[shajufx]

Originally Posted by spookey

Hi Shajufx ,
I started trading for a living since July 2013. I only trade in NSE stock futures and write options and dont do delivery based trading. My Annual returns (not compounded) were:
In Fy 2013-14 = 19 % , Fy 2015-16= 34 % , Current Fy 2015-16= 83 % so far. I prefer shorting stocks and write options.

Thanks for the input, although its very low figures compared to forex, I am curious on the number of hours per day spent for the same. That would make a reasonable comparison.

[sukhoi]

Originally Posted by sukhoi

Fellow boarders, in recent times I have been reading about dividend growth investing strategy and that has appealed to me so far. A good site to learn about this could be http://dailytradealert.com/dave-van-...sting-lessons/. I came across this when I stumbled upon the blog of Jason @ http://www.dividendmantra.com/. This guy writes about his portfolio, incomes and expenses and how his earnings from the market (in form of dividends) are growing over a period of time. Any one here follow this strategy.

Given the current fall we have in the market, wherein some people are talking about this being a repeat of 2008, it appears to be a good time to for long term investors to invest in quality stocks which are available at much lower prices.

Keeping in mind the dividend growth investing strategy which I had referred to some time back, I identified a list of few stocks which should be good candidates. These are:

1. Oil India
2. Coal India
3. Rural Electrification Corporation
4. Power Finance Corporation
5. Infosys
6. Karnataka Bank

All of the above have a dividend yield of 5% or above at current prices and have been growing the dividend payout also.

Originally Posted by J.Ravi

Long-term outlook of these two companies is good with good capital growth. Both have excellent dividend history. One is a government enterprise, while the other is a well-adminsitered private sector bank. The present dividend yield of OIL is 5.34% and that of Karnataka Bank is 4.62%, according to Money Control. They are less volatile, thereby reducing the risk. So, whenever there is a dip in the market, I buy these shares purely for long-term investment. Even if the maket does not recover, I can enjoy the regular tax-free good dividend!

Precisely the reason why I like this approach of dividend growth investing.

Views from the community on whether the above stocks are a good candidate or not? Any one investing in any/all of these and has views/opinions, please share.
Disclosure: Have currently invested in Coal, REC, PFC, Infosys. Others, would add in days to come.

Cheers,
S

[Saanil]

Originally Posted by sukhoi

1. Oil India
2. Coal India
3. Rural Electrification Corporation
4. Power Finance Corporation
5. Infosys
6. Karnataka Bank

1. Oil India
2. Coal India

Since government has been trying to plug its fiscal deficit, these companies might announce a dividend irrespective of the sector specific issues which is not particularly good for minority shareholders. That said, Coal India seems to be a safe candidate - though I am not sure why its stock price is falling?

I tried searching for a reason and came up with the following: drop in coal prices, lower demand due to China, fall in e-auction prices. I might wait for its 3Q16 results and then take a call. But in my opinion, the downside from these levels is pretty limited.

1. Rural Electrification Corporation
2. Power Finance Corporation

Not a huge fan of the power sector, hence no views here.

1. Infosys
2. Karnataka Bank

Off late, I am hearing pretty bearish views on PSU banks. Just stay away from those for now - thats my only view regarding banks

[sukhoi]

Originally Posted by Saanil

Since government has been trying to plug its fiscal deficit, these companies might announce a dividend irrespective of the sector specific issues which is not particularly good for minority shareholders. That said, Coal India seems to be a safe candidate - though I am not sure why its stock price is falling?

I tried searching for a reason and came up with the following: drop in coal prices, lower demand due to China, fall in e-auction prices. I might wait for its 3Q16 results and then take a call. But in my opinion, the downside from these levels is pretty limited.

Thanks for your inputs Saanil. Maybe a dumb question but why is dividend not good for minority shareholders? Dividend would be paid out to everyone equally. Or do we mean that since dividend is paid out, government coffers would fill up with cash which could have been utilized for expanding/growing the business?
There were few articles about government suggesting that Coal India give a good dividend and also maybe a bonus but not confirmed news yet.

Originally Posted by Saanil

Off late, I am hearing pretty bearish views on PSU banks. Just stay away from those for now - thats my only view regarding banks

Karnataka bank is actually a private bank and not a PSU. I was also not aware of this till I read fellow BHPian, J. Ravi's post wherein he mentioned that it is a privately held bank.

