Analysis with Shaurya

You may have heard a lot of people nowadays saying that " be cautious, the market is about to crash", but the truth is that anything without research in the stock market is gambling. It's just like betting over an IPL match. So in this article I will try to explain what I feel regarding the markets after doing my research. I will also make it clear on what basis I feel so. I will divide the explanation regarding whether market will crash or not in two parts: Fundamental Overview & Technical Overview A) Fundamental Overview In the short term Markets may move due to sentiments of traders but in the long run, market prices are a reflection of the earnings of companies. So one of the best ways to analyze whether the market is expensive or not is the PE ratio. The PE ratio is derived by dividing the market price of a company by its earnings per share (EPS). Here we are analyzing the Nifty Index, which constitutes the top 50 companies of India registered on the National Sto

INTRODUCTION  We often hear about credit cards. Some of us believe that credit cards are really good as they help us to buy even those goods which are quite costly and we can't afford to pay its price in cash at present. However many people think that credit cards are like a trap where they will get trapped by high interest charges. By the end of this article it will be very clear to you whether the credit cards are a trap or a help for you. How does it work ?  Whenever you will approach a bank or any financial institution which is issuing credit cards, they will tell you the limit up-to which you can buy goods and pay for services and also the interest rate which they will be charging from you for the amount which you owe to them provided if you don’t pay the monthly bill of your credit card. If you are able to pay your monthly bill or credit card then you don’t have to pay any interest on it. But if you aren’t able to pay your bill then interest will be charged on a daily basis

INTRODUCTION  Inflation or “ mehengaai “, one of the most discussed topics between all of us. It measures how much prices are increased on an average.Inflation is measured at producer level as well as consumer level. CPI measures the retail inflation, which means that CPI measures average changes in prices of goods which a consumer is paying. WPI ( wholesale price index) measures inflation at producer level which means that it measures average changes in prices of goods which a producer is paying. In this article we will discuss various aspects about Consumer Price Index. CALCULATION  The calculation of consumer price index is divided into 5 steps. Selection of Goods  In the first step economists try to find out those goods which consumers are buying frequently. And accordingly they assign weightage to the goods. This weightage of goods is dependent on how frequently people in an economy are buying those goods.  In this way the Economist tries to fix a set of goods with different weigh

GDP GDP or gross domestic product measures the value of goods and services produced in an economy. GDP is calculated quarterly. It is the total expenditures on final goods and services produced in an economy in a period of time. It also measures total revenue generated in an economy. You might think that how is it possible that a single measurement is measuring both revenue and expenditure. But it's true, as for the economy as a whole, total revenue is equal to total expenditure. It is because if you buy a product you pay for it, and the one who is selling you also belongs to the same country. Now you may think that what if we buy a foreign product. We will discuss this when we will calculate GDP. CALCULATION OF GDP GDP = C + I + G + ( X-M) where, C = private consumption expenditure.  It includes expenditures on all goods and services which are done by people in an economy but it does not include housing purchases. We add housing purchase in the investment section. I = Investments.

HOW DO STOCK PRICES MOVE ?  The main reason for the increase and decrease in prices of a stock are the market forces. The supply and demand factor leads to increase  and decrease in the stock prices. If the demand is greater than supply the price moves up and if the supply is greater than demand price goes down. So what is that element which  leads to movement of supply and demand forces? If there is any news or information which is beneficial for the company more traders will like to purchase shares of that company and the existing shareholders will like to hold the shares  hence this leads to increase in demand and decrease in supply, and the price of the stock goes up. Similarly if there is any news or information which is not  beneficial for the company traders will not like to purchase shares of that company and the existing shareholders will also like to sell the shares  hence this leads to increase in supply and decrease in demand, and the price of the stock goes

GLOBAL FINANCIAL CRISIS-2008 The financial crisis of 2008 commenced in the USA but the whole world witnessed the crisis.  COMMENCEMENT - 2001 The commencement of the global financial crisis has its roots connected to 2001 when the Federal bank of USA reduced the interest rate from 6.5% to 2.5% in 2001. This led to a gradual increase in borrowings. The easy availability of credit incentivised people to borrow loans and purchase homes. This led to an increase in home prices.  All this started forming a real estate bubble. Even after witnessing the massive increase in real estate prices and borrowings, the federal bank reduced the interest rate to 1% in 2003.  THE FINAL CALL   From 2004, there was a sharp increase in interest rates in the USA. From 2004  fed rates had reached 5.25%which continued till 2007, following this the home prices started declining. Borrowers  were not able to pay the  interest, and many sub prime lenders had to file for bankruptcy.  The