Ranjeet Walunj

September 23, 2008

Indian market tommorow post $25 spike in crude oil prices

I was awake pretty late today and checking yahoo finance site for the global market cues for tomorrows (23 sep 2008) market in India.

Crude oil prices have taken biggest one day jump ever till date; when it spiked more than $25 today in US market.
However it has cooled down to $120.92 from the earlier $130 today. (which is still up by $16)

Yahoo finance says, it is because of an anxiety over the government’s $700 billion bailout plan battering the dollar and creating buying interest in safe investments including crude.

So how will it affect Indian market tomorrow, are we heading for another fall ?

I’ve failed to understand why Indian markets were going down when Indian economy is not doing so bad + Oil prices were going down (barring last 3-4 days) + nuclear power deal is signed off. (I mean lot of positive indications)

Probably thats how the Bearish market treats lot of positive signs just in the same manner Bullish market ignore the negative signs.
(nobody was asking why questions when sensex was rallying to +21000)

September 11, 2008

Technology glitch brings UAL stock down

I was going through slashdot and one bizzare incident was reported on it.

Google’s news tracker/crawler, fetched a news from some old reprint of an article from Dec 2002 when United Airlines was on the verge of bankruptcy.

United airlines later on managed to get out of the situation after that.

However google crawled it as latest news since the reprint did not mentioned about any of the date.

Soon every other news reader/aggregators grabbed this incorrect information from google’s news and soon started spreading this news across market.

After some time this news appeared on Bloomberg and the stock price of UAL dropped to $3.00 from the opening price of $12.50. Trading was suspended after that.

And after clearing the doubts stock prices rose back to around $10.00 which is still lesser than the actual opening price.

UAL 8 sep 2008 fiasco due to incorrect news

UAL 8 sep 2008 fiasco due to incorrect news (Source yahoo finance)

Google cannot be blamed for this mistake. But some people might have jumped the gun as soon as the news appeared on Bloomberg and started selling off their stock. People should get into a habit of checking news and then taking financial decisions.
Thought the incident clearly shows the power of internet in todays world.

Few smart people would have made money after checking the authenticity of the news and riding on the fall or rise 🙂

How does it affect any other market ?

I was wondering whether these features can be manipulated to rigg stock prices up and down ?

If someone creates a news site where he artificially creates/modifies/brings older news back to current threads about certain stocks where he wants to manipulate for his benefits.

That opens another possible rigging opportunity for operators/manipulators in market.

Or to avoid these kind of situation should news crawlers try not to crawl news without timestamps ?
Or should there be a need for moderators before news gets published/indexed by crawlers ?

We all know that there are other ways of manipulation in stock markets and we seriously do not wish to add another possibility of manipulation.

References:

Slashdot news : Automated news crawling evaporates $1.14B

Wallstreet:   UAL story blame is placed on computer

Atlanta business chronicle : Google crawler, clicks may have pushed 2002 UAL bankruptcy story to top

August 12, 2008

Disappointing June IIP at 5.4% …Stock market ends weak

I was talking to wise friend of mine from finance sector and he told me why the market went down today.

It all started first with CNBC reporting IIP (Index of Industrial Production) at some 3.4% and the market entered the panic mode and lots of Nifty lots were sold in that period.

That was an error on CNBC part as incorrectly reporting “Growth in six key infra industries (which is 3.4%)” data as IIP numbers.

Whereas the actual number was released later which was at 5.4%.

However the damage was already done.

Although the numbers are not good but it is not as bad as 3.4%.

CNBC must have corrected that immediately but traders following CNBC, shorted many lots to create more panic.
All these things happen when you try to push news faster than your competitors.

I like CNBC for its fundamental analysis of the conditions/companies. However I do not follow their recommendations. It always pays to do your own research and then invest.

Long term investors in my opinion should not worry as it does not make much difference when you are looking at the horizon of +5 years.

Traders do like volatility in market and they will be more than happy to ride the waves.

I’m short on money otherwise I would go ahead and invest in good solid scrips. (for long term)

August 4, 2008

Financial Resolutions Revisited….