Cheers,
S

[spookey]

Originally Posted by shajufx

I am curious on the number of hours per day spent for the same. That would make a reasonable comparison.

Hi Shajufx , That really depends on person to person. I personally put in 10 - 12 hours everyday but thats because i love to not because i have to. For intraday positions you have to spend minimum 6.5 exchange trading hours or until you square off your position and 2 hours for EOD analysis and to draw next days action plan , for positional trades you just have to watch ticker once in a while in those 6.5 exchange trading hours.

[shajufx]

Originally Posted by spookey

..I personally put in 10 - 12 hours everyday but thats because i love to not because i have to....

Thats good to know. Same here, I spent around 10 hours on the forex part anyway. So, are you a fundamental or technical trader ? I have seen few paid charts used by few, not sure how helpful they are in deciding trades !

[Saanil]

Originally Posted by sukhoi

Thanks for your inputs Saanil. Maybe a dumb question but why is dividend not good for minority shareholders? Dividend would be paid out to everyone equally. Or do we mean that since dividend is paid out, government coffers would fill up with cash which could have been utilized for expanding/growing the business?
There were few articles about government suggesting that Coal India give a good dividend and also maybe a bonus but not confirmed news yet.

Dividend should be paid keeping into context the future needs of the business. Paying a higher dividend (just because the government need to shore up their revenues) while not taking into account the future business needs is not good for minority shareholders. I am not saying that the future business is bad - I am just saying that the major shareholders getting greedy in the short term while harming the core business is not good (not that this is happening in Coal India)

There have been reports now that Coal India may decide to do a share buyback.

[fordday]

Originally Posted by Saanil

1. Oil India
2. Coal India

Since government has been trying to plug its fiscal deficit, these companies might announce a dividend irrespective of the sector specific issues which is not particularly good for minority shareholders. That said, Coal India seems to be a safe candidate - though I am not sure why its stock price is falling?

I tried searching for a reason and came up with the following: drop in coal prices, lower demand due to China, fall in e-auction prices. I might wait for its 3Q16 results and then take a call. But in my opinion, the downside from these levels is pretty limited.

Correct. Govt is nudging these PSUs like OIL to go on paying dividends irrespective of its balance sheet colour. This is not good in the long run. We will end up like Indian Railways which during Lalu time looked so rosy that nothing could go wrong. And now we could see, for all his wrong decisions of overloading IR without adequate increase in revenues it ended up with a severe cash crunch and in dire need of infrastructure upgrade. With a dividend focus strategy, it will cause more loss as time passes or regime changes.

As for Coal India, I saw the news recently that Govt. is opening up coal mining to private players. This means the end of monopoly for CI. If the MNCs move in with their money bags and streamlined processes in coal mining, our CI will have a lot of catch up to do. Only two days ago saw the news that CI is revamping itself up by fitting GPS in its trucks and putting up electric fencing around its mines.

Fordday.

[manduvindupondu]

Lovely. If the news that Coal blocks are to be opened for private companies, it is music. Let competition prevail and not the monopoly/crony capitalism.
Hope the news is true and it materializes soon.
Next in line is the APMC act to be scrapped across states. Of course, it is a state specific subject.

[manduvindupondu]

I am a satisfied Zerodha customer. I hold a Ventura1 account too, which is also pretty good. I held an ICICI direct account earlier in 2009. Multiple issues with ICICI bank forced me to close all relationship with them.
Ventura provides capability to invest in IPOs, mutual funds, NCDs, Bonds etc which Zerodha currently lacks, but are working to bring in future.

Zerodha is doing their part by making delivery free.
SEBI/Gov should do its part by tracking down on scams like Pyramid Saimira, GTL etc.
It should lower the STT - Securities transaction tax (0.1% currently)
I now invest only in Nifty 50 and a select list of bluechips, after having burnt my fingers.
I trade in equity options, currency options, gold etfs. Never in Futures.
Any idea of silver etfs?

