Alok MD20nov

8/9/2019 Alok MD20nov

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7/2/2010 (c) CHURIWALA SECURITIESPVT. LTD.

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Market DynamicsMarket Dynamics

Alok ChuriwalaAlok Churiwala ² ²

CHURIWALA SECURITIES.CHURIWALA SECURITIES.




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Understanding MarketsUnderstanding Markets The PlayersThe Players

InformationInformation

VolatalityVolatality

Behavioural EconomicsBehavioural Economics




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The PlayersThe Players




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Market ParticipantsMarket Participants Institutional Investor (FII/FI)Institutional Investor (FII/FI)

Mutual FundsMutual Funds

CorporateCorporate

Retail Investors (HNI·s & Small)Retail Investors (HNI·s & Small)

TradersTraders Jobbers/ ScalpersJobbers/ Scalpers




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Market Participants«Market Participants« SpeculatorsSpeculators

ArbitrageursArbitrageurs

OperatorsOperators




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ObjectivesObjectivesFI/FII·sFI/FII·s Long termLong term

investmentsinvestments

Mutual FundsMutual Funds Long TermLong Term

investmentsinvestments

CorporateCorporate Wealth CreationWealth Creation

Protecting stakeProtecting stake

InvestorsInvestors SavingsSavings

TradersTraders Business ActivityBusiness Activity




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«..contd«..contdJobbers/ScalpersJobbers/Scalpers Create MarketCreate Market

Narrow spreadsNarrow spreads

SpeculatorsSpeculators Gambling instinctsGambling instincts

ArbitrageursArbitrageurs Reduce priceReduce price

differencedifference

OperatorsOperators Create interest inCreate interest ina scripa scrip




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InformationInformation




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InformationInformation Price SensitivePrice Sensitive

Advantage to early recipientAdvantage to early recipient




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SourcesSources Company ManagementsCompany Managements

Banks/ FI·sBanks/ FI·s

Research Outfits/ BrokeragesResearch Outfits/ Brokerages

MediaMedia-- Print / TVPrint / TV

Credit Rating AgenciesCredit Rating Agencies

RegulatorsRegulators

ExchangesExchanges




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Insider TradingInsider Trading Dealing on basis of unpublishedDealing on basis of unpublished

price sensitive informationprice sensitive information

Either on own a/c or anyone elseEither on own a/c or anyone else




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VolatilityVolatility



7/2/2010 (c) CHURIWALA SECURITIESPVT. LTD. 13

Market VolatilityMarket Volatility Human ElementHuman Element

No two people think alikeNo two people think alike

Different PerceptionsDifferent Perceptions

Not the same level of Not the same level of InformationInformation

Too much volatalityToo much volatalityundesiarableundesiarable

Curbed by imposing CircuitsCurbed by imposing Circuits




Floating StockFloating Stock Is that part of the public issueIs that part of the public issue

which is available to the publicwhich is available to the public

Shareholding Pattern (example)Shareholding Pattern (example)Promoters/Directors 51%Promoters/Directors 51%

Employees 4%Employees 4%

FI/ Mf·s 7%FI/ Mf·s 7%

FII 8%FII 8%Bodies Corporate 16%Bodies Corporate 16%

Public 14%Public 14%




Market CapitalisationMarket CapitalisationNo. of shares issued * Mkt priceNo. of shares issued * Mkt price




Listing AgreementListing Agreement Enables trading on exchangesEnables trading on exchanges

Binds companies to discloseBinds companies to disclose

material events.material events.

Prescribes formatsPrescribes formats

Ensures timely disclosuresEnsures timely disclosures

Safeguards general publicSafeguards general public

interestinterest




Behavioural EconomicsBehavioural Economics




Behavioural EconomicsBehavioural Economics Loss AversionLoss Aversion

Sunk Cost FallacySunk Cost Fallacy

DecidophobiaDecidophobia

Endowment Effect.Endowment Effect.




ConclusionConclusion Understanding markets is notUnderstanding markets is not

only a science but also an artonly a science but also an art

TIPTIP

It requires patience & disciplineIt requires patience & discipline

to make money in the stockto make money in the stock

markets.markets.




THANK YOU!THANK YOU!

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Alok MD20nov