Warren Buffet's Advice

I got this from one of my colleague & thought of sharing with all my readers. I am sure some of you have would already read it, but people who haven't they can go through.

Even though this advice came in 2009, I think these thoughts are applicable all time...

We begin this New Year with dampened enthusiasm and dented optimism. Our happiness is diluted and our peace is threatened by the financial illness that has infected our families, organizations and nations. Everyone is desperate to find a remedy that will cure their financial illness and help them recover their financial health. They expect the financial experts to provide them with remedies, forgetting the fact that it is these experts who created this financial mess.

Every new year, I adopt a couple of old maxims as my beacons to guide my future. This self-prescribed therapy has ensured that with each passing year, I grow wiser and not older. *

This year, I invite you to tap into the financial wisdom of our elders along with me, and become financially wiser.

* Hard work: *

All hard work **bring **a profit, but mere talk leads only to poverty.

* Laziness: *

A sleeping lobster is carried away by the water current.

* Earnings: *

Never depend on a single source of income.

At least make your Investments get you second earning)

* Spending: *

If you buy things you don't need, you'll soon sell things you need.

* Savings: *

Don't save what is left after spending;

Spend what is left after saving.

* Borrowings: *

The borrower becomes the lender's slave.

* Accounting: *

It's no use carrying an umbrella, If your shoes are leaking.

* Auditing: *

Beware of little expenses;

A small leak can sink a large ship.

* Risk-taking: *

Never test the depth of the river with both feet.

Have an alternate plan ready

* Investment: *

Don't put all your eggs in one basket.

I'm certain that those who have already been practicing these principles remain financially healthy. I'm equally confident that those who resolve to start practicing these principles will quickly regain their financial health.

Let us become wiser and lead a happy, healthy, prosperous and peaceful life

Historic Move From Government In Oil Price Deregulation

Today EGoM (Empowered Group of Ministers) headed by Mr. Pranab Minister agreed(Partially) for Kirit Parikh recommendations of oil price deregulations.

Today EGoM decided that, Petrol price will be fully decided by the market forces & other petroleum products like Diesel, Kerosene & LPG prices by partially depending on international oil price movement.

Today during market hours only this news came in & all oil marketing stocks closed very high even though market closed in negative.

According this deregulation,

1. Petrol will cost around Rs 3.5 more
2. Diesel price will be hiked by Rs. 2
3. Kerosene by Rs. 3
4. LPG by Rs. 35

This is one of best move as compared to longer time future of the country's economy, even though in short term it will leads to inflationary pressure as present inflation itself is very high as compared to RBI's comfort level. One more advantage is in shorter term, fiscal deficit of the country will be reduced due to less subsidizers to oil companies.

Now coming to stock market point of view, this move is good for longer term as ratings of the companies & country will be stronger as compared to past & present ones. And as I told earlier, almost all oil marketing companies closed with more 5% jump to their previous closes. But at same time stocks from Auto, Banks, Shipping & etc started falling as in the anticipation of oil price hike leads to

1. Less demand for auto sales
2. RBI's interest rate policy team may increase rates anytime sooner than later
3. Increase in the cost of shipping & transportation & etc.

Markets Moving In Trendlines

If you see the markets from 2009 October - September markets (Almost all world markets) are trading in the trend line pattern . Nifty after hitting low of 2700 & consolidating from September 2008 to march 2009, it has given almost 90% return, Nifty touching sub 5200 levels.

But if you see from 6-8 months market is moving in the trend line only...

For example May 2010 market moved in negative trend & after that is moving in +ve trend. This trend will face strong resistance at 5380-5400 levels and may continue till 5500 levels. But above 5500 level this trend line will break so psychologically Nifty may not cross it easily. Breaking that level leads fresh bull rally in markets but which may require global support as well strong quarterly results...


If you see the above chart it has support level at 5250 according to trend line & as well as Exponential Moving Average @5190-5200 levels. If you see recent stochastic its leading to little correction which is supported by high volume.

And at the same time if you see broader trend from October 2009 to till now market is the range of 4600 to 5550 levels. Market is not able break this trend & leading to a long consolidating for coming days.


Bottom line:

So I think instead of focusing on market returns investors should spot some mid caps & small caps to good returns as compared to consolidating broader markets.

Range bound trading market

I am back guys... I know now a days my comebacks are more than the postings. But what to do, now we are no more in college (IBA!!!), we are in competitive & exhaustive corporate world, in addition to all this changing house & again getting internet(BSNL) is biggest challenge in metros.

Now coming to today's posting, from last two weeks world markets have seen greater turbulence. Our markets from last 15-20 days were so volatile, intra day trader & short term traders almost lost their track because European Crisis. Started with Greece crisis, spread to Spain & now Hungary. All these incidents are leading to slow recovery if not double dip recession in world economy.

Now coming to our market if you remember, in last posting about Sensex (12th April to be exact) I have given a broad range for sensex from 16000 to 19000. And in this short correction & pull back, market almost bounced back from 16000 levels.


If you see the graph carefully drawing the lower lows & higher highs, now also market has the range of 16000 to 18400 to be precise. Once this range breaks then only we can say market will take either bullish or bearish direction. So until then it is better to book profit when market reaches to these levels whatever may be the positions (Long/Shorts) we are holding.

And if you see later part of the graph I have drawn couple of more trend line which are indicating Symmetric Triangle around 17000 levels. So from 17000 levels will be Doji state where in market may reverse itself from current trend or continue but with lot of momentum. So traders should be very careful @ this level.