RBI Monetary Policy- 31-07-2007

RBI monetary policy-
Focus on liquidity
Reserve Bank of India (RBI) delivered the first review of the monetary policy for the FY 2007-08 with a focus on liquidity management and status quo on interest rates.
Surging liquidity and the resultant steep fall in the money market rates prompted the RBI to raise the Cash reserve ratio and remove the cap of Rs 3000 crores imposed on the reserve repo amount under LAF.
The overall monetary policy stance continues to remain unchanged with a focus on price stability, re-emphasis on credit quality and orderly conditions in
financial markets. While the RBI in its policy acknowledged that non food credit growth has moved in the targeted range, the acceleration in money supply and reserve money may warrant an appropriate response.

Monetary measures

• Repo rate and reverse repo rate under the LAF has been kept unchanged at 7.75%
and 6.00% respectively
• The cash reserve ratio (CRR) of scheduled commercial banks (SCBs), is being
increased by 50 basis points to 7.00% with effect from 4th August 2007
• In view of the current macroeconomic and overall monetary and liquidity
conditions, it has been decided to withdraw the ceiling of Rs. 3,000 crores on
daily reverse repo under the LAF with effect from Monday, August 6, 2007


Impact on Debt market

􀀹 The increase in the CRR, will lead to an outflow of approximately Rs 15000
crores from the banking system.
􀀹 RBI’s measures is targeted towards balancing domestic liquidity and prevent a
liquidity related credit boom
􀀹 Yields on long term government bonds may continue to remain supportive on
account of status quo on interest rates and surplus liquidity. The 10-year
benchmark yield may trade in a broad range of 7.50%-8.00% till the next credit
policy review
􀀹 The short end of the curve will correct in view of the removal of the cap on the
reverse repo amount under LAF and the CRR hike. However, strong inflows in
the system on account of government spending and capital flow may cap any
sharp rise in the money market rates. Call rates are likely to stabilize between the
repo and reverse corridor
􀀹 Higher short term rates may encourage arbitrage related flows in the country
which may lead to further appreciation in the rupee.

Conclusion

The Reserve Bank will continue its policy of active management of liquidity through
appropriate use of CRR stipulations and open market operations (OMO) including the
MSS and LAF, thus exploring monetary instruments at its disposal flexibly, as and
when the situation warrants. Expectations of a surprise monetary tightening and
RBI’s bias towards tight liquidity conditions will prevent any kind of immediate
softening in interest rates. On the fund side we maintain our view for investors to
remain on the shorter end of the curve that is liquid fund, liquid plus fund and shortterm fund categories. Investors who have term money for 3 months, 6 months and 1
year can look at Fixed Maturity Plans for stable returns.

Rgds.,
Japan Shah

Ways to invest at High Levels in Market....

As the equity market is touching new highs there are more and more people who are finding themselves interested in the markets. The obvious reason behind this new interest is the amount of returns that other people are getting from the markets and the temptation getting buildup in the mind of others who are not getting the same. This is not a new thing every time the market goes up there are people who come in. They are the ones who become the buyers for those who are already in. These new buyers buy shares at high prices and when they go to sell these shares there is no one to buy these shares, Result? Markest crashes. These new people in such cases get out and book losses. These are the only people who spread a bad word for the market and start saying that the market is a gamble. If you are entering the market like these people please read ahead.
Markets are still very highly valued. So the possibilities of market crash are higher. So if you are planning to invest at these levels study the stock well first. But frankly it is not possible for everyone. so there are two way outs.

