Ramanathan Chidambaram

Typo error. Actually the above said analysis is for “AXIS BANK”.

Charts moving as per the prediction, lets wait and see, whether our target is met or NOT?

DOW theory – Its a golden theory, but it failed to give information about the characteristic/quality of the trend. Moreover it gives the information about the trend bit later.

Price patterns – It follows the DOW theory and in addition to that, it gives early signals as well. It gives clear information about the trend, quality and characteristic…[Read more]

Identify equivalent Tops

Duration should be minimum 1 month

Volume should be high at second Top or while crossing “Neck Line” (in the bearish trend)

Identify equivalent Bottom.

Duration between them is minimum 1 month.

Volume should be high at second bottom or at least near the breakout neckline (in the upward trend)

Future/call/put – derivative market instruments.

In equity market, there is no way to execute “short position” and more over high capital is required in case of SPOT/Cash/equity market.

Deal is made immediately by paying minimum caution deposit (10%, which is refundable). But the settlement happens on the expiry date.

On daily basis, the exchange will ensure to MTM and pay back the difference amount to buyer or seller, based on the current market price against the strike price.

Share certificates will be exchanged only on the…[Read more]

Role of exchange is to maintain MTM, calculate the difference and do the settlement on the same day itself.

Incase, exchange is not able to find enough money in either buyer/seller account, then it will fine the respective amount and other applicable charges from respective broker’s account.

Future

Call Option

Put option

Margin – caution deposit paid by the trader to the broker, thereby broker has the access to this money during settlement time (in case of derivative market)

MTM – Mark to market. In case of future market, the difference between the strike price and the current market price will be calculated and the settlement happens on the same day…[Read more]

Advantages of equity market:

Deal and settlement happens on the same day.

No need to hold the investment for a long time.

Shares will get exchanged immediately and thereby the ownership as well.

Disadvantages of equity market:

In case, we predict that the stock price will go down further for next few days, in that case, it is not possible…[Read more]

Future – It is an agreement put forth mutually by both buyer and seller. Hence both of them carries equal risk. The difference in amount will be settled down on the same day itself.

Call option – Buyer has the rights to buy, when it crosses the strike rate with no obligations, so his risk is limited to the premium amount paid. Seller carries more…[Read more]

Current market price for a stock is 2000.

If i would like to buy the share, when it goes beyond 2500, then it is “2500 Call option”, where i have rights to buy the share, when it goes beyond 2500.

If i would like to buy the share, when it goes less than 1500, then it is “1500 PUT option”, where i have the rights to buy the share, when it goes…[Read more]

Equity market is the place where the buyers and sellers exchange their shares.

Spot/Cash market – This is our regular equity market, where the deal and settlement happens on the same day itself.

Dow theory generally used to identify the demand and supply and thereby helps to predict the trend.