Itsmemad stock tips

I've recently started trading online after doing paper-trading for 3 months. Made 8.5% net profit on the virtual trades. Thanks to the bullish market. I know 3 months of paper-trading is not enough, but can't resist the urge to take the plunge. Testing 3-4 Technical Analysis systems simultaneously. Fine-tuning them to suit my style of trading which includes Fundamental Analysis of stocks as well. My motive is to take few small losses and hold on to the bigger gains.

Please do not follow the trades I'm going to share here. Even if you decide to buy or short, I strongly suggest that you research the stocks yourself. Once again, I'm still doing many experiments and I'm ready to lose money. If I make money, that will be great. If I lose, I'll consider it as tuition fee paid to the market. Just like we paid for our colleges.

Positions I take: Please note that I prefer swing positions of few weeks to few months. Sometimes Intraday too. Basically trying to learn all the trades.

Yesterday, I bought SAIL @ 174.10 with a stop-loss of 170 and target of 178 in intraday trade. I squared off @ 178.70. Kool

Today I'm going to buy Chambal Fertilizers if,

The Price should be in between 90-95 with the stop-loss of 82. First Target will be 105. Hopefully it will achieve it soon.

Happy trading.

All the best itsme :thumbs up:

Welcome to the club

Whats your time horizon on Chambal? Are you betting on urea price deregulation proposal for next year or what?

Thank you meetdilip and Parminder bhai.

I would love to keep Chambal for atleast 6-7 months. It pays dividend in may-june.

However, I may have to exit early, as soon as the sell signal is generated in my Software. As I'm entering this stock only on the basis of strong buy signals. When you trade using Technical Analysis (TA), you got to stick by the rules. Less emotions, we live longer.

Update at 6:17 PM

I purchased 1st lot of Chambal @ 92.1; Current Market Price (CMP): 91.15. The signal is in between hold and sell due to the whipsaw that shot the price to 96.35 at one point and then brought it back to 91.15. The market has been in correction mode since last couple of weeks. My only concern is that it doesn't suffer another whipsaw down-wards and hit my stop-loss.

Thankfully I purchased only with the 30% of the capital I intend to spend on chambal. I'll add more in few days if,

1.) The signal remains hold.
2.) If tomorrow's stock price breaches today's high 96.35, I'll certainly add more stocks in couple of days after some correction. That is a good sign that the trend is going to be up.

If the hold signal gets evaporated, I may consider reversing my position and SHORT the stock for intraday.

Chambal almost breached the yesterday's high of 96.35 by today's high of 96.20. The signal still remains hold. Closed at 94.45. So, I'm gonna hold this position and add more later.

Market is in recovery mode this week. The Sensex/Nifty have bonced back. It's time to buy-buy-buy. The signals in the Software are screaming to buy.

Of late some banks have moved quite rapidly. IMO this correction has changed the price structure of many banking shares. Though all may rally in case of rebound, the once which are likely to do the best are Allahabad Bank, Canara Bank, Federal Bank, Uco Bank, City Union Bank and Indusind Bank. These shares have a far better price structure in place than most other banks.

Vijayabank has also done well this week. It closed at 104.90 today. I'm expecting it to pullback a bit by Friday. Would love to buy it at 100-101 levels.

I've Jagran in my portfolio too. Bought it at @ 131 with no Technical Analysis (TA) but looked at its fundamentals. Hence, no target/stop-loss yet. Soon will apply the formulas on the chart to ascertain it.

For people who have purchased FPO of Power Grid, I would suggest to hold it atleast for six months.

Happy trading.

Originally Posted by itsmemad

For people who have purchased FPO of Power Grid, I would suggest to hold it atleast for six months.

Powergrid is also a good option at around 92-93 (it was available at that price band several times during the last two days).

I would suggest a time horrizon of about an year after which the profits become long term profit and the tax liability is least.

Originally Posted by panchabhut

I would suggest a time horrizon of about an year after which the profits become long term profit and the tax liability is least.

Good point. Short term gain tax will be eliminated after one year.