1)Intra day trading: Many people think it as a gamble. But it is not so. In case of gamble there is no logic for winning. but in trading there are many logical considerations if you understand at least a few of them you can find out the best stock for that day put your money on it. The best thing for intraday is that you can buy up to 15 times of your actual capacity(depending upon the margin provided by you broker) whereas in case of delivery based you can buy only as much as the funds available with you. So in intraday trading your broker invests more money on your behalf hence you are liable to pay only the loss if the same occurs if your call is correct and you gain, you are not required to pay even a singly paisa on the contrary the market pays you the entire profit. Another best thing about the Intra day trading is that you can sell the shares first and buy them in the evening. This is commonly called as shortselling, which is not allowed for Delivery basis. Again there are some other benefits like less brokerage etc.
Only drawback of intra day trading is that you have to give a lot of time to it and need to have some qualities like general information about current afairs, loss bearing capacity etc.

2)Mutual Funds:The second option is divert your money in the form of Systematic Investment Plan(SIP) to professional fund managers through Mutual Funds. Due to SIP you will get the benefit of falling and will be able to get the advantage of Falling Markets by reducing your average price,
So both the ways are available. Now the choice is yours.

Rgds.,
Japan Shah
japan.shah@aol.in

Do's and Dont's in Intra-Day Trading...

It seemingly looks to be the simplest and the most rewarding. But in intraday trading one has to be very fast and quick and have to be on your toes always, so there are certain rules which one has to keep in mind.
If index is in positive from yesterday and the share you are holding is in minus then it should be cut and if intraday trend of index is in buy then one should buy a stock in which is in plus.

If index is in minus then one should look to short stocks which are minus and not stocks which are in plus.

It is not necessary that a stock which is weak today during intraday trading might be weak tomorrow also, simultaneously if a stock is strong today might not be strong tomorrow.

If US Markets have gone up overnight, the markets here in all probability will open strong, so one should be quite careful when buying stocks as the general psychology of public is to buy when good news is there.

Being a contrarians is very important while trading intraday.
Stop loss is a must while trading intraday.

Always trade in very liquid stocks i.e. which have very high volume because as entry and exit can be very fast in such stocks.

Do paper trading before you actually start trading so that when you start making paper profits, then shift to actual trading.

Keep your volume constant e.g.: if you trade in five lots of nifty future then trade in five lots only. This position can be increased only when you are satisfied with your trading for a month. It should not be that one day you buy five lots and next day you trade in ten lots and third day you get a loss and stop trading for two days.

Fear and Greed are at maximum levels while trading intraday so always have less position when you are new to intraday trading as otherwise you will be mostly under tension.

Rgds.,
Japan Shah
japan.shah@aol.in

Nomura, Japan's firm eyes Indian Equity Business

Japan's biggest broker, Nomura Holdings, may consider acquisitions as a possible route to enter India's booming stockbroking business, an executive said on Tuesday.

Hiromasa Yamazaki, head of Nomura's global equities business, said the firm wants to build a cash equities and derivatives business in India, Asia's third-biggest economy, either from its own resources or through acquisition.

"We want to enter India just simply because of the huge growth potential there. Anything is possible for Nomura," Yamazaki said in an interview.

He said Nomura hopes to double its profit from equity business outside Japan in about five years.

Indian newspapers reported last month that Tokyo-based Nomura may buy a 35 percent stake in unlisted financial services group Enam for 14 billion rupees ($340 million).

Yamazaki declined to comment on those reports, but said Nomura wants to develop its equities operation as well as other businesses in India.

Other foreign players such as Citigroup, Merrill Lynch and BNP Paribas have invested in India's fast-growing brokers as the local stock market booms.

India's main stock index rose 73 percent in 2003, 13 percent in 2004, 42 percent in 2005 and 47 percent last year. So far this year it is up 7.4 percent.

Yamazaki said Nomura Securities is also looking at other Asian emerging markets such as Indonesia and Vietnam to build its equities business and, beyond Asia, to expanding into Russia.

Nomura Holdings and Daiwa Securities Group are trying to expand business beyond their home market to catch up with rivals such as Goldman Sachs and UBS.

Daiwa Securities SMBC, Japan's second-biggest broker, aims to more than double profits from its foreign businesses by 2012 as its parent announced a 100 billion yen ($807 million) Asia investment plan, the brokerage firm's president Shin Yoshidome told Reuters last month.

