Money Market

  20/4/10 Rule of Thumb for Car Buying Purchasing a car is a significant financial commitment and is sometimes one of the largest expenditures that many individuals will make in their lives. Finding the best approach to fit a car purchase into your budget is critical to ensuring you acquire an affordable set of wheels. When preparing to finance a new car, the 20/4/10 rule of thumb can help you swiftly narrow down your vehicle selections. Here's how the rule works so you can apply it to your personal money, as well as some insight into when it would make sense to change the guidelines to match your circumstances. How Does the 20/4/10 Rule of Thumb  for Car Buying Work? The 20/4/10 rule employs simple algebra to assist car buyers in determining their budget. According to the method, you should put down 20% on a car and finance it for four years, spending no more than 10% of your monthly salary on transportation. The 10% you spend on transportation each month comprises your auto...

  The Moving Average Convergence/Divergence indicator is a momentum oscillator primarily used to trade trends. Although it is an oscillator, it is not typically used to identify over bought or oversold conditions. It appears on the chart as two lines which oscillate without boundaries. The crossover of the two lines give trading signals similar to a two moving average system.   KEY TAKEAWAYS The MACD line is calculated by subtracting the 26-period exponential moving average (EMA) from the 12-period EMA. The MACD signal line is a 9 period EMA of the MACD line. MACD is best used with daily periods, where the traditional settings of 26/12/9 days is the norm. The MACD triggers technical signals when the MACD line crosses above the signal line (to buy) or falls below (to sell) it. MACD can help gauge whether a security is overbought or oversold, alerting traders to the strength of a directional move. MACD can also alert investors to a bull...

  One of the many tenets of future financial planning is investment. To counter inflation and to build a corpus, we invest our money in various financial elements with the idea that our investment will grow gradually like a well-watered plant. There are several facets to investing, with the most popular ones being real estate, gold, public provident funds, and mutual funds. The majority of these investments are low risk and low yield, so there is some guarantee that your money will be safe, but the returns anticipated are also on the lower side. There are other possibilities, however, that are referred to as high risk and high reward investments if you are willing to accept chances with your investment. Simply put, this indicates that you will receive significantly bigger returns at the expense of more risk. FACTORS AFFECTING STOCK MARKET Supply and demand for stock market Interest rates affecting stock market Political factor affecting stock market(War) Current events that af...

  An option is a contract giving the buyer the right, but not the obligation, to buy or sell an underlying asset (a stock or index) at a specific price on or before a certain date (listed options are all for 100 shares of the particular underlying asset). An option is a security, just like a stock or bond, and constitutes a binding contract with strictly defined terms and properties. While it is a little more complex than stock trading, options can help you make relatively larger profits if the price of the security goes up. That’s because you don’t have to pay the full price for the security in an options contract. In the same way, options trading can restrict your losses if the price of the security goes down, which is known as hedging. The right to buy a security is known as ‘Call’, while the right to sell is called ‘Put’. They can be used as: Leverage: Options  trading help you profit from changes in share prices without putting down the full price of the share. You get co...

                                Super Trend is a technical indicator that allows you to identify trends and provides you with both buy and sell signals. It may be applied across different timeframes (i.e. 5 minutes, hourly, daily), although you may note that a smaller timeframe may lead to a higher frequency of signals being generated. It usually alternates between two colors: green or red, indicating whether the trend is tilted to the upside or downside respectively. A buy signal is generated when the Super Trend is plotted below the closing price and the color switches from red to green. Conversely, a sell signal is generated when the Super Trend is plotted above the closing price and the color switches from green to red. Conclusion : The downside is, a super-trend indicator is more useful in trending markets where there are clear uptrends and downtrends in price. It...

