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Kannan wrote a new post, Dow Theory HT, HB, LT, LB 7 years, 1 month ago
HT, HB, LT, LB
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Kannan replied to the topic Why do we need to do an analysis? in the forum Understanding the Price Movement 7 years, 1 month ago
Before making investment we need to know about the company, price, volume and what is the likely price movement in the near future as well as long term. For doing this we need to do analysis.
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Kannan replied to the topic What is the input (Data required) to do fundamental / technical analysis? in the forum Understanding the Price Movement 7 years, 1 month ago
Fundamental Analysis: Assets, liability, cash, government policy, geological location, raw material, supply chain, production line, technology etc.
Technical Analysis: Charts, volume, price, indicators, patterns etc.
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Kannan 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 7 years, 1 month ago
Low volume stock prices can be manipulated by strong hands.
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Kannan replied to the topic What is technical analysis? in the forum Understanding the Price Movement 7 years, 1 month ago
Study of the market mainly by using volume and price. There are other things like indicators, pattern etc which complement technical analysis.
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Kannan replied to the topic What drives the stock price? Why to price changes so often? in the forum Understanding the Price Movement 7 years, 1 month ago
Demand and supply drives the stock price. Because of the demand and supply weakness or strong prices change often.
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Kannan replied to the topic what are the Pro and cons of fundamental analysis? in the forum Understanding the Price Movement 7 years, 1 month ago
Pros: It is the best study available to do investment. It takes into account all the factors that affect company’s revenue.
Cons: It involves high cost and manpower and time to do fundamental analysis.
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Kannan replied to the topic Why do people avoid penny stocks? in the forum Understanding the Price Movement 7 years, 1 month ago
As penny stocks are traded in low volume, it is easier for someone to manipulate its price so people tend to avoid penny stocks.
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Kannan replied to the topic What is fundamental analysis? in the forum Understanding the Price Movement 7 years, 1 month ago
Fundamental analysis is the study of the company more factors affecting its revenue. It involves deeper studies which involve high costs and time. This is the best analysis to do investing but due its high cost involvement it is not possible for retail traders to do this type of analysis.
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Kannan replied to the topic What are different types of charts? in the forum Understanding the Price Movement 7 years, 1 month ago
Line Chart.
Bar Chart.
Candlestick chart.
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Kannan replied to the topic What are Margin / MTM / Premium / Strike Price / Expiry Date / lot size? in the forum Essentials of Trading Instruments 7 years, 1 month ago
Margin – Amount required to trade in futures market.
Premium – Money paid by the buyer to the seller in Options market.
Strike Price – Price at which both buyers of options strike deal.
Expiry Date – Expiry date of the futures or options contract.
Lot Size – Number of shares traded in futures or options market.
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Kannan replied to the topic What is Equity market? in the forum Essentials of Trading Instruments 7 years, 1 month ago
Equity market is also called as Cash Market, Spot market.
This where the transfer of shares takes place. All shares have equal value.
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Kannan replied to the topic How option contract differ from future contract? in the forum Essentials of Trading Instruments 7 years, 1 month ago
In future contract there is right to sell or buy with obligation. In the options market there is only right with no obligation in the case of buyers. In case of sellers in options contract there is obligation.
The margin required will be small in options contract.
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Kannan replied to the topic What is call option and PUT option? Who decide the premium? in the forum Essentials of Trading Instruments 7 years, 1 month ago
The exchange stipulates the premium of option based upon different factors such as spot price, expiry, volatility etc.
Call option – Gives the buyer the right with no obligation upon paying a premium to the seller. When prices are likely to go up buying call option will give profit. The maximum risk will be the premium for the buyer. <span st…[Read more]
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Kannan replied to the topic What is the role of exchange in derivative instruments? in the forum Essentials of Trading Instruments 7 years, 1 month ago
Exchange fixes the margin or premium required for stocks based on their average daily movement. By doing this, it controls the risk.
Exchange as the name implies transfers from one person to another the right. Ensures deals take place between highest buy price and lowest sell price of a particular stock.
At the end of the day, it adjusts the c…[Read more]
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Kannan replied to the topic What is the Pro / Cons of Equity market from traders’ perspective? in the forum Essentials of Trading Instruments 7 years, 1 month ago
Pros: Best suited for long term investment. One can expect dividends which usually is more than the normal investment. Daily time required to follow the market is very minimum.
Cons: Requires huge initial investment as one has to pay the full amount to buy stocks. Equity market is not as lucrative as futures and Options market in the shor…[Read more]
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Kannan replied to the topic What are derivative instruments? in the forum Essentials of Trading Instruments 7 years, 1 month ago
The derivatives derive their value from the spot market value.
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Kannan replied to the topic Why should a trader need the futures/call/put? in the forum Essentials of Trading Instruments 7 years, 1 month ago
A trader need future/call/put because the trader can trade in both direction that is buy and sell and sell and buy. Trader can first sell without having any shares and buy it back later when price is low. This gives him the added advantage of making money on down trend unlike cash market.
Cash is settled on a daily basis and adjusted at the e…[Read more]
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Kannan replied to the topic What is Futures contract? in the forum Essentials of Trading Instruments 7 years, 1 month ago
When buyer and seller agree to settlement at a future date it is called future contract.
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Kannan replied to the topic What is Spot / Cash market? in the forum Essentials of Trading Instruments 7 years, 1 month ago
Spot or Cash market is where the actual transfer of stocks takes place. It is where when buying and selling has happened, at the end of the day the actual transfer of the stocks takes place.
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