Stock market quote:
If you enter the market with experience, you earn money.
If you enter with money, you earn experience :-)

Experienced both, during my interaction with the markets since 2006.
Any other investment avenues in the stock markets are welcome.
Options strategies is an interesting topic. Would anyone love to discuss their ideas? Feel free to pitch in.

[spookey]

Originally Posted by shajufx

Thats good to know. Same here, I spent around 10 hours on the forex part anyway. So, are you a fundamental or technical trader ? I have seen few paid charts used by few, not sure how helpful they are in deciding trades !

Hi Shajufx , I use both fundamentals and technicals but of late due to prominence of algos used by prominent market operators in our markets both doesnt work these days. So I use a combination of fundamentals , techincals and Calls & Puts & Futures OI. To the best of my knowledge paid charts are of no use .My strategy is simple - Identify fundamentally weak stocks that are technically strong but heavy call writing happening and short them and vice versa. The truth is unlike Forex markets our Equity markets are rigged big time with stock specific bull & bear traps in place.

[Saanil]

Originally Posted by fordday

Fordday.

Originally Posted by manduvindupondu

crapped across states. Of course, it is a state specific subject.

Sorry but a stupid question from my side - is Coal India the only company in India which is allowed to do coal mining? I mean is this situation mandated by law? If that is the case, allowing new/private companies to enter coal mining should be a big negative for Coal India right?

If new players are to enter, they would have to buy coal mines? But I assume Coal India must be owning most of the coal mines right? Are companies not even allowed to test land/grounds for potential coal discovery?

Sorry for asking such basic questions. Before I take any decision, I think it will be good for me to know such things rather than revenue growth/margins etc.

Would appreciate views from people who are experts here!

[manduvindupondu]

1) Yes, Coal India has a virtual monopoly. Minor captive units exist for Tata Steel, but very insignificant.
2) APMC (Agricultural Produce Marketing Committee) is under the purview of the states. It basically means farmers cant sell to whomsoever he wants. He should sell to a middleman (the APMC), who fixes the price. Loss for the end customer, farmer due to limited options.
Scrapping APMC is a progressive step and eliminates the un-necessary middlemen.
Hope some states scrap it.

[fordday]

Originally Posted by manduvindupondu

2) APMC (Agricultural Produce Marketing Committee) is under the purview of the states. It basically means farmers cant sell to whomsoever he wants. He should sell to a middleman (the APMC), who fixes the price. Loss for the end customer, farmer due to limited options.
Scrapping APMC is a progressive step and eliminates the un-necessary middlemen.

Correct. Govt. created the APMC with the stated motive to support the farmers, with a minimum support price, who are otherwise duped by middlemen by offering them very less prices. But govt also inserted the clause in bold above. In course of time, APMC itself became the monster which it was supposed to destroy (the middlemen).

This reminded of a story I heard somewhere about how the sugar mills in India work.

The sugar mills buy sugarcane from the farmers at govt recommended price and make sugar and sell it to the market or govt for Public Distribution System. The farmers may or may not be making much profits. But there are always distressing news about crop loss, farmer suicides etc etc.

One day the govt comes out with a notification saying that these sugar mills are exploiting the cane farmers so the govt is buying the mill and will operate it. The catch here is govt will buy the, say Rs 100 worth, mill at Rs 150. The mill owner made a 50% profit here.

After few years the govt will come up with a notification again that it is not govt's job to run sugar mills. Mills should be auctioned off. The same mill is now sold off to the same old owner at Rs 50. So the owner made a neat 100% profit in few years.

This cycle repeats itself every few years. You can assume here that the same person (politician) or his family will be the mill owner and well as the decision maker in the govt.

Not sure how true it is, but the way the things are in our land, I won't be surprised if it is 100% true.

Fordday.

[JMaruru]

Originally Posted by fordday

After few years the govt will come up with a notification again that it is not govt's job to run sugar mills. Mills should be auctioned off. The same mill is now sold off to the same old owner at Rs 50. So the owner made a neat 100% profit in few years.

This cycle repeats itself every few years. You can assume here that the same person (politician) or his family will be the mill owner and well as the decision maker in the govt.

Not sure how true it is, but the way the things are in our land, I won't be surprised if it is 100% true.

Fordday.

It is like the saying, profit is mine BUT loss is yours! Hope the cycle doesn't repeat in these times.