Yamazaki said Nomura's international equity business -- which excludes investment banking -- contributes around a quarter of the securities firm's profits, which he wants to double in five years to 50 percent. He said the expansion would also see revenue from its international business grow to 50 percent over the next 2-3 years.

Yamazaki said Nomura plans to focus on derivatives, options trading, futures and a specialized business for hedge funds called "synthetic prime brokerage", which helps funds use share swaps to structure trades.

He said the synthetic prime brokerage will be one of the key products for global hedge funds seeking access to the Japanese market and Asia.

Yamazaki said one reason why Japanese brokerage firms are looking beyond their home market is that Japanese investors want to diversify their investment portfolios.

rgds.,
Japan Shah
japan.shah@gmail.com

Four easy steps to buy MF's...

Equity is one of the best investments but it requires fairly large corpus, deep market knowledge and fairly regular monitoring. Mutual funds provide the right opportunity to the millions of investors - who lack money, expertise and/or time - to profit from the equity markets.

Mutual funds are supposed to make life simple! However, the story on the ground is somewhat different.

The number of Asset Management Companies has already crossed 30 and the number is growing. HDFC, Birla, Reliance, Franklin, Principal, Sundaram, LIC, Tata, SBI, UTI, ICICI Pru, Kotak, DSPML, etc. have been around for quite some time now.

But the tribe is growing with new entrants like HSBC, ABN Amro, Fidelity, Quantum, JM Morgan, AIG, etc. joining the party. While this competition is good as it allows better products & services to be offered, it becomes difficult for an ordinary investor to decide where to go.

Then comes the bewildering mix of funds - short term debt funds, long term debt funds, short term floating rate funds, long term floating rate funds, gilt funds, index funds, tax-saving funds, diversified equity funds, growth funds, dividend yield funds, mid-cap funds, sector-specific funds, close-ended/open-ended funds, etc. not to mention specialty funds like derivative funds, gold funds etc.

Many funds have similar names, which makes it difficult to distinguish between them. Many funds have exotic names. Again, all this variety is good, but it leaves a lay-investor totally foxed.

That's not the end of the story. Having chosen an AMC and a particular fund, you are again caught in a quandary, when you sit down to fill-up the form. Should you opt for growth or dividend? If dividend, then whether payout or reinvestment.

Well, here is a simple 4-point formula to help invest at least a large part of your corpus without many hassles.

Step 1:? Analyse yourself
The most basic rule of any investing is that you must invest keeping in mind your financial profile.

Each one of us has a unique financial profile. Accordingly our investment pattern will also be unique. Hence, we must never invest based on where others are investing.

Therefore, as the 1st step you need to design your investment plan taking into account your financial objectives/needs; the time period you can remain invested; and how much risk you can take with your money.

Step 2: Choose the type of fund
Having defined your investment needs, risk appetite and time horizon, decide how much money will go to which type of fund. As mentioned earlier, there are a wide variety of funds. But broadly speaking you can use the following simple strategy :

Short-term money: The money which you may need within 6 months should go to liquid or short-term floating rate funds.

Medium term money: The money which you need within 1-3 years should go to MIPs (which invest about 10-20 per cent?in equity) and balanced funds (which invest about 65-70 per cent?in equity). Or you can buy a suitable mix of 100 per cent?equity funds and fixed maturity plans/debt funds.

Long term money: The money which you don't need for at least 3-5 years should be put in large-cap/diversified/index funds (about 50-60 per cent), mid/small-caps (about 25-35 per cent) and sector funds (10-15 per cent). You can skip sector funds if your risk appetite is not high.

Step 3: Choose the specific funds
Top performers keep changing from year to year. It is impossible for anyone to predict which will be the top performer next year. Having said that, there are funds, which?have consistently delivered above average returns. This is the set of funds, which should be your target.

