the cupboards and forget about them.  After 5 or 10 years, they still continued to be blue chips.  The same does not hold good for most of the stocks today.  “Don’t marry a stock”.  We need to continuously monitor the performance of the stocks we have and take corrective decisions as need be.


Timing is really important for a long-term investor, who accumulates stocks periodically in small quantities.  The value averages out during the period, it is never possible to buy at the lowest price and sell at the highest price.  The endeavour should be to buy a stock with good fundamentals for a future price.  The normal mentality of an investor is to panic if the stock price comes down after buying and then book a loss.  Though it is better to have a stop loss in case of a trading portfolio, for a long term port-folio, your conviction is more important.  If your conviction is right, stay invested.  At the same time, whenever you realize that your decision was wrong it is better to book, your losses immediately and move on.  Most people have a limit on the profit made but no limit on the losses, and tend to wait hoping that the price would recover.  Timings may be considered, especially while selling and when it is closer to 365 days, which will enable you to avoid capital gain tax.


The price per share is not relevant, we have today Re.1 , or Rs.2, and Rs.10 and all such kind of paid-up shares.  It is very important to note this.  A share of  Re.1 paid up trading at 10 is equivalent to  a stock of Rs.10 paid up trading at Rs.100.  Hence, you should not be of the impression than at Rs.5 value stock is better than Rs.10 value stock.  Plus, the price per share would differ with the quality of stock and the future earnings and hence at the same paid up price, it may not be necessary that Rs.50 value stock is cheaper than a Rs.100 value stock.


Knowledge , time, effort and discipline is very  important for investments.  You should generally look at the Earnings per share, (EPS) , Price to earnings(PE), Cash EPS (CEPS) and dividend history among other factors while choosing a stock.  Avoid herd mentality while investing, which means, just because your neighbour made money in an X stock, you should go and buy the same.   Emotions have no role to play in portfolio investments.  Let the brain rule the heart.  Mind you, stocks are  high risk, high-return investment instruments. Last but not the least, invest through a registered broker or sub-broke.  Monitor your contract notes, make payments on time and periodically check your DP holding statements.  Nowadays, most of the brokers have the facility to do all these things online and even on mobile.  So be vigilant and build your portfolio.


Good Night, God Bless You,                                               See you later. 

QUOTES- DR.APJ.ABDUL KALAM


Hi FriendsPlease read and think about the following quotes from Dr. A.P.J.Abdul Kalam.


1.       Problems are common, but attitude makes the difference.  2. Suffering is the essence of success.  3. Learning gives creativity, Creativity leads to thinking, Thinking provides knowledge, Knowledge makes you great.  4. Thinking is the capital, Enterprise is the way, Hard Work is the solution. 5. When learning is purposeful, creativity blossoms.  When creativity blossoms, thinking emanates.  When thinking emanates, knowledge is fully lit.  When knowledge is lit, economy flourishes.  6. Dream is not the thing you see in sleep but is that thing that doesn’t let you sleep.  7. If you fail, never give up, because F.A.I.L. means” first Attempt In Learning”.  End is not the end, in fact E.N.D. means  “Effort Never Dies”.  If you get No as an answer, remember  N.O. means “Next Opportunity”.   So Let’s be positive.


 8. This is my belief: that through difficulties and problems God gives us the opportunity to grow.  So when your hopes and dreams and goals are dashed, search among the wreckage, you may find a golden opportunity hidden in the ruins.  Man needs difficulties in life because they are necessary to enjoy the success.  10. Thinking should become your capital asset, no matter whatever ups and downs you come across in your life.  11. Let  not thy winged days be spent in vain.  When once gone no gold can buy them back again.  12. Once your mind stretches to a new level it never goes back to its original dimension.  13. Failure will never overtake me if my definition to succeed is strong enough.  14. Your children are not your children.  They are the sons and daughters of Life’s longing for itself.  They come through you  but not from you.  You may give them your love but not your thoughts.  For they have their own thoughts..


