Archive for the 'Uncategorized' Category

05
Jul
14

MCX is still a hold..

Couple of months back I had written about MCX being a good contra buy (https://writingoptions.wordpress.com/2014/05/09/mcx-good-contra-buy/). Friday closing price of MCX on NSE was 670.

Is it time to book profit ? I don’t think so and I am still holding every single share in my investment book. I had bought few shares in trading book around 520-550 which I sold at current price. Other way round, Is MCX a buy around current prices ? I would hesitate to buy at current prices and would prefer to do so on declines. Although it’s a different question, whether one would get a sharp decline now. There was a news report recently that Kotak might prefer to buy MCX shares from open market rather than buying stake from FT. I don’t know if it is true or not, but if it is than it might provide further support to MCX share price. Corporation bank has also completely sold its MCX stake. It held 1.77 percent stake as on 31st March, 2014. Along with Corporation Bank one more public sector bank, Bank of Baroda has also sold its entire stake in MCX.

There is still no news on the stake sale of FT’s 26 percent stake. I hope clarity emerges on this front shortly and it gets done quickly. New promoter might be able to focus on improving trading volumes at MCX. But as I said in my last post on MCX, biggest trigger for MCX remains amendment to FCRA.

Disclaimer: These are my personal views and you should do your own due diligence before acting on anything written in this blog. Please take reasonable care while trading in options, especially while selling. I am not advising anyone to sell or buy options. My purpose of writing this blog is to highlight my trading strategies

11
May
14

NSE buys 5 percent more into NCDEX..

Shree Renuka Sugars pared down its 7.5 percent stake in NCDEX from 12.5 percent to 5 percent. Total sale amount which sugar company received for NCDEX was Rs 66.54 crore. With this stake sale, India’s second largest commodity exchange, NCDEX has been valued at 887.2 crore. Important thing to note in this stake sale was that NSE bought 5 percent into the commodity exchange. With recently changed FMC guidelines about shareholding of commodity exchange, stock exchange can hold up to 15 percent. NCDEX stake buy gives NSE hold in the commodity space.

In my previous post I had written about MCX being a good contra buy (https://writingoptions.wordpress.com/2014/05/09/mcx-good-contra-buy/). MCX holds close to 85 percent market share versus 14-15 percent market share of NCDEX. MCX holds cash & cash equivalents of 1200-1300 crore and zero debt. There are few concerns about potential liabilities in terms tax penalty and listing agreement violations. But despite all these concerns, MCX remains a great buy and NCDEX stake confirms my belief about value in it. I think BSE might be interested in buying into MCX.

Disclaimer: These are my personal views and you should do your own due diligence before acting on anything written in this blog. Please take reasonable care while trading in options, especially while selling. I am not advising anyone to sell or buy options. My purpose of writing this blog is to highlight my trading strategies

09
May
14

Squared off Nifty Strangles

What an unexpected up move it was today !! It was a trailer of up move which we might see on 16th May if NDA gets 270 seats. In my previous post I had mentioned about buying into Nifty strangles (https://writingoptions.wordpress.com/2014/05/06/update-election-strategy-on-nifty/). IV’s at that time were around 34-35, but with today’s up move they have shot up to 44-45. I thought it was prudent to square off Nifty strangles with current IV’s. Nifty is factoring in up move of 9-10% on D-day.

I haven’t squared off my bull call spread & bear put spread on Nifty (https://writingoptions.wordpress.com/2014/05/02/election-strategy-for-nifty/). I will continue with this position till election results.

Disclaimer: These are my personal views and you should do your own due diligence before acting on anything written in this blog. Please take reasonable care while trading in options, especially while selling. I am not advising anyone to sell or buy options. My purpose of writing this blog is to highlight my trading strategies.




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