You have, in step 2, already shortlisted the 'type' of funds you should invest in. Now choose the top 5-7 funds amongst each particular type.

Just make sure that you are suitably diversified across fund houses too, by ensuring that you don't choose too many funds from the same AMC.

Step 4:? Which option is better
The basic returns from the fund will be same irrespective of the option you choose. However, the post-tax returns can be different. To keep things simple, just remember three things

Whatever be the fund, just opt for Growth Option if your holding period is more than one year.

If you plan to invest for less than 1-year in an equity fund (though this is not recommended), opt for Dividend Reinvestment.

If you plan to invest for less than 1-year in a debt fund, opt for Dividend Reinvestment if you are in the higher tax brackets.?

I am not talking about Dividend Payout here because in most cases you don't depend on dividends to take care of your daily needs. Money coming in through the dividend is just a psychological comfort.

Follow this 4-step process and you will be able to suitably deploy your money in the 'right' funds and avoid getting into any 'wrong' ones. Note that here 'right or wrong' doesn't necessarily mean that the funds are 'good or bad', but only whether they match your profile or not. This will help you to achieve your financial objectives safely and surely

rgds.,
Japan Shah
japan.shah@gmail.com

Sundaram BNP Paribas Select Midcap....

Fund Objective:

The scheme aims to achieve capital appreciation by investing in mid-cap stocks. The fund defines 'midcap' as a stock whose market capitalization shall not exceed the market capitalization of the 50th stock (after sorting the securities in the descending order of market capitalization) listed with the NSE.

Fund Manager: N Prasad

• Since: Mar - 2007
• Mr. Prasad holds a M.Com degree.Prasad has 15 years of work experience including 8 years experience as fund manager in various mutual funds

About the fund:

• The phenomenal returns generated by the fund have brought in huge investor interest in this mid-cap-oriented fund. Its assets have grown exponentially from Rs 500 crore in Jan 2006 to Rs 2,203 crore
  This fund has clearly been one of stars of the recent bull run in the mid-cap world. Launched in July 2002, the timing was perfect for Sundaram BNP Paribas Select Midcap.
• As the mid-caps started gaining momentum on the bourses in 2003, this fund brought home handsome gains for investors.
• The fund ended 2003 as the third-best equity fund with returns of 157.73 per cent.
• As the mid-caps slowed in 2004, Sundaram Midcap's returns too slowed a bit. The fund again hogged the limelight in 2006 with a return of 60.77 per cent, the second-best in the category of diversified equity funds.
• The phenomenal returns have brought in huge investor interest in the fund and assets have grown exponentially from Rs 500 crore in January 2006 to Rs 2,203 crore at present.
• However, the year to date return of Sundaram BNP Paribas Select Midcap may not be appealing as the mid-cap stocks faced heat on the bourses.
• The fund likes to keep substantial portion of its portfolio in cash (almost 20-30 per cent), though in May it reduced its cash holdings to 5 per cent.
• Although the assets in cash remain unutilised, the fund uses the cash for value buying during market falls. Holdings like Lakshmi Machine Works, Thermax, IVRCL Infrastructures have done wonders.
• The fund has highest exposure to metals and metal products sector. Of late, the fund has gone overboard on diversification. With the growth in AUM, it has been increasing the number of stocks in its portfolio too.
• What used to be a 60-stock portfolio in late 2004 has swelled into a 112-stock pack by April 2007.
• The problem is that such a huge portfolio can dilute the returns. Although there is the inherent volatility of the mid-cap universe, the fund is capable of rewarding the investors handsomely.
  

What is EPS, its uses and limitations...

What is EPS?

