As with nature's five elements - namely earth, water, fire, air and sky - we look at five economic and financial aspects based on company's quarterly results to form our valuation. For this reason this technique is called the Pancha Tattva Stock Teknik. Each valuation is given in terms of a delta change from neutral value of 1000 points. Higher the value the better the stock is. 

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Sunday, November 30, 2008

Market Matrix - DoW has lost minimum over the year of turmoil

Friends,

The economic malaise emanated from USA and afflicts USA the most but paradoxically the following figures show that it has been least affected in terms of loss in indices:

Index. Value. 1yr
(241008) Loss

BOVESPA. 33818. 46 pc
(Brazil)
SSEC. 1975. 66 pc
(China)
CAC 40. 3310. 43 pc
(France)
DAX. 4519. 43pc
(Germany)
Hang Sang. 13760. 52 pc
(Hong Kong)
Sensex. 8701. 53 pc
(India)
NIKKEI. 8460. 51 pc
(Japan)
KOSPI. 1049. 49 pc
(S.Korea)
FTSE. 4087. 38 pc
(U K)
DOW. 8691. 38 pc
(USA)

You may have observed that the DoW has lost minimum over the year of turmoil. It may be so that the emerging markets had investments flowing into from USA and this was keeping their indices high and being small markets, the impact of withdrawal of such investment, has been more. The withdrawal was necessitated by the need to have dollars back to USA for the last ditch attempt at saving the day. This way, not only the indices have suffered heavily, these indices have representatives with tremendous value in terms of assets and earning potential. This opportunity will be exploited by some or the other long term investor as soon as the confidence returns. Indian PE at 11.8 (forward PE of 8.7) is very enticing as India is expected to post second best performance in GDP growth at 8.4 pc. China would grow at slightly higher rate. The developed world economies may only grow at sub-2 pc. There will be middle range performance for other countries covered above.

The October end inflation rate was 11.1 pc and 10 year G-sec Yield at 7.8 pc, the real interest is negative therefore. The inflation was at under 2 pc in Jan 2002 and the yield at 8 pc. This is clear that the real rate of interest was at good +5 pc. It may therefore be seen that the industry in not doing to be adversely affected in India in medium to long-term, however, the short term may see irrational moves.

Now the money supply situation in terms of M3 is quite comfortable which is plus 20.3 pc over the year at 43,14,125 crs. The only component that was showing the lower number was deposits with RBI. Term deposits with banks are up 20.8 pc. Clearly people are seeking comfort with bank deposits particularly with PSUs. I am sure this will be corrected and the funds of local people too will be getting back in to equity arena. Sheer values do not keep lying around for long. It is only that some have to show leadership and some companies start their upward march.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx - A prescription for stock market
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BIRDINFO Stock Rx
India
We are India based equity research group and BIRD stands for Business Information Research Dialectics. We have developed a unique system to do analysis of stock markets. The regular recommendations for stocks and industry sectors are available on the site. We also advice our customers for stock market investment based on our Pancha Tattva Analysis System tested for more than a decade. We provide paid advice for one year @ INR 1000 per stock. The advice at the time of volatility and quarterly result announcement by companies is extremely useful for taking Buy or Sell action. You have to make advance payment through our HDFC Bank Account to avail our services. Please send your request via E-mail. The Pancha Tattva analysis (study based on five basic parameters) of a portfolio can also be done on payment basis and investors are requested to contact via E-mail for a formal quote. The content and our recommendations are subject to disclaimer clause posted on this blog site. © Copyright 2006 BIRDINFO Stock Rx All rights reserved. We shall try to provide satisfaction on all our services. E-mail us at krsnakhandelwal@yahoo.com or birdinfo@gmail.com
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Pancha Tattava Stock Teknik - 5 dos & dont's

We give below the important points to remember for the new visitors of our site who venture out to trade/invest on the strength of Pancha Tattva Stock Teknik:

a) The Pancha Tattva (five basic elements described in Indian scriptures) points for a stock are computed at market price and indexed taking 1000 points for value neutral stock. The stock is weaker if it has points under ‘1000′ and is stronger if it has points over ‘1000′. The variation against 1000 level does not always denote the exact proportion in price strength.

b) The points and its resultant attributes are ascribed after careful derivation of certain ratios based on the most recent quarterly results, management strength, industry prospects, political climate, price history, interest rate scene etc. It actually takes care of every aspect effecting the price. This point level along with advice is posted on site after quarterly results for some stocks.

c) The trading/investment strategy given in each case should be followed.

d) Since there are always fresh developments effecting the price, a stop loss mechanism should be followed. You may sell off half the quantity upon slide in price to the extent of 3-5% and sell entire quantity upon 6-10% fall in price.

e) Once out of stock you should not look back at the same stock until fresh point level is given after announcement of next quarterly result. In case some unusual movement is seen in between result period, you should not forget to ask for fresh points level computation and advice. This should be made use of as much as possible.