Portfolio

Our blog portfolio is currently at Rs. 11.88 lakhs. 

I do not propose to make any change in the same today.

Portfolio

IFCI

On Friday, 1236 contracts of IFCI Call 60 (Oct 09) contracts were traded with an increase in open position in the same by 31% while the IFCI scrip closed at Rs. 56.35.  The IFCI Call 60 (Oct 09) contract price closed at Rs. 2.25 and one lot equals 7880 shares.  Many a times, when there is a substantial jump in turnover of near out of money contracts, the price tends to reach there.  Since we are running a blog portfolio, why not check this out for ourselves. Buying 1 IFCI Call 60 (Oct 09) would cost us Rs. 17,730.  We shall buy 2 IFCI Call 60 (Oct 09) at a total cost of Rs. 35,460.  For people who are new to Options, let me inform you that we risk losing almost entire investment of Rs. 35,460 in case the scrip does not move up.  And this is a very high risk investment in our blog portfolio.  Since this entire portfolio is on paper only and since we consider it as experimental, we can take this risk.  IFCI chart is as follows -

Our blog portfolio stands at Rs. 11.89 lakhs.  Details as follows -

IFCI

Bharati Shipyard

A lot of scrips have shown weakness today and the correction may continue for a couple of days.  Bharati Shipyard [Rs. 205.80] has shown some temporary weakness on charts.  I propose to dispose this scrip from my paper portfolio today so that I can buy some other scrip in next 1-2 days.  I do not intend propose purchase of any security in our blog portfolio today.

Our blog portfolio has gone down to Rs. 11.72 lakhs today.

Bharati Shipyard

IDFC

IDFC (Rs. 147.95) seems to be getting set for a strong upmove with high volumes. 

IDFC

Mercator Lines

Nifty’s movement or lack of it does not seem to be a concern.  The uptrend is intact.  Our paper portfolio continues at Rs. 12.03 lakhs today.  I do not propose to make any change today. 

However, in case, I had to buy a scrip tomorrow, I would probably prefer to buy Mercator Lines.

Mercator Lines

Essar Oil

Nifty has not shown any major movement today.  It failed to hold on to 5000 mark but I don’t think it matters much in the overall scheme of things.

I am not proposing any change in our paper portfolio today.   It has shown increase to Rs. 12.03 lakhs today.  However, in case I would have to buy any scrip today, I would have liked to buy Essar Oil. It has shown a long term price breakout on chart with heavy volumes.

Essar Oil

Ispat Industries, Aban Offshore

Nifty is moving up as we would like it to.  So I shall not cover it today.  I propose to sell Dena Bank today from our paper portfolio.  It has moved up sufficiently and so lets book some profit and get on with the game.  As they say, nobody became a pauper booking profits (so what if it is only paper profits). 

I do regret selling Ispat Industries just as I had regretted selling ICICI Bank from our paper portfolio.  Ispat Industries has shown good movement today and the price action is pretty promising.

 

I would however like to invest in Aban Offshore again for our paper portfolio, though we had sold it earlier.  The main reason is that it’s chart pattern is pretty encouraging and it is likely to substantial amount through a QIP pretty soon.

Our paper portfolio value is currently at Rs. 11.97 lakhs.  We have completed one month of our paper portfolio.  Absolute returns of 19.7% for the month.  Certainly not bad ?  Actually, too good.  Lets continue the good work.

Ispat Industries, Aban Offshore

Nifty, Bombay Rayon Fashions

Nifty has shown strong positive movement again and I am definitely impressed.  This is a market which allows scrip specific action peacefully.  Thus, so long as you are able to identify a good stock, it would deliver good returns to you.

Dena Bank has moved up fast.  Bank stocks are current favourites.  So I do not want to change any scrip in our paper portfolio today.  However, in case I had to include any scrip in paper portfolio today, I would have included Bombay Rayon Fashions.  Reason ? Price breakout from with high volumes.

Any case, our paper portfolio stands as follows today -

Nifty, Bombay Rayon Fashions

Gitanjali Gems, REI Agro

After showing smart gains in the first two weeks, you must have noticed that our paper portfolio like markets is going nowhere.  It happens.  In any case, we have around 11 months to show further gain of 9% on our paper portfolio which should be easily achievable.  But even in this case, we need to be careful.  After showing a good breakout, the market is thoroughly testing tenacity of both bulls and bears.  Our paper portfolio is as follows today. 

Lets review two scrips, Gitanjali Gems and REI Agro.

Gitanjali Gems has just taken support of upward slopping support trendline.  We may need to quit this scrip, if it breaks the trendline.

14 day RSI of REI Agro has shown a strong positive divergence.  The scrip has shown very good volumes on upmoves.  I am positive on this scrip. Let’s see.

