Win Dalal Street

Frequently asked questions (FAQ)

How much money is required to begin with?

An investor can start from small capital of Rs.5000 to Rs.10,000.But one should start either with Primary market (IPO)or Delivery based trading with Stock from Sensex or Nifty

Which is the right time to enter in stock market:

Remember, India is on Long term bull market, But as a beginner one should start investing during correction or market falls. As if beginner enters in market at higher levels and make loss with even any of small corrections. Then most people Make exit and blaming markets/brokers or anyone else!

I have saving of 1 Lac rupees, then how much amount should I invest in stock market?

We suggest to invest 30/40% of your existing saving amount, That also with proper management, after making own Research and studies and most importantly invest in various steps. Investing full amount at a time is not advisable.

If I invest Rs.1 Lac, in what time should I make 5 lac out of stock market?

If you want to make 5 Lac out of 1 Lac, please do not enter in this stock market, as this market will never give fantastic returns in over- night! But if you are happy if market give returns of 15-20% per annum, then only you can enter in this market!

Many people make millions from stock like Infosys or Eicher motors etc..How to locate such stocks?

No one in the world will suggest you such stocks, Anyway with own research and your own studies you can You have to find some good fundamental stocks. Any good Fundamental stock will always give excellent returns for longer term. For that one has to check popular traded stock year after year, growth in stock profits and even one can get idea from observation of top performing mutual fund portfolios. But remember any stock with 15-20% price rise per annum will be very attractive to get in portfolio.

Can I earn in Bearish/Down trend market?

If you strictly follow basics then off course you can earn in bullish as well as in bearish markets. As one can Sell/short stock or Put option calls are very profitable in Bearish markets!

Sensex and Nifty is getting higher every time but my portfolio is always in loss. What should I do?

This is the major problem for every investor. One has to check portfolio on regular basis, has to find performing and non-performing stocks. Actually main reason is that. People sell their best performing stock with marginal gains and hold non performing stocks for many years without keeping in stop loss. That is the basic reason! If you Track/watch Sensex or Nifty stocks then you will realize that even stock exchange add/remove in their index stock on regular intervals. So if you likes to book profits, then you must digest to book loss for non performing stocks!

I came to know people make lots of money in F&O market. What is your opinion?

One has to know that F&O market is subjected to higher risk as compare to Equity trading. So if you are beginner or having very limited funds for stock market, kindly at this time you should make paper trading or tracking this F&O market. One must gain your own experience then only enter in F&O markets!

I got messages from some broker, Buy 10,0000 shares of XYZ at 10.50.Target 20 in short time,100 target in 1 year. Don’t miss buying opportunity. What should I do?

Kindly ignore and delete such messages! Trade with such SMS will trapped you for long time and after frustrating it may end with huge loss!

What are the charges that can be levied on any trader?

The stock trading involves following charges:

1. Brokerage charged by the broker.
2. Service tax as stipulated.
3. Securities Transaction Tax (STT) as applicable.

Please make note that brokerage, service tax and STT are indicated separately in the Buy/Sell contract note.

What is an Auction (stock)?

If a trader sell any stock and similar quantity is not there in his/her Demat account then auction will take place

The Exchange buys requisite quantity from the Auction Market and gives it to the buying broker. Finally the difference in price indicated in contract note and price received through auction is paid by trader to the Exchange, which is then liable to be recovered from the trader.

Can I buy Gold in form of stock?

Yes,Now NSE & BSE has introduce stock GOLDBEES which is available for trade. 1 unit of GOLDBEES is equal to 1 gm of Gold price

What is a Blue chip stock?

According to the Stock Exchange, a blue chip is stock in a corporation with a national reputation for quality, reliability, and the ability to give profits in good times as well as bad times!

Blue chip stock are called high-quality, popularly accepted for products and services. Blue chip companies are known specially even in downtimes and give good profits in the face of adverse economic conditions, This stock always helps to perform of long record of stable economy and reliable growth rates.

I am a service person, but want to do trading with stock market. May I depends upon my broker ,who can trade on my behalf on their expert recommendations?

We are not agree with you. Kindly involve in trading only if you can track stock market during your service area, if not possible then you should go for Stock portfolio for longer term or invest in Mutual funds or SIP.

What is volatility?

Definition of volatility changes from person to person. We will say that volatility is an uncertainty of price of stock/index. When too much sharp movements in stock/index price in both direction higher and lower then we can say stock/index has become volatile. Such volatile stock or market is always very risky as it can hits any stop loss or targets very easily or even it hits both target and stop loss in very short time. It will be very difficult for trader to judge direction of stock. So a trader must be cautious on such volatile stock/ volatile market, trader can reduce position or trade in small quantity during volatility!

What is Technical Analysis?

Technical analysis is combined study of:
Price: Change in price reflects with demand and supply of stock.
Time: The movements in price is function of time. The long time for a reversal in trend, the greater the price changes.
Volume: The intensity of price changes is depends upon the trade volumes.
Breadth: Study of Breadth of market indicators, the extent to which the price changes can take place in the market in line with overall markets.

How much cash should I maintain while doing trading as well as investments?

To maintain cash is very important in today’s uncertain life. Not only for investment opportunities but cash is also required for immediate needs. We suggest to keep 30/40% of your savings amount as cash! One should add savings and profits to build long term portfolio which is required for Happy retirements!

Which stock should I pick?

A stock with new high of new low We suggest to go for stock with New high. As stock price is not only depends upon supply or demand. But Stock price is knows something that common person not see all the times. It may be change in company management, company business model, growth plan, some triggers indication for future ,demand changes in that particular sector, Fresh FII-DII buying/selling and lots of other such parameters.

I do not have much funds for stock trading, can I borrow money on interest for trading?

We strictly advice to stay away from market if you do not have your own money. Stock market never gives over night gains, but it is slow, steady and boring sometimes! Never expect to make money in one shot. Money on interest always forces a trader to do mistakes and ultimately trader has to exit stock market under burden of interest and huge losses!

What is called Ban period?

A stock goes in Ban period in F&O market when its open contracts (open interest) cross 95% position limit (total allowable contracts). Once in ban period trade is allowed only to reduce/decrease positions, And no other Fresh/ new contracts/fresh positions are allowed during Ban period. Normally volatile stocks more often faced Ban periods!

What is difference between suspended companies and de-listed companies?

Suspended company:
A stoppage in trading of stock/company in NSE or BSE for some time period, when there is a lack of financial information of that stock. Once the stock is suspended, shares of that stock cannot be traded on the market until the suspension is lifted or lapses

De-listed company:
Delisting of company is used in a negative way most of the times, when stock no longer meets the requirements/formalities to be fulfilled on NSE/BSE ,and are removed either voluntarily or involuntarily. However, delisting company means the removal of a listed stock from exchange.

What is put-call ratio? How to use this ratio in trade?

Put call ratio: PCR is put volume /call volume
From given few examples it will be easy to understand PCR
Markets Rises & PCR Rises : If the PCR is rises it means Put volumes is exceeding the Call volumes and market is getting bearish and shorting the stocks & Index. With rising markets we can say that people are selling stocks at highs, profit booking in process and they don't believe in bulls rally for short term.
Markets Rises & PCR Falls : Contrary to the above example, here market believes in the Bull rally and chasing. Market seems to get set for more rises!
Markets Falls & PCR Rises : Increase in PCR along with fall in markets shows the panic. Market may scared and panicking. A sign that short term bearish market is formed.
Markets falls & PCR Falls : Now trend of market is bullish and trader using the market weakness as buying opportunities.