Damn! I missed a chance to triple money in 4 days. One of the Call Options (Strike price of 95) for Vijayabank was trading at Rs. 4 on Monday. I thought I'll buy it at 3.9 and added it to my watchlist. It never came down. Today it opened with a bang at Rs. 13.5. Now, trading at Rs. 12.

Options/Futures trade are high risk with high gain. It will take time to master it.

Just bought TATA Steel at Rs 620.

What hell of a day it has been so far... Booked my first loss with the real money.. Tata Steel's stop loss of 613.35 has been hit. However, I've recovered my loss. I'll explain the details of the strategy I adopted later, maybe tomorrow. I'm still in the buying mode. Will update.

I lost almost 7 points in Tata Steel after the SL was hit. Thankfully I spotted this down-trend at the right time. I reversed (shorted) and doubled my position in Tata Steel at 615.80 in intraday trade. Finally, covered it at 608.50. Hence, made profit of 7.3 + 7.3 (minus brokerage) points. Tata Steel is not yet in the buy zone. Too much volatility. It should be attractive above 626-627.

In another Intraday trade, I shorted DLF and made some profit.

As I said earlier, I expected Vijayabank to pullback on Friday and it did. I bought it at 102.40.

Similarly, I went LONG in Federal Bank and UCO bank @ 452 and 140 after they pulled back. I was waiting for them with these price levels in mind since couple of days.

Next week is crucial. Although the market is showing strength, another dip can't be ruled out. Keeping that in mind I'll be keeping strict stop-losses on all the holdings in my portfolio.

Hindalco is doing well in the steel sector. I think it can be bought at the present levels with stop-loss of 211-212. If the market remains strong in the coming week as was the case last week, trade in Hindalco is totally in favour though. Its a trending trade. Not a swing trade.

The more it stays above the zone I have mentioned, the more likely it is to head towards 230-240 levels. This is not a swing trade, hence time is on our side.

So lets hope it works well. If markets stabilize further and move ahead, then this sector will definitely do well.

Alluminium not steel! I guess its a typo...

Sorry to barge in but I had a quick question... I am holding BHEL and my average cost is 2252 any ideas on BHEL?

Thanks for the correction. I meant metal sector.

Please keep asking.. I would stay away from BHEL as it's showing a downtrend since couple of months with little pull-backs here and there. It's not a great sign especially in a bullish market (except for 2 weeks). I would suggest to keep the stop-loss at 2145 levels atleast for the next week.

If it recovers along with the market, trail the stop-loss up along with the price-levels to book profit, just in case it dips down again...

Did some quick fundamental analysis as well. BHEL's book value was reportedly 325 in March 2010. Hence, the present price levels are still very high. Exit it soon. Buy it when it comes around 1000 and sleep well on it for few years.

sorry I meant from a long term investment perspective like 3-4 years or more..

Yeah, even for 3-4 years, it's not the right price to enter it. Please read the last para which automerged in the previous post. Enter it whenever it comes to 1000-1200 levels and it will surely more than double in 2-3 years.

Why pay more than it's worth it? Especially if you're a long-term investor. Look for good companies which are value-buy. Apply Warren Buffet in your thought-process.

Have you had a look at the orderbook BHEL has? not being able to execute on time is the only worry that bothers me but other then that there is hardly any reason to believe it would ever come down to 1000 kind of levels.. I would be happy to see those levels though and increase my holding in BHEL!

forgot to mention its not a lumpsum investment... I keep adding from time to time so if it does come down a lot I will add more then I normally do.

Alright. I'll do a detailed fundamental on it and get back to you soon.

Fundamental Analysis of BHEL:

1. BHEL is a Rs. 10 face value company.
2. Promoter holding is 67.72 %, FII holding is 14.72% and General public has only 1.63% of shares which is a good thing.
3. Book value of share is Rs. 325.16. Hence, at CMP of Rs. 2212.55, it is trading at nearly 7 times of its book value. Very high price.
4. Considering its performance in last 5 years, the avg. EPS should be 72.87. Hence, current P/E ratio is over 30. It should be ideally between 10-20 for defensive long term investor and maximum 25 for an aggressive/enterprising investor.
5. I still haven't looked at the order book. It's not required. As Parminder bhai has already mentioned about his concern for the delivery target being achieved. Also, one more concern is that nobody knows if the company will get similar orders after 1-2 years. It's important to remove the speculative part from fundamental analysis of a stock.
6. BHEL's stock price was trading near Rs. 3000 in 2007. People were speculating that it may reach Rs. 5000 within a year. However, the stock price fell to Rs. 981 in later part of 2008. Hence, proving that BHEL is not immune from the market movements. I won't be surprised to see it at that level again.