• 
  EPS is a measure to track the profitability and success of a company on a per share basis. It is a significant determinant of the price of a share.
• Mathematically EPS is the net profit or loss, less preference share dividends, divided by the weighted average number of shares outstanding during a period. The number of outstanding shares could vary owing to the company buying back shares, issuing fresh equity, conversion of debt to equity, etc.At the same time a company often has other financial instruments floating in the market that could be converted into equity.
• This potentially convertible equity could dilute your holdings.
• In order to take these into account, the concept of diluted EPS emerged. The two quoted figures can be quite different and you need to know what your share in the earnings will stand at if all the options of dilution come into effect.
• Companies report trailing EPS which is the based on earnings of the past year. You will often come across terms such as current and forward EPS, these figures are based on estimated earnings of a company.

How do you use it?

• Just the way an investment decision made solely on the price of a stock or NAV of a mutual fund, is deficient, stand alone EPS bears no meaning.
• It is used, primarily as a tool for comparison.
• At the same time you can't compare the EPS of companies functioning in different industries.
• In making an investment decision, one can analyse the rate of change in EPS in the last two quarters and compare this change to the EPS growth rates in the past three to five years. This would indicate if the company is on track in the current fiscal.
• As a tool for inter firm comparison, EPS gives you an indication of the return on investment made.

Limitation?

• EPS does not take into account the market price of a stock and its use is limited to gauging the earning consistency of the company.
• When analysing EPS you must also look at the price earning ratio as well.
  
  

rgds.,

Japan Shah

japan.shah@gmail.com

Kotak MF Gold ETF..

Kotak Mutual Fund has emerged as the third fund house, after Benchmark and UTI, to launch a Gold Exchange Traded Fund .

• Name of fund: Kotak Gold Exchange Traded Fund
• Scheme: Open-ended, gold exchange traded fund
• Objective: Generate returns that should be in line with the returns on investment in physical gold.
• Asset allocation: Physical Gold: 90% - 100% / Debt and money market securities: 0%-10% Fund opened: June 20, 2007
• Fund closes: July 4, 2007
• Face Value: Rs 100Minimum investment amount: Rs 5,000
• Fund Manager: Ritesh Jain
  

The fund is good for getting the advantage of the fluctions in gold in the short term and also to benefit the appreciation in the value of gold in long term..

rgds.,

japan shah

japan.shah@gmail.com

Significance of PE Ratio...

• The PE ratio is the current price of the stock divided by the reported earning per share of the stock.
• As a result the PE of a stock is subject to daily change.
• Since, the future earnings of a company are often built into the price of a stock, the PE ratio signifies to what extent the price is valued at the earning of the share of the past year.
• It is essentially the price you are willing to pay for Re 1 of a company's earnings.
• Given that future earnings of a company are uncertain, robust companies are able to extract a premium for their earnings. It has little to do with the returns that a stock could deliver. As a result you cannot use it as a means to forecast future performance, to elucidate further; PE of 18.50 times does not mean that the stock price will essentially grow to 18.50 times. It only means that investors are valuing the stock at 18.50 times of its earnings.
• Price to book value ratio (PB) compares a stock's market value to its book value (book value is assets minus liabilities). A lower PB could either mean that the stock is undervalued or that there is something fundamentally wrong with the company. PE and PB are used more as tool for comparison between stocks belonging to a certain peer group as stand alone PE does not signify anything.
• As far as mutual fund units are concerned the PE and PB are arrived through a weighted average of the inherent stocks. As a result, you shouldn't assign as much importance to a mutual fund's PE and PB as you would give to a stock's PE.
• High PE and PB relative to a category would indicate that the mutual fund holds stocks that are currently quoting at a premium and points towards a growth oriented strategy. If you are investing in a value fund, then expect the fund to have a PE lower than that of growth funds.While short-listing funds going through each funds PE and PB can be quite cumbersome and misleading.

rgds.,

japan shah

japan.shah@gmail.com

Birla Sun Life Frontline Equity Fund declares 40% divident...

Birla Sun Life Mutual Fund has announced a dividend of 40% (i.e. Rs.4.00 per unit on the face value of Rs. 10) under the dividend option of Birla Sun Life Frontline Equity Fund. The record date for the same has been fixed as June 29, 2007.

