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Lakshmisudha R replied to the topic What is Dow Theory? in the forum Dow Theory in Practice 8 years, 8 months ago
Charles Dow of 19th is the father of Dow Theory.
This theory gave significance to nature of demand and supply while studying about a market
According to this theory study of market is important rather than company
This theory emphasized to go along the market trend by spotting the tops and bottoms in daily charts based on Volume
Dow theor…[Read more]
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Lakshmisudha R replied to the topic Why do people avoid penny stocks? in the forum Understanding the Price Movement 8 years, 8 months ago
People avoid penny stocks because the risk is high almost 100%.
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Lakshmisudha R replied to the topic What is the average turnover in NSE only daily basis? Can any one manipulate the stock price? in the forum Understanding the Price Movement 8 years, 8 months ago
Average turnover in NSE only daily basis is over crores.
Nobody can manipulate the stock price.
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Lakshmisudha R replied to the topic What is the input (Data required) to do fundamental / technical analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Data required to do
fundamental analysis is Quantitative(profit,assets, loans) and Qualitative(policies,employee satisfaction level) data of a company
technical analysis is demand and supply which is price movement and volume traded.
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Lakshmisudha R replied to the topic What are the pro / cons of technical analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Pros:
It is based on market demand and supply information which is quite easy to collect
It does not require detailed analysis of any company for forecasting price movements ; just the demand and supply will do
Cons:
Accuracy of technical analysis when compared to fundamental analysis is less.
Can be applicable for short term investing
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Lakshmisudha R replied to the topic what are the Pro and cons of fundamental analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Pros
Result of fundamental analysis are 99.9% accurate
Decisions made on fundamental analysis are profitable
Cons:
It requires huge volume of data which is practically not possible by the retail investors to collect.
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Lakshmisudha R replied to the topic Why do we need to do an analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Analysis is expecting price movement of a share. Analysis is necessary since it is the source for profit in share trading.
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Lakshmisudha R replied to the topic What drives the stock price? Why to price changes so often? in the forum Understanding the Price Movement 8 years, 8 months ago
Demand and Supply drives the stock price.
Market is being traded by so many people across the globe that is the reason price changes too often and keep on fluctuating. Even Political and International Investment and Natural Disasters are other major elements contributing for Price change.
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Lakshmisudha R replied to the topic What is technical analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Analysis done based on the fundamental analysis is technical analysis.
In technical analysis demand and supply are key elements for forecasting the price movements.
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Lakshmisudha R replied to the topic What is technical analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Analysis done based on the fundamental analysis is technical analysis.
In technical analysis demand and supply are key elements.
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Lakshmisudha R replied to the topic What is fundamental analysis? in the forum Understanding the Price Movement 8 years, 8 months ago
Fundamental analysis is analysising the future of the company by gathering huge volume of quantitative and qualitative data .
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Lakshmisudha R replied to the topic What are different types of charts? in the forum Understanding the Price Movement 8 years, 8 months ago
Line charts, Bar charts and Candel sticks are different types of charts.
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Lakshmisudha R replied to the topic What are Margin / MTM / Premium / Strike Price / Expiry Date / lot size? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Margin – Refundable amount paid by both buyer and seller to the exchange while entering into future contract
MTM – Mark to Market – In case of future contract the buyer and seller are settled on daily basis i.e., they are kept upto the market price
Premium – amount paid by the buyer to seller in case of options for buying shares
Strike Price -…[Read more]
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Lakshmisudha R replied to the topic How option contract differ from future contract? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Future Contract –
Both buyer and seller has the rights in the contract, they both have the obligation to honor the contract
Both are settled on daily basis based on price movements
Option Contract –
Buyer has the right not to oblige the contract
Buyer has the right to sell the contract
Sellers rights are limited to fixing the…[Read more]
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Lakshmisudha R replied to the topic Why should a trader need the futures/call/put? in the forum Essentials of Trading Instruments 8 years, 8 months ago
equity market needs 100% capital where as in derivatives market the capital requirement is less.
Profits can be realized on day to day basis
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Lakshmisudha R replied to the topic What is the Pro / Cons of Equity market from traders’ perspective? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Pros – Settlement of trade is in the end of the day.
Cons – 100% investment is necessary.
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Lakshmisudha R replied to the topic What is the role of exchange in derivative instruments? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Exchange facilitates smooth trading of derivative instruments by
collecting margin amount from both buyers and sellers
Settling the price difference in the contract (MTM) on day to day basis to buyers and sellers
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Lakshmisudha R replied to the topic What is call option and PUT option? Who decide the premium? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Call option – Buyer gets the rights from the seller to buy at the strike price without any obligation to execute the contract <span style=”line-height: 1.5;”>on agreed premium to seller</span>
Put Option – Buyer gets the rights from the seller to sell without any obligation to execute the contract on agreed premium to seller
In both the options…[Read more]
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Lakshmisudha R replied to the topic What are derivative instruments? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Futures and Options are derivative instruments.
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Lakshmisudha R replied to the topic What is Spot / Cash market? in the forum Essentials of Trading Instruments 8 years, 8 months ago
Spot or Cash Market is equity market where the equity shares of listed companies are traded. buying and selling of shares for cash on same day.
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