Conclusion: So overall my view is negative on BHEL at present price levels. (5 years) P/E ratio of 30 is very risky.

BHEL will be a value buy below Rs. 1450. So, one can start accumulating it when it falls below that level and may continue to further strengthen the position till Rs. 1800.

If you are looking to be in the same Industry (Engineering - Heavy), then I would recommend something like a TIL to you. With a stop of 660, you can be long in it. It's currently at 698, so you can wait for it to correct a bit or you can invest some right away. That's completely your call.

One more stock which is reasonably fine in this same Industry is Windsor Machines. It is low on volumes. Hence, be careful with it. With a stop of 82, one can be long.

A company which is under process of going on top can give us good return. A top company will have less chance of remaining on top for coming years as their earning potential would diminish. They will have to hedge their profit; so that means less profit.

Also, there is no stock which you can invest and forget for 2-3 years. Hence, if you invest in any of these, keep me updated. We will review them again and again. Even if we take some loss, we will recover everything.

This is my long term portolio :

Suzlon
BHEL
Sail
Gail
Indian Oil Corporation
HDFC Bank
NTPC
SBI
Maruti
L&T
TCS
Reliance Industries
ITC
Gati
Balaji telefilms
Coal India
Power Grid

Above is my long term portfolio and I add every month on a regular basis and add a bit extra if there is a dip... Suzlon and Bhel are the only loss making stocks.

Coal India and Power grid are from the IPO and FPO and I have very little of both but I have started adding coal India as well now... will book profits in power grid at 116+ levels I added to my FPO allotment recently but will not add any more as I am looking to keep the average cost well below 95 and try finding a quick exit.

What is your opinion on Suzlon considering that I dont mind waiting for another 15 years to make big gains out of it... BHEL I know will lead the upcoming rally allowing me to book good profits and reenter at lower levels later..

Forgot to mention that I have listed these stocks in order of size of holding...

Quite impressive set of companies in your portfolio. It's good to have a mixture of top and aspiring to become top companies in the portfolio. L&T is one of the latter. Pehaps it's going to be the next RIL after 10-15 years.

For long term investment, I would not invest in Coal India at present levels. Instead I may take swing trades and exit out of it in the next 6 months-1 year. Just like you plan to do for BHEL.

I'll also stay away from ITC and BALAJI for long term investment. No FA or TA reasons. Maybe psycological. It's just that ITC being associated with tobacco business adds negative factor to its stock value. BALAJI, well I don't like investing in the company whose name is associated with God/Godesses. LOL
Instead, I'll look to accumulate SUNTV stocks on dips.

Suzlon, I'll write a detailed FA on it in another thread. BTW, for swing traders, buy signal has been generated today.

FII's love ITC and cost of capital is next to nothing in developed countries and this is not going ot change in some time to come.. Most FII's have been underweight on India in the past but things are changing now and we have a lot of international exposure now and FII's belive in the India growth story more then ever before... and FMCG is one thing that would kick ass in th time to come..

Try having a look at HUL's book value and see how it compares with BHEL's and ITC and let me know what you think of HUL and at that BV to price ration do you think it is still buy? I have a lot of exposure in stocks like HUL through mutual funds and I believe once we see a major rally in the Indian market these kind of stocks that FIIs believe in will see the most gains.

Originally Posted by Admin

FII's love ITC and cost of capital is next to nothing in developed countries and this is not going ot change in some time to come.. Most FII's have been underweight on India in the past but things are changing now and we have a lot of international exposure now and FII's belive in the India growth story more then ever before... and FMCG is one thing that would kick ass in th time to come..