This is the sixth dividend being declared by the fund since its inception. Earlier in August 2006, the fund paid 60% dividend.

The returns of the fund are also very impressive...
1 year : 43%
3 years: 46%
since inception: 48%

The returns are very consistent and the NAV in the divident option post divident is 22(approx.). The fund is good for the one who have good risk appetite and the returns are also very consistent. it is a promissing fund to invest..

rgds.,
japan shah
japan.shah@gmail.com

Good news for MF investors....

Its a good news for investors in mutual funds.. the SEBI has decided to incerease the deadline of PAN card as the sole document for investing in the Mutual Funds from 2nd July to December. It has also mentioned that the investors will have to give the copy of application form for the PAN card for the time being.. But the news is good for the investors and the Mutual Fund companies...

The move from SEBI seems to be have come from the lobbying of the Mutual Fund companies, as the compulsion of PAN card would have reduced the flows of funds in the mutual funds...

Anyways its good for investors.. so happy investing...

rgds.,
japan shah
japan.shah@gmail.com

DLF Close to winning 3000 crs project... Biggest in the country

DLF appears close to bagging a Rs 30 billion convention centre project in Delhi, possibly the biggest in the country, as the company is the only bidder for developing the facility.The 35-acre project that includes land cost and lease was offered for bidding by the Delhi Administrative Authority. DLF is the sole bidder virtually bagging the project at Dwarka.DDA spokesperson said it has received only one bid for the convention centre project from DLF. The authority was yet to decide on the outcome of the bidding price, she said.The DDA spokesperson said the bid was yet to be opened. If DLF wins this project, it would be the company's first major deal after the public offer, which was the country's largest IPO of Rs 9,187 crore (Rs 91.87 billion).The convention centre project would comprise a conference hall spread over 72,000 sq ft with a seating capacity of 6,000. It would also have one or two hotels with 800 rooms. Besides, it would have the largest retail mall in Dwarka and one million sq ft of commercial space.

If this deal kicks off then the investors interest in the stock would incerease and the price moment of the stock to be positive after the listing...

rgds.,
japan shah
japan.shah@gmail.com

Lessons on Investing in Stocks

As an investment advisor, I get lot of queries from many investors and here is what i have found and what can be done.

Here`s a sample:`I bought this scrip last week and it is down. Should I sell?`
`The markets are trading at a peak. Is it right to invest now?`
`I want to make maximum returns in minimum time. Suggest some stocks.`
`Which are the stocks worth buying with price less than Rs 50?`
`When will the market correct? I want to invest in some good shares.

`This kind of approach to investing in equity is a recipe for disaster.There are some serious problems here. Let`s pick up some important lessons.

Lesson 1
The moment the prices of scrips drop, say, by 5-10 per cent, we get worried. In that anxiety, we want to sell and get out.Let`s say the Reliance [Get Quote] share you bought last week is down 10 per cent. So what? Will Reliance business close down? Or will Mukesh Ambani run away with your money? No.The movement in stock prices has no impact on the business. Reliance will continue to make profits and grow. Mukesh Ambani will continue to build world-class projects. If that is the case, Reliance shares will see new heights in future. Why bother about these falls, which likely will only be temporary?The problem is, we buy stocks, not businesses. The Tatas and Birlas have been around for over 100 years. Hundreds of successful companies have run for decades and continue to grow irrespective of the stock market volatilities.Yes, some businesses succeed, some fail. There are ups and downs. That is the inherent nature of a business. But, in the long run, they will make profits and grow. That is where management counts. Good managements run profitable operations.Second, that`s why we diversify. Even if we lose money in a few stocks, we will still make lots of money in others.Moral: Buy businesses, not stocks.

