Financial Oracle

  Easy money multi commodity exchange(mcx) has many derivatives contracts of farm produce, metals, precious metals and energy. It's not easy to predict a price of precious metals but the beauty of these financial instruments is that they never break their historical volatility index meaning that within their price band a person can earn money just by investing in the morning and reversing the trade at the end of the session. the session begins at 9 a.m in the morning and ends at 11.30 pm in the night, yes the market is open for the entire day, so it not only for the early risers even the afternoon risers can earn some easy money from this method. Let us take gold guinea which is a futures contract on mcx whose underlying asset is 8 grams of gold you can see that gold has dropped on Monday and since then has been pretty much stable now how can a person capitalise on price fluctuations. the price fluctuation for this contract is 300-450 that means if its prices are fallen for 300 rs ...

 What are the futures contract? In a simple words futures contract is a derivative instrument which is obligated to buy or sell a commodity on a predetermined rate at a determined time and quantity. Derivative contract means that it has no value of its own but the value of the underlying asset. An underlying asset can be anything Stocks, Commodity, Currency, etc. History of the futures contract   Futures contract came into existence in the 17th century by the Dutch empire who were the pioneers of financial markets but the dutch case of futures is not relevant today so we may skip that. The first modern Future contract was executed in 1972 for agricultural commodity price swings. It was created to help instituional investors mitigate price volatility and when the agricultural market flourished metal and crude market demanded because after the 1973 oil embargo it become as necessary to a economy as oxygen is to human. You can see how successful was this venture and now the major...

What are Financial ratios A  financial ratio  or  accounting ratio  is a relative magnitude of two selected numerical values taken from an enterprise's   financial statements . Often used in  accounting , there are many standard   ratios  used to try to evaluate the overall financial condition of a corporation or other organization. There are mainly three parameters for stock market analysis such as balance sheet, Cash flow statement and financial ratios. It is widely believed that analysing ratios are difficult or tricky but I can promise you after reading this article you will find financial ratios more understandable compare to the other two. 9 most important ratios that matter while buying a stock PE ratio  =Share price/earning per share , what the market is willing to pay for a stock based on its past or future earning. In other words how many years will it take to recover the initial investment amount in the stock, for example, the st...

Quants trading is a strategy that uses complex statistical and mathematical function using automated trading. This model heavily relies on the dataset of price, time, the volume of the stock. what is  Quants trading It uses the historical volatility data of the stocks and recognizes the patterns for a particular stock, sector, index, etc. It is a very complex procedure and can only be done with advanced computers and superfast internet and most importantly different types of analyst that can read the data and make patterns. Everything in this world has patterns be it anything stocks, economy, business, etc. Quants analyst research for months and then come up with a strategy of buying and selling while the base of their research is historical data. After doing their research they develop several different models and test them on the virtual stock market and the model that gives the highest return is selected for trade. History Quantitative finance has a long history and a list of gr...

The algorithmic trading is computer codes that buy and sells when it sees the market is complying with its coding functions. What is Algorithmic trading Algorithmic trading is simple it is just like just we set up an alarm on a smartphone just like that an algorithmic trader(AT) will set some functions on price, time, volatility, etc. If any of these functions have met the market condition then the buying and selling of stocks will take place. for example, I set three programmes that I will buy a TATA motor if the price is at 100 rs per share on market timing and when delivery of stocks is 35%. So if price hit at 100 and delivery is 39% then the order will be rejected it will only be executed when all the programmes met the condition similarly for selling. How much time does it take to execute an order, well a typical AT can trade at least 1 million transactions in a minute. So even if their margin is as low as 1 rs they can still make a fortune. HISTORY    It does not have a ...

  Intraday trading a buying and selling of financial instrument on the same day of the stock market, These contracts evolved with the information and communication technology segment developments. What is intraday? It a simple contract between buyer and broker, A trader has a deemat a/c at angel broking, the trader wants to trade 10000 rs worth of stock so angel broking will buy 10000 rs of stocks on behalf of the trader and the trader has to give a required margin for 20%  if the stock fluctuation break the threshold of 20% then the trader has three options is to sell the contract, to provide more margin or to convert the order into delivery. Intraday typically runs on a simple rule and that buys low and sell high but there are no hard and fast rules for the financial market that you can learn and earn money. Intraday trading riskier because a person jeopardises their investment amount which is not at all advisable at the beginning level, So if anyone ever asks you to do intr...

Ever since the lockdown has lifted its a million dollar question that everyone is asking, we should analyse the market and then decide. Analysis If you have not read my previous article about mutual fund then please read it will help you understand better how mutual fund industry function. before lockdown that is 24 march mutual industry was doing fine, there was routine subscription in the form of a systematic investment plan(SIP). After the announcement of lockdown, everyone went on a sell spring and the stock market collapsed debt-based mutual fund like Franklin Templeton have to shut their business in India due to losses. The important question is why this happens.    Only 6-8 mutual fund gives a 2 digit annual return but when you consider the expense ratio the return will decrease  by1-2%. This is the most important reason why everyone is selling their stake in mutual fund and starts trading in the equity cash market. Subscription of mutual funds has decreased but tr...