LOL.. Warren Buffet said something on similar lines in 1987:

I’ll tell you why I like the cigarette business. It costs a penny to make. Sell it for a dollar. It’s addictive. And there’s fantastic brand loyalty.

However, after few years (1994), his views changed:

Investments in tobacco are fraught with questions that relate to societal attitudes and those of the present administration. I would not like to have a significant percentage of my net worth invested in tobacco businesses. The economy of the business may be fine, but that doesn't mean it has a bright future.

Update: I'm out of Chambal @ 87.10. I know I decreased the stop-loss from 82 to 87. There are two reasons. One is that market may fluctuate again, especially after the IB disclosing the news of scams brewing in the market. Second, there was a sell signal today. May ride it again later.

The idea if value investing and all that is for those who want to get rich and buy private jets for themselves... My goals are different and my foremost priority is to preserve my capital and grow it by 18-25% per year for the next 10 years... or 15 may be and I am out of the stock market after that debt markets will mature in India by then and thats where my retirement income is going to come from.

Sure.. You gotta invest according to your comfort level. It's good that you've a plan and reasonable objectives.
What are debt markets?

Have a read through this article that explains what debt mutual funds are : Investing in debt mutual fund schemes offer many advantages - The Economic Times

Alright. I'll read it tonight. I would like to add something to my previous post. People have different strategies in the stock market. We should always be sticking to the winning ones and fine-tune them. However, if the strategies are not giving us expected return on our trades/investments, we should rethink over it.

That being said, banking sector has taken a sharp correction. I've started shorting various banking stocks with some caution. Risk to reward ratio has been strict 1:1. Luckily all the intraday trades have won me some dough. Made Rs. 3277 within last 2 days. :-)

Once the correction will settle down, I'll again become a swing trader and buy all the banking stocks I mentioned in my previous posts. After all Banks are heart of our economy. If market has to avoid the crash like 2008, banking sector will have to rebound.

I have sold all of my SAIL and IOC today and switched to NHPC making it my third heaviest investment... Dont know why I did that but both sail and ioc tanked as soon as I sold them off... bought NHPC minutes before shops shut so got a good deal.. atleast thats what I think.

What do you think of NHPC considering that I have sold off sail and IOC to invest in NHPC? Was it a good decision or a bad one in your opinion?

I have also picked up some HDIL toay which dropped a bit after I got it but its a long play so that doesnt bother me... whats your opinion on it?

I also added some SBI towards the end of the day hoping to sell the extra holding at a profit in a few weeks...

You may check my views on NHPC now. Will post about HDIL later.

Today I shorted Gujarat NRE Coke, Allahabad bank, Vijayabank and Praj Industries. Except Allahabad bank, all made me some money.

Originally Posted by Admin

I have also picked up some HDIL toay which dropped a bit after I got it but its a long play so that doesnt bother me... whats your opinion on it?

I'll have minimum investment in the stocks belonging to the Real Estate sector. They are the first to come down during market correction or crash. Also, Real Estate stocks are the last ones to take off during a rally. Please check the last few years price charts of the Real Estate stocks to confirm it.

Probably I'll stay away from the Real Estate sector. Talking in terms of the share market, there are many other sectors which are more promising. Just don't want to add the overhead of watching the market closely all the time.

For long term investment, portfolio of 4-6 sectors is enough. It's better to concentrate on fewer sectors than having a stock in each sector for an individual investor. Out of these sectors, invest in 10-30 stocks. Diversification of capital is necessary insurance for a defensive investor.

Buy Sterlite Technologies & Bajaj Holdings for 6 months -1 year investment.

Originally Posted by Admin

I also added some SBI towards the end of the day hoping to sell the extra holding at a profit in a few weeks...

Since you're speculating, I did some TA on it.

Just hope that SBI makes a high of 2850 or more today. Then, it comes in the buy zone. We can buy more if it goes to that level. Then, make SL of 2790 for target of 2910-2920 within 1-3 days.

Why I recommend such a short trade?

On the charts, SBI is near a good support base. Therefore, it can be traded for a day or two. Perhaps it is going to take at least 2-3 weeks for this stock and the banking sector to show where the next move is heading.
Generally speaking, I view SBI and the sector fluctuating in a band forming some sort of range, displaying some volatility. Till the range and future movement of sector is not clearly visible, I won't invest my money.