Gitanjali Gems, REI Agro

Nifty, Ispat Industries, SKumars Nationwide

Nifty has been consolidating after the breakout above 4750.  The sentiment is overall positive and many participants believe that banks and textiles should show good performance in this rally.  I share their view.  To that extent I regret that we sold out of ICICI Bank in our paper portfolio a few days ago.  Anyway, in financial markets you have to learn to cope with regrets.

Ispat Industries has not been able to break above its previous high after showing a breakout (with volumes) from its downward sloping trendline of price as well as 14 day RSI.  It is still above its trendline and as such we do not have any immediate reason to worry about its price movement.  However, since we are running a paper portfolio, I propose to dispose it off (and book loss) and replace it with SKumars Nationwide.  We shall revisit Ispat Industries again at a later date.

Our paper portfolio would be now as follows -

Nifty, Ispat Industries, SKumars Nationwide

Reliance Industries

Nifty posted modest gains today.  I do not see that as a cause of concern for bulls as FII’s money power is driving this rally. 

Reliance Industries has shown classical breakout from down sloping trendline of highs as well as RSI. Lets buy Reliance in our paper portfolio.

Our paper portfolio now stands as follows -

Reliance Industries

Nifty, Dena Bank

Nifty seems to have finally broken the jinx.  It has broken its resistance with increased volumes to close at 4782.90.  Does not look like this would be a failed signal now. 

Bank stocks showed good strength today.  I like Dena Bank’s stock movement.  It has broken both 14day RSI and price resistance trendline.

Our paper portfolio now would be as follows -

Nifty, Dena Bank

IDFC, Reliance Communications (RCOM)

Nifty bounced smartly from its supporting trendline on Friday.  Next few days are bound to be interesting. 

IDFC along with Jaiprakash Associates would be join Nifty from October 20, 2009 in place of Nalco and Tata Comm.  IDFC has shown a fresh 10 day high and RSI has shown marginal breakout. We may add IDFC for our paper portfolio.

Reliance Communications (RCOM) has shown upward breakout from its long term downward sloping trendline.  Since Reliance Infratel in which RCOM holds around 95% stake would be coming out with an IPO in next few months, I think RCOM valuations have to be much higher.  We will include RCOM in our paper portfolio.

Our paper portfolio is now as follows -

IDFC, Reliance Communications (RCOM)

Nifty, Balaji Telefilms

Nifty made valiant efforts to touch a point higher than yesterdays high of 4650.35.  It failed too many times today. The only saving grace it had for the day was that its low for the day was higher than yesterdays low, which means today was an inside day for Nifty (which further means that the market is not sure of which way to go).  A strong move on a day after inside days at any critical point can reflect the final change in direction. 

Cards seems to be stacked in favour of bears for the time being.  Shanghai Composite Index  has shown a very strong move today.  However, such moves generally need confirmation (i.e. markets have to test the strength of move by falling again to some extent).

I still remain uncertain on Nifty and therefore would not hazard any fresh purchases now.

Balaji Telefilms has given us decent returns in our paper portfolio and therefore I would like to book some profit (especially considering that I am not very bullish on Nifty).  It may be noted that I am not suggesting this out of any technical indication for sell.

Our paper portfolio would now be as follows -

Nifty, Balaji Telefilms

Nifty, NMDC

Nifty fell down marginally by 17 points to 4608.35 above the upward sloping trendline.  Going by the FII cues, it seems Bears will have their way now for some time.  If not tomorrow, then in very near future.

NMDC has broken its upward supporting trendline.  I therefore feel obliged to sell it.  Does not make sense hoping that it is a false bearish signal since the volume was too low.  In any case, classical technical analysis does not consider volume as a strong indicator when downtrend is setting in.  If it is there, it only reinforces the indication.  The caveat to this paragraph is that I can still be proved wrong by market.  But we have to do what appeals to us at the given point of time. 

Since I am not sure of any upmove by market, I do not propose to add any scrip to our paper portfolio today.  Our paper portfolio would now be as follows -

Nifty, NMDC

Nifty, Prime Focus, ICICI Bank

The bears hit back with a vengeance today and Nifty closed 110 points down from its high of the day amidst very very high volumes. This is ominous. 

Since it looks as if the markets would show further fall tomorrow, we shall not buy anything in our paper portfolio today.

We shall however sell two scrips, Prime Focus and ICICI Bank.  In both these cases, today’s high price was above yesterday’s high and close around yesterday’s low with higher volumes.  Though both are above their trendline support, I am selling them as I am not quite sure of how markets would move in next few days.  However, let me confess that selling these scrips is not based on any strict technical signals applicable to a medium term investor.  If we have booked some profits / acceptable losses, we can be back in market when we are more sure of how market is likely to behave.

  

Our paper portfolio now stands as follows -

Nifty, Prime Focus, ICICI Bank