Lesson 2

Recently, I read that if you had invested Rs 100,000 in Infosys [Get Quote] at the time of IPO, it would be worth about Rs 64 lakh (Rs 6.4 million) now. But how many people made that kind of money? None, I guess, except the employees and a lucky few who bought the shares but forgot about it.Answer honestly: wouldn`t you have sold the shares when it doubled or tripled or became a ten-bagger? How many of us would have had the patience to hold on?The problem is, we watch stock prices, not businesses. If people had kept track of the business, they would have seen the company had the potential to grow at 30-40 per cent per annum. Then they would have never sold their shares.I know many people who got out at 10,000 Sensex levels, thinking the markets will correct and they will re-enter at lower levels. They are now ruing their decision. The problem: they were so obsessed tracking the Sensex that they didn`t see strong economic and business growth.Moral: Watch business growth, not rise in stock prices.

Lesson 3

The moment people buy a stock, they expect it to double soon. They see the stock ticker 10 times a day. They call their broker a couple of times daily to find out what is happening.I have one question for such people. Can you set up a steel plant in one day? Can you build a power plant over the weekend? Can you start a mobile company and expect to have 1 million customers on Day 1? No.Businesses take time to set up, acquire customers and generate profits. Only when the companies increase their profits will the share price also increase.Therefore, having bought a good business and good management, give it time to prosper. If you don`t have the patience, you might as well go to a casino or call-up Shah Rukh Khan at KBC.Moral: The stock market is a serious long-term business, not a make-money-overnight casino.


Lesson 4

Another interesting aspect is the stories we hear in local trains, buses, parties, offices, of how so-and-so doubled/ tripled his money.We end up feeling like fools not to invest in the market. At the first opportunity, we buy a few stocks without proper research and understanding.I am not saying they are lying. But I would like to ask them about their other investments too. More often than not, for every successful investment, they would have made five other poor investments and lost money. They won`t tell you about those.The point is, when our investment is motivated by others` half-truths, we never have the patience and discipline required for successful equity investing.Moral: Don`t be fooled by others` so-called success stories.


Lesson 5

As I mentioned earlier, people sold looking at the Sensex levels and lost out on the huge potential profits. There are many waiting for the Sensex to fall to the `right` levels to enter the market.There are two points here. I highlighted one earlier: watch the economy not the Sensex.Second, timing. Given that humans can switch from irrational exuberance to extreme pessimism and back in a matter of days, I believe even God will find it difficult to time the markets.Moreover, I bet not even 1 per cent of you will enter the markets if they started crashing from tomorrow. The Dalal Street [Get Quote] was totally deserted during the historic crash of May 2006, which was actually a great time to buy.So I suggest let`s get over this fixation with timing the markets. Let us look at business potential and invest with a long-term perspective.Moral: Time in the market is more important than timing the market.


Discipline and patience - that is the mantra to creating wealth on the stock markets. Unfortunately, both are in short supply. If you have them, you make your riches. If not, you could be in trouble.I am not very sure how many would agree with the above lessons or even follow them.


Such is human nature: guided by greed and fear, than by reason and logic.


For further assistence mail to: japan.shah@aol.in

reason 4 unitech goin up up n away........

many ppl have been asking abt the reason 4 unitech goin up ........Unitech management seems convinced of foreign investor's faith in India's real estate story more than it has in domestic investors on Dalal Street।To beat the experience of DLF, Unitech now wants to go to London and list a new subsidiary in the United Kingdom.For a company which has investment plans of upto Rs 25,000 crore setting up a subsidiary in a foreign country, which has enough NRI cash floating around, seems a viable option.Unitech may list the company in UK and then bring in the funds into projects, which meet FDI compliance conditions.The foreign subsidiary in the United Kingdom will be listed to raise money of upto a minimum of $500 million.The funds raised by the foreign arm of Unitech will invest in land projects of at least 50,000 square metres.Unitech has confirmed that it will be announcing a massive land acquisition program soon in North India."I think they have benefited tremendously from the fact that they are already listed way before the real estate story became something which was real," said Anand Tandon, Director, Gryffon Investment Advisors."The fact that SEBI and RBI have been driving the fleet over allowing new funds to come in the form of private equity means that listed companies have a big advantage in terms of being able to raise capital," Tandon added.The stock price of Unitech, which has baffled many, was once again on the rise hitting the 10 per cent mark once again.After the DLF setback domestic investors have raised doubts whether the real estate stocks can demand as high a price as was expected in DLF' .