However, short-term trades can be carried out.

Macro-economics of the country and price fluctuations of the last one month suggest that it's time to BUY NOW.

One thing bothering me is the magnitude of scams and the way it may affect Indian promoters and FIIs. Indian promoters may have got little used to the scams. I'm not sure about the FIIs. There is a slight possibility that they may press the panic button first and start taking out their investments.

Regardless of the negative news, I'm still bullish as I was in the last week. Don't want to miss the opportunity to buy some fallen stocks. Hence, I've picked out few scrips which I may buy if the market opens in Green on Monday. Also, these stocks should breach the previous day's high to be fit for buying.

Scrips Stop-Loss
AIAENG 387.25
ESABINDIA 521.30
OFSS 2015.00
MUNDRAPORT 114.00
RELIANCE 958.30
AMBUJACEM 119

I'm going to buy only 25% of the total I intend to spend on each stock. Later will add more as the market strengthens.

Time-Frame:

This is going to be short-term investment (as long as the stop-loss is not being hit). The stop-loss will trail the price movement.

I've sold half of Jagran at 138.50 last week. Tomorrow I may exit it.


INVEST AT YOUR OWN RISK

Could buy only AIAENG and Reliance. First targets are 494.75 and 1101.70 respectively.
Couldn't place the order for the rest as there was some technical glitch in my broker's terminal. Then, I got buzy in some other works.

Exited Jagran. Total profit was 5.5 points + dividend in one month.

According to economic historian Angus Maddison in his book The World Economy: A Millennial Perspective, India had the world’s largest economy from the first to eleventh century, and in the eighteenth century, with a (32.9%) share of world GDP in the first century to (28.9%) in 1000 AD, and in 1700 AD with (24.4%).
Wonder if the stock market was in existence then?

Yesterday I made my first purchase in the OPTIONS. Purchased 100 CA of Vijayabank at Rs. 1.90. Today squared it off at Rs. 2.20 just minutes before the closing bell. Its high was Rs. 2.25.

After reviewing the price structure of RIL, I thought that it will come down a bit from today's open price of Rs. 1072. Hence, purchased 1040 PA @ Rs. 5.10. As of close, the RIL spot price stands at Rs. 1056. And my OPTION's price is Rs. 9.20. Wow!! Will exit it tomorrow asap. I fear that the big players are pulling down the RIL's spot price to scare away the small traders like us. Market is so strong that it should go up.

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Booked profit on Rs. 8.25 for RIL 1040 PA. Now, trying to buy RIL 1080 CA.

Bought RIL 1080 CA @ Rs. 6.10. CMP: Rs. 6.50. Hopefully market and RIL shall end in Green today.

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Looks like someone is big time wrong footed on Reliance. Trying to kill the premium on the options. What an equilibrium in the options for Reliance. I'm holding 1080 CA @ 6.10; CMP is 5.85. Whereas for 1040 PA, CMP is 5.20. Classic! I hope that the Bulls win.

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Bought SBI 2800 CA @ Rs. 30; CMP: 33.35. Keeping the buy order for Vijayabank 100 CA @ Rs. 1.10; CMP: Rs. 1.80.

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Exited all positions in the OPTIONS today. Don't want to leave anything open for the weekend.

Sold SBI CA @ Rs. 32.

This week profit in 3 OPTION trades.

Loss in 1; Reliance 1080 CA sold at 5.

Today profit in TATA STEEL intraday. bought @ 663.70. Sold @ 667.90.

Keeping all the long positions in the equities.

3 points loss in TATA Steel intraday;
Vij 100 CA bought at .90, sold at 1.30
Holding 2800 CA of SBI; bought @ 18.55. CMP Rs. 13.60. I know I'm living dangerously in this trade. Just hoping that the spot price will move towards Rs. 2800 or more till Wednesday. A big gamble.

Good info dude.......thanx

Very nice thread maddy and valuable thread!
nice info

Really nice tips it will be helpful for me surely because i am interested to invest money in share market and want detailed information about it.I just go through Religare online and find some good information there.