  Volume-weighted average price, or VWAP, is a technical analysis tool that displays the relationship between an asset's price and its total volume of trades. It gives investors and traders a gauge of the typical price at which a stock is traded over a predetermined time frame. Investors who choose to be more passive in the market—typically pension funds and mutual funds—as well as traders who want to know whether a stock was purchased or sold at a fair price—often use VWAP as a benchmark. To calculate VWAP, you use the following equation: VWAP = ∑(amount of asset bought x asset price)/total shares bought that day The standard VWAP is calculated using all of the orders of a given trading day, but it can also be used to look at multiple time frames. The VWAP ratio is then presented on a chart as a line. It has been likened to a moving average, in that when the price is above the VWAP line the market is seen as in an uptrend, and when the price is below the VWAP the market is in a do...

                                   The relative strength index is abbreviated as RSI. It is a critical instrument in technical analysis, measuring the momentum of assets to determine if they are overbought or oversold. To calculate RSI, use the following formula: RSI = 100 - 100/(1 + (average up closes/average down closes)) The RSI computation yields a value between 0 and 100. Most analysts feel that an asset nearing 70 is overbought and may be due for a correction, whereas an asset nearing 30 is oversold and may be due for a rise.  RSI example calculation Let’s say that over the past month, Asian Paint has finished up an average of 5 points and down an average of 10. Divide 5/10 to make 0.5, then add one to make 1.5. Divide 100 by that number to make 66.66, then minus that from 100. In this example, the current RSI of Asian Paint is 33.34.

  The Reserve Bank of India (RBI) is India’s central bank, also known as the banker’s bank. The RBI controls the monetary and other banking policies of the Indian government. What are the major functions of the RBI?   The preamble of the RBI says... "to regulate the issue of Bank notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage; to have a modern monetary policy framework to meet the challenge of an increasingly complex economy, to maintain price stability while keeping in mind the objective of growth." Some of the basic functions of the RBI are:   1. Issuer of notes: The RBI is the only institution which has the control over printing of currency notes (except the one rupee note, which is printed by the finance ministry).   2. Banker to the government: The RBI performs banking functions for the state and central governments. It advises the governmen...

  The Federal Reserve System (FRS) is the United States' central bank. It is perhaps the most powerful financial institution in the world, and is commonly referred to as the Fed. It was established to provide the country with a secure, adaptable, and stable financial and monetary system. The Fed is governed by a seven-member board of directors. There are additional 12 Federal Reserve banks, each with its own president who represents a different district. Key TakeAways. The Federal Reserve System is the central bank and monetary authority of the United States. The Fed provides the country with a safe, flexible, and stable monetary and financial system. The Federal Reserve System is composed of 12 regional Federal Reserve Banks that are each responsible for a specific geographic area of the U.S. 1 The Fed's main duties include conducting national monetary policy, supervising and regulating banks, maintaining financial stability, and providing banking services. The Federal Open Ma...

                                                                     Major Global Indices

                    Trading Holidays For Equity (NSE & BSE) Trading Holidays for Commodity(MCX/NCDEX)

  Market sentiment represents the mood of financial markets and the general feeling among traders, whether they trade foreign exchange, the stock market or anything else. Understanding sentiment allows you to judge whether a market is feeling optimistic or pessimistic about the future of prices of a security, such as a stock or currency, for example. If the market is feeling positive and optimistic about the outlook then this is referred to as bull market, and a pessimistic market that expects prices to fall is referred to as a bear market. Gauging market sentiment, however, is tricky. Attitudes and the outlook of a market are both shaped by anything and everything, therefore investors need to spread a wide net to ensure they are informed as much as possible about the ever-evolving market they trade. In addition, while most of the market will lean one way or another, every participant holds their own view on why the market is performing the way it is and where it is heading n...

  A commodity is a basic good used in commerce that is interchangeable with other goods of the same type. Commodities are frequently utilized as inputs in the manufacture of other commodities or services. Thus, a commodity is typically defined as raw materials used in the production of completed items. A product, on the other hand, is the finished item that is sold to customers Hard commodities refer to energy and metals products while soft commodities are often agricultural goods.   Hard commodities are usually classified as those that are mined or extracted from the earth. These can include metals, ore, and petroleum (energy) products. Soft commodities instead refer to those that are grown, such as agricultural products. These include wheat, cotton, coffee, sugar, and soybeans, among others.                                     ...