Is It Safe to trade With Loan Money??

Indian stock market is one of the grooming trading platforms for worldwide investors .Investing in Indian stock market is a big chance for traders to earn money. But due to lack of knowledge many of them go for wrong strategy due to which many traders trying to invest the loan money in the market then they should think over twice. Many investors started trading with loan money, Is it safe?? The answer is NO. So be careful don’t let your money waste. Now we will go to discuss some points why not to trade with loan money.

First let us have look what is loan money?? People usually take loan from bank when they have urgent requirement of money with the deal of being repay the amount within in certain period of time and also pay the interest of the loan they have taken. There is also various types of loans available such as home loan, personnel loan, education loan. Rate of interest may vary depend on the loan taken.

What happens if you trade with loan money??

As it is unpredictable to examine the stock market as it moves up and down, we are not sure about the scenario what will happen to next day. There are many investors who do day trading suppose you invest loan money in day trading and get a profit return and on next day if market clashes then think over your loan money?? You will loose everything so how will you repay your loan money.

Lastly it can be said that be careful while investing, consult with an research analyst in spite of bearing any loss.

Want to know more detail visit us: http://capitalstroke.com or contacts us: 919770670009, 0731-3299704 

Read More

Stock Buying Tips

Stock market a big platform for investors in terms of profit return. But it should be very necessary to have right knowledge about which shares one should buy or sell while trading. Although there are certain   strategies to follow which guide regarding the proper choice of stocks which have the potential to return you big profit. We are going to describe those factors are as follow.

1.Sales Revenue - It is the amount of money that a company earns during a financial year Revenue can be calculated by multiplying price of goods and services at which it is sold to the number of units or amount of unit sold.

2.Earnings - Net income of a company that shows the figure of a company whether it is losing money or gaining. It is one of the factors which show company potential and financial strength in the market. So it is clear that an investor likes to invest in a company which has strong financial earning.

3.Debt - The amount of money that a company owns in different ways. So it should be better to invest in a company which has relatively low or no debt level.

4.Liquidity - Liquidity shows the cash holding position of a company. Company which expands its area and volume of business and assures high profit gain for investors is considering being a good investing stock.

5.Valuation - It’s the worth of a company which can be determined by the P/E ratio

Last but not least while investing one should have to do research about a company profile with the  annually report publish time to time.

For more detail visit us: http://capitalstroke.com  or Call us 919770670009, 0731-329970

Read More

A Mapping of India’s Trade

India’s economy is growing day by day as compared to GDP over the past few years. Since 1991, the International trade strengthens the country’s economy due to the liberalization. Due to which the ratio of international trade to GDP has rises continuously with certain factors.

We are going to classify these factors into three categories

1.The Demand of India’s Export of Goods and Services

2.The Supply of India’s Export of Goods and Services

3.The Demands for India’s Imports

1.Factors that affect Demands for Export- India’s trading factor depend upon the intensities of India trade relation with other countries such as North America, the Middle union, Middle East, Asia and south Asia. Although US market adversely affect the demands for products.

2.Factor Affecting the Supply of Exports- It has been observed that India’s is unable to fulfill the supply scheduled due to following reasons are as follow.

a.Infrastructure Bottleneck - This is one of the critical factors in fulfilling the supply order. Due to power shortage, delay in transportation and less efficient techniques proves to be failure in demand supply.

b.Domestic Demand Growth - The huge growth of domestic demands lessen the exporting products.

c.Inflow of Export-Orientated Foreign Direct Investment -  MNE’S play a great role in the manufacturing of exports from East and South –East Asian countries as they provide  good investment platform from US and Japanese MNE’S.

3.Factor Affecting the Demand for Imports- Due to the overall growth of the economy, trade liberalization and growth changing factors, increases the surplus demand for import. The performances of Indian industry generated a tremendous optimism and sustain an existing competitive platform for future time.

For more detail visit us http://capitalstroke.com

Read More

Derivative Market

A derivative market are based upon another underlying market which includes stock market, stock indices and currency market .A financial market which is a derivative market or financial instrument just like future contracts or option that can be derived from other forms of assets.

Underlying assets in derivatives

a. Precious metals like gold and silver
b. Foreign exchange rate of currency
c. Bonds of various types including long and short term negotiable debt
d. Over the counter(OTC) money market products such as loan or deposits

 Classification of derivatives

a. Forward Contract - A forward contract or “specific delivery contract” occurs between buyer and seller where long position holder (buyer) agrees to buy an underlying asset in future with a certain price. Forward contracts are traded over-the-counter and are not allowed to deal with exchange. As this contracts are bilateral contract. Forward contracts are very popular in foreign exchange market.

b. Future Contracts - An agreement between two parties of buying and selling of an asset with a specific quantity, time and place. These contracts allow trading in exchanges which defines certain standardized norms for future contracts.

c. Option Contracts - Option contracts are those contracts which give the right but not the authority to buy and sell the asset before its specified time or date. Option can be traded in various instruments commodities, financial asset, stock index petroleum products, metals etc

d. Swap Contracts - An agreement over a predefined interval of time between two parties to exchange assets. These are generally customized transactions and are helpful in problem of price fluctuation forex market.

For more detail visit us: www.capitalstroke.com

Read More

Stock Market Index

 A stock market index is the measurement of value of a section or it’s a tool used by investors to keep track of changes in market value. It is one of the best means to check economic situation. It is mainly used in analysis and investment decision making.

                                             

Stock index can be classified as

1. Value Weighted Index - In this type of index each stock affects the index value as compared to market value.

2. Price Weighted index - A price weighted stock is the average of prices all the stock included in the index. Consider an example a price weighted index containing 3 stocks - Stock A priced 10 dollar, Stock B priced 40 dollar, Stock C priced 100 dollar. The average of this stock price is 10+40+100 can be divided by no of stocks in the index which is 50.         

Popular stock market indexes in India

Index	Sample size	Base year	Base value	Weighting Typs
BSE Sensex	30	1978-79	100	Value Weighted
CNX Nifty	50	1995	100	Do
RBI Index	338	1981-82	100	Un-Weighted
BSE National	100	1983-84	100	Value
Economic Times	72	1984-85	100	Equal Weighted
Financial Exp	100	1979-80	100	Value

Factor affecting in construction of Stock market Index

1.Sample Size

  -Statistically significant large enough sample should be taken

2. Representativeness

  -It represents total no of population and its essential characteristics of interest

3. Base year

  -It should be a normal year

For more detail visit us: http://www.capitalstroke.com

Read More

Basics of Option Trading

An option is a contract that gives the owners the right, but not the compulsion to buy or sell a particular asset before its specific date. An option is just an security aspect which includes stock and bonds. Its an agreed contract with certain terms and condition mentioned in it.

Still Not clear?? Just look at these example, You want to purchase a expensive new house but you don’t have sufficient money to purchase it for another two months, now you contact the dealer to provide an option to buy that house in two months for a price of $200,000, the dealer will agree and now for this option you have to pay $3000.People who purchase an option are called holders and those who sold option are called writers.

Now option trading can be done in two ways

1 Call Option - A call gives an authority to holder to buy assets with certain price during a particular period of time with the hope of increase in price of the stock before option expires. Trading in Calls has long term position.

2 Put Option - Put gives the right to sell an asset with certain price during a fixed period of time, puts can hold the stock position for short position

Read More

Want A Stock Market Investing Solution

Read More