for further queries mail to japan.shah@gmail.com

Rupee ends at new 9-year हाई, ग्रोविंग स्त्रोंगेर ऎंड stronger

Spurred by strong foreign capital inflows in a booming economy, the rupee today closed at 40.4975 per dollar against yesterday`s close of 40.51/52
The rupee on Tuesday closed at a new nine-year peak even as Commerce Minister Kamal Nath expressed concern about the partially-convertible currency's sharp appreciation against the dollar this year.
Spurred by strong foreign capital inflows in a booming economy, the rupee today closed at 40.4975 per dollar against yesterday's close of 40.51/52. It opened at 40.48/50 and hit a high of 40.46/47 in morning trades before ceding some ground.
The Indian currency crossed 40.50 yesterday and reached as high as 40.28 on an intra-day basis. But, the central bank's intervention through public sector banks brought it down from the highest level since May 1998.
The Reserve Bank of India (RBI) has allowed the rupee to rise by over 9% this year to fight inflation, but going forward the central bank may slow the pace to protect exporters. It is the best performer currency among 16 most-active currencies in Asia.
The Government is concerned about the rupee's appreciation and is in talks with the central bank regarding the same, Commerce Minister Kamal Nath said today in Mumbai. "It is a matter of concern not only to our exporters but also to our manufacturers as there is a possibility of cheaper imports replacing manufactured products," he said.
According to official data Foreign Institutional Investors (FIIs) have pumped in about US$4bn into local equities this year after investing nearly US$8bn in 2006. Plus, a lot of overseas money is waiting in the wings for the blockbuster IPOs of real estate major DLF and banking giant ICICI Bank.
JPMorgan Chase expects capital flows to exceed US$5bn in the next eight weeks as companies including DLF and ICICI Bank sell shares.
Foreign Direct Investment (FDI) equity inflows in the fiscal year 2007-08 will be almost double the amount received last year at US$30bn, Nath said today. At US$15.7bn, FDI inflows last year were much higher than FII inflows.
The Indian economy, fourth-largest in Asia, is estimated to have grown by 9.2% in the fiscal year ended March 2007, the fastest pace in almost two decades, Commerce Minister Nath said today.
The rupee is headed for a third straight month of gains, rising 1.8% in May, following the 5.3% and 1.8% pace in the previous in two months, as the RBI is focusing on fighting inflation that accelerated to the fastest pace in two years in January.
RBI Governor YV Reddy in a speech in Tokyo yesterday said that the central bank expected inflation to moderate between 4% and 4.5% to maintain 8.5-9% GDP growth. Finance Minister P. Chidambaram today echoed the same view.
Inflation slowed to 5.27% in the week ended May 12, an eight-month low, a government report showed last वीक

the INR nine years high against USD

The rupee is creating history, so is India. India had been in limelight in the recent years because of the multi million dollar mergers and takeovers. the peoople in India are crazy about the Stock Markets, but don know that the FOREX market is 100 times biger than the equities market. u wont beleive that the turnover of the forex market is more than 1.5 trillion dollars in a day..

The Indian Rupee is creating an history against the US Dollar. The rupee is trading at a nine- year high at 40.89(on 18-5-2007). The rupee is expected to further appreciate due to more and more dollar pumping in the country.

An important factor is that the dollar is comming in all the sectors and not only the equity market. The RBI not interventing is also an reason for the appreciation in rupee. But, in the end it is the impoters and expoters who are affected by such volatilen forex market and now it has been compulsory for them to hedge.

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