Good Luck.                                                                       See you later.

23 Aug 2015

MONEY MARKET- BONUS SHARES VS STOCK SPLIT

Hi Friends,  Most viewers seem to have some confusion about whether bonus issue and stock splits are the same or not.  They may appear to be the same especially in the eyes of a person not well-versed in finance.  But they are, in fact, two different things.  I explain it in detail.  Simply put – A bonus is a free additional share.  A stock split is the same share split into two.  Usually companies accumulate it’s earnings in reserve funds instead of paying it to share-holders in form of dividend.  This accumulated reserve fund is then converted into share-capital and allotted to share-holders as bonus shares in proportion to their existing holding.  So share-capital of the company increases with a concomitant decrease in its Reserve profits.  Share-holders get bonus shares in compensation of dividend.  But when a share is split, say, from Rs.10 denomination to  Re.1 denomination, there would neither be an increase in the share capital nor a concomitant decrease in the reserves of the company.  This is because while in a bonus issue a person having one share of Rs.10 face value would get another share of the same face value should the company go for a 1:1 bonus what would happen in a stock split is his one Rs.10 share would now be converted into ten Re 1 shares.


One of the major reasons why companies declare bonus issues is that a higher number of shares improves float and liquidity and thereby traded volumes of the stock.  A lower price also makes the stock seem more affordable to small retail investors, who might otherwise give it a miss at high price levels.  Another aspect of a bonus issue is that it reflects the confidence of the company in its ability to service a larger equity base.  Thus , bonus issues are said to be a good signalling mechanism on the company’s capacity to deliver future benefits to shareholders in terms of increased dividend.  For example, a company has an authorized share capital of Rs.1,00,000, it has issued 10,000 shares with a face value of Rs.10 each.  Thus, its issued share capital is also Rs.1,00,000.  It has an accumulated reserve of Rs.10,00,000.  It decides to issue bonus shares in the ratio of 1:1 or “1 for 1”- that is . 1 bonus share for each share held.  In this case, it transfers Rs.1,00,000 from its reserves to its issued share capital.  Thus, its reserves come down to Rs.9,00,000, and it’s issued share capital increases to Rs.2,00,000 .  Using this new share capital of Rs.1,00,000, the company issues 10000 new shares, each having a face value of Rs.10, and gives a new share – the bonus share – for each share held.


It is like cutting an eight-inch pizza into 12 slices from four slices before.  But if you want to buy the shares of a company which are frightfully expensive, you can now buy them for less.  Except for that , in a stock split, fundamental about the company does not change, the issued share capital remains the same, the revenue remains the same, and the profit remain the same tool.  But, since the number of shares issued increases, the profit per share (or the Earnings Per Share – EPS) decreases by the same factor.  So if EPS is Rs.15 per share for a share having a face value of Rs.10, after a 10:1 stock split, the EPS would come down to Rs.1.5.  But since you would be holding 10 shares now, your share of EPS remains the same: Rs.1.5 – 10 shares = Rs.15, which is as before.  So if the PE  of the stock is 20 in our example, the price would go down from Rs.300 (EPS of  Rs .15* PE 20 = Rs.300 per share) to Rs.30 (EPS of Rs.1.5* PE 20 = Rs.30 per share).  But again , since you would be holding 10 shares now, your actual holding remains the same :Rs.30* 10 shares =Rs.300, which is as before.  So, there is absolutely no change anywhere, except for the number of shares traded.  Stock market interprets a stock split as a statement of confidence by the company – it interprets a split as a signal from the company that it is a confident about its future growth.  Also, a stock split increases the number of shares traded in the market, which increases liquidity.  These factors are considered positive, and therefore the market reacts positively.  After split share price is seen increased in case of good companies.  That means Rs.900 is quoted for Rs.10 share, after split it may go 100 or 110 .  This is also a positive side of split.


Good Luck.                                                                    See you later.