Wise Investing

Hello friends  Did you realize that a one-lakh rupee investment in Nifty last year would today be worth Rs 99,000? That's precise. The latest sell-off in global shares has shattered all of Nifty's year-to-date gains. Despite a minor improvement in May, retail inflation remains significantly above the Reserve Bank of India's (RBI) tolerance ceiling of 6%. A twin whammy of rising commodity prices, particularly for oil, and a record-low Rupee has only exacerbated the situation. Experts believe that the RBI would raise interest rates even higher to keep inflation under control, which would be a tremendous disadvantage. The United States is facing the same issue but on a much larger scale! The short-term US 2-year Treasury yield surpassed 3% for the first time since the Global Financial Crisis of 2007. Rising short-term rates reflect sour long-term market sentiment, implying that investors are losing faith in the US market's prospects. This is a traditional indication of a r...

  The Most Profitable Business on Earth Today! If you are thinking it’s lithium mining, then you are wrong. It’s the oil refining business that is minting a crazy amount of profits today! Let us understand! What are 3-2-1 crack spreads? The crude oil is refined into different products like gasoline, fuel oil, diesel, etc. by the refining companies. It’s these end products that we use in our daily lives. To evaluate the profitability of the refining business, analysts calculate 3-2-1 crack spreads. These are calculated as: 1) Buying 3 barrels of crude oil 2) Selling 2 barrels of gasoline 3) Selling 1 barrel of fuel oil The higher the spreads, the more profitable the refining business. What has happened to the 3-2-1 crack spreads? Lately, the 3-2-1 crack spreads have skyrocketed to all-time high levels of $55-60 even though the crude oil has been in a tight range of $100-$120. What are the reasons for the rising spread? Market participants say that multiple shutdowns o...

 Hello friends  Yet another interesting topic for you  PRICE OPEN INTEREST INTERPRETATION Increase in Price Increase in OI Indication of new money coming and indicates the further continuance of uptrend Increase in Price Decrease in OI The increase in price is due to short covering of positions Decrease in Price Increase in OI The decrease in price is due to newly built short positions and further weakness is predicted Decrease in Price Decrease in OI Traders unwinding their long positions by selling existing contracts Option Chain Nifty – Interpretation of Open Interest: How to interpret “Nifty Option Chain: Open Interest | Put Call Ratio Tracker”? In Summary: High PCR means the market is bullish because the option writers are inclined to write puts. Low PCR means bearish sentiment – because option writers are not willing to write puts but instead write calls. The put-call ratio (PCR) is a popular tool specifically designed to gauge the overall sentiment (mood) of the ma...

Hello friends I hope you all are doing well yet another interesting topic  How to save your portfolio against the falling rupee? The Indian rupee has depreciated nearly 4% this year. While the overall impact of a weaker rupee is negative on the equity market, some sectors stand to benefit from this fall  The Reserve Bank of India’s rate hike in May, in order to be in line with the global market sentiment, has pushed the domestic currency to record low levels. The rupee has skidded over 2 percent against the US dollar in May, seeing its worst monthly decline in 2022. In comparison, the S&P Sensex and Nifty 50 tanked over 3 percent each during the period. Weak economic data, rising interest rates, soaring inflation, and the exit of foreign investors are some of the key triggers behind the rupee’s meltdown.  That is because a depreciating rupee does not bode well for foreign investors as returns reduce from Indian investments, prompting their departure. According to data...

Hello everyone it's important to  save when you have earned big  Tax loss harvesting is a tax-saving measure where taxpayers can reap benefit from underperforming stocks long-term capital gains are subject to tax, here I am with a huge tax burden this year. You might have some ‘dud’ stocks in your portfolio and these stocks can possibly never get back to the price at which you bought, let alone make money for you. Now is the time to use such loss-making stocks. So this year, when you’ve incurred capital gains, especially long-term capital gains, it will be a good idea to get rid of these dud scripts and utilise the capital loss to reduce the tax liability. This way of reaping benefit from underperforming stocks is called tax loss harvesting. when investors are able to estimate that even in the next assessment year, their capital gains may be high, it’s a common practice to buy back or repurchase the shares sold. This way you are creating a buffer for loss harvesting. Essential...

Hello everyone  Hear is something  that every trader wants to know that indicates reversal in trend A double top pattern is formed from two consecutive rounding tops. The first rounding top forms an upside-down ‘U’ pattern. Rounding tops can often be an indicator for a bearish reversal, as they often occur after an extended bullish rally. If a double top occurs, the second rounded top will usually be slightly below the first rounded tops peak indicating resistance and exhaustion. Their formation suggests that investors are seeking to obtain final profits from a longer bullish trend.  Below Image for more clear view  Double bottom patterns, on the other hand, are essentially the opposite of double top patterns. A double bottom is formed following a single rounding bottom pattern which can also be the first sign of a potential reversal. Rounding bottom patterns will typically occur at the end of an extended bearish trend. After a double bottom, common trading strateg...

 (Q1) How much crude does India consume? India is the 3rd largest consumer of Oil at 5.35 million barrels per day (MBPD) behind US (21.2mbpd) and China (15.1mbpd) India imports nearly 85% of its total Crude oil consumption every year.  India's own production has been below 700,000 barrels per day for a long time. (Q2) Where does India import the balance requirement from? India imports oil in the following share as per FY 21 numbers:  Iraq 17%,  Saudi Arabia 16%,  UAE 14%,  USA 9%,  Qatar 8%,  Others 38% India import share for Oil from Russia is under 2%, an insignificant number. (Q3) How does India's Oil trade deficit look like? Definition: Oil imports - Oil Exports = Oil trade deficit  India imports about 290 Million tones of Oil in a year.  Assuming that Oil prices are at $75 (last year), India's oil import bill is ~ $165bn (290m * $75) India exports refined petroleum products as well. At $75 oil price those exports would amount to $58...