Filed under: Finance, general — Tags: , , , , , — ranjeetwalunj @ 5:55 pm

I know its bit late to follow any of the resolutions.Yeah i know its august 2008 and not yet the new year.
But i’m as usual lazy and late 🙂

Nevertheless i’ve read following resolutions in the month of Jan and put it down for my referrence.
(Seriously dont remember from which portal. Would love to provide link if anyone comes across these.)

Resolutions are as follows:

  1. I will not keep more than one month’s salary in my savings account.
    I’ve managed to do that till now … thanks to my spending 😉
  2. I will not invest in insurance to save tax
    Insurance — savings ?? ….WTF is this ? …have TERM insurance … and thats it …. All other insurance products in my opinion are sheer waste …. nothing else …
  3. I will not invest in a new fund unless it offers something different and better
    People who cannot track market should go with Mutual funds …. So far having very little budget allocated to Mutual Funds ….. But I always look at 5 or 10 years horizon ….. and always opt for full equity/growth ….
  4. I will buy health insurance for my family.
    Company has provided some insurance … need to do this on my own …. very important
  5. I will not roll over my credit card bills.
    huh …… havenot been able to do that …. thanks to the increased credit limits provided by ICICI and citibank …….. need to get organised here. ……. will clear everything in this week ..
  6. I will not get caught in the ‘Rush of March’
    Seriously …. every year march is the most stressfull month …… i’m putting all the re-imbursement claims every quarter …… just need to get more organised and manage the bills properly.
  7. I will pay attention to allocation of my savings
    Savings ??? ….. will do when i get it 🙂
  8. I will check all my bills for discrepancies and incorrect charges.
    I’ve been doing this … since i dont know from when …… full on Kanjoos + Khadoos ….. Native places (Pune) has left these virtues(?) long back….
  9. I will put at least 10% of my income in retirement planning
    Haven’t yet figured out …. the kind of returns promised by these retirement planning plans are so fucked up that it does not make any sense to go with it.
    Better option is to invest in good quality scrips at every dip …. probably they will provide better returns post your retirements.
  10. I will write down my financial goals once a year.
    Ha. atleast this makes it twice the year …… cool …

I’m assuming i’ll try to provide better attention to the above goals.

July 30, 2008

Finance Guru Speaks ….

Filed under: Finance — Tags: , , , — ranjeetwalunj @ 5:53 am

I’ve been associated with AIII (Association of Indian Individual Investors) for almost 3 years now.

This group has been started by Rajeev Mundra
(Too cool guy from IITK — GeoDesic — and now full time finance guru )

And the kind of financial input/training/gyan recieved from the group is amazing.

Received following gem from Padmanabhan:

———————————————————————————–

Was discussing with my mentor these important concepts of money which are often not really understood.
He even analysed why many commonly held truths about managing money are obsolete.

“Investing,” he points out, “is not risky, but following bad investment advice is.

  • Your future is created by what you do today, not tomorrow
  • The size of your success is measured by the strength of your desire; the size of your dream; and how you handle disappointment along the way.
  • The only difference between a rich person and poor person is how they use their time
  • Academic qualifications are important and so is financial education. They’re both important and schools are forgetting one of them.
  • The poor, the unsuccessful, the unhappy, the unhealthy are the ones who use the word tomorrow the most
  • I have a problem with too much money. I can’t reinvest it fast enough, and because I reinvest it, more money comes in. Yes, the rich do get richer.
  • Do today what you want for your tomorrows
  • Tomorrows only exist in the minds of dreamers and losers
  • The most life-destroying word of all is the word tomorrow
  • A lot of people are afraid to tell the truth, to say no. That’s where toughness comes into play. Toughness is not being a bully. It’s having backbone.
  • Money is kind of a base subject. Like water, food, air and housing, it affects everything, yet for some reason the world of academics thinks it’s a subject below their social standing
  • We go to school to learn to work hard for money. After earning the money and spending it we rarely spend time to learn the skills to protect/grow it.

————————————————————————————–

The concepts/thoughts are really simple. But putting them in one neat manner takes an effort.

Thanks paddy for this gem.

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