What will happen if a stock is added or removed from nifty50 ?

What will happen if a stock is added or removed from nifty50 ?

In February 2017, a news of BHEL and Idea being removed from the Nifty50 must have caught your eyes. If u have been in the stock market or following it for a while you must have heard of such news of stocks getting added to or removed from or replaced by others in the Nifty 50 quite a number of times. Ever wondered what this means? Let us try to understand the implications of addition or deletion of stocks from Nifty 50. But before we go into the details let us try to understand what Nifty 50 is. Nifty 50 is …… The NIFTY 50 index is an index of 50 stocks which are believed to be the broad representatives of the market. NIFTY is National Stock Exchange (NSE) of India’s benchmark index for Indian equity market comprising of 50 stocks belonging to 23 diverse sectors. It is widely followed by stock market investors. Following is the list of stocks comprising NIFTY 50 Company Name Industry ACC Cement – Major Adani Ports Infrastructure – General Ambuja Cements Cement – Major Asian Paints Paints & Varnishes Aurobindo Pharm Pharmaceuticals Axis Bank Banks – Private Sector Bajaj Auto Auto – 2 & 3 Wheelers Bank of Baroda Banks – Public Sector Bharti Airtel Telecommunications – Service Bharti Infratel Telecommunications – Equipment Bosch Auto Ancillaries BPCL Refineries Cipla Pharmaceuticals Coal India Mining & Minerals Dr Reddys Labs Pharmaceuticals Eicher Motors Auto – LCVs & HCVs GAIL Oil Drilling And Exploration Grasim Diversified HCL Tech Computers – Software HDFC Finance – Housing HDFC Bank Banks – Private Sector Hero Motocorp Auto – 2 & 3...
How do penny stocks work? – What I Wish Everyone Knew About Penny Stocks

How do penny stocks work? – What I Wish Everyone Knew About Penny Stocks

If you have been into trading you must have heard instances of people earning big bucks from penny stocks. You might yourself be tempted to invest in these. Before we give you any tips on how to make penny stocks work for you let’s just quickly go over what penny stocks are.  Understanding Penny Stocks work Normally by penny stock, we understand a stock that trades on the bourses at sub-one rupee price. But according to the National Stock Exchange(NSE )and the Bombay Stock Exchange (BSE), the stocks trading below10 are all penny stocks and belong to the T2T (trade-to-trade) category. They have market capitalisation (number of shares outstanding times present by penny price of the share) lower than ₹100crores.The US SEC (stock market regulator) categorises all stocks trading below $5 as penny stock. These are high risk stock and obviously, you would want to invest in it if the return is high or at least expected to be high or else why would you take the pain. There is no specific logic, at least not always, as to why most of their prices will rally generating a very high return. There is also high risk of the exact opposite happening. There’s a high risk-return trade off. So … … How do they work? These stocks are favourite of the manipulators. Why? Simple. The low price of the stocks make manipulation easy and often without drawing much attention from the stock market regulators. Say a stock is trading at ₹2 it is easy for manipulators to drive it to ₹3 in a week or fortnight or even a month...
Why should you start ELSS from April itself?

Why should you start ELSS from April itself?

Why start ELSS from April itself?    Tax is on my mind Tax is in my soul Tax is in my life I am just taxing on. Every taxpayer goes through this during the last quarter of the financial year. Sudden decisions are made without proper planning. To save tax becomes the objective for investing.A lump sum amount is then invested in the Equity Linked Savings Schemes (ELSS). When the Rs 1.5 lakh eligible for deduction is allocated to different asset classes, you heave a sigh of relief. But there is a problem with this method. It is always better to invest in ELSS through systematic investment plan (SIP). Begin your SIP from April to get the most of your ELSS. Here’s why you should start investing in ELSS right from the beginning of the financial year: Equity-linked As the name suggests, ELSS invest most of the accumulated funds in stocks. Thus, as applicable to every investment in the stock market, you must begin early to get the maximum benefit. Equity is known to give best returns over the long-term. The sooner you invest in ELSS; your funds get more time to multiply. If you begin investing in December/January, you are losing the benefit for nine months. Rupee cost averaging Stock markets fluctuate very frequently. So, when you invest in one go, how can you be sure that you got the best price for purchase dunits ? What if the market fell further after you invested Rs 30,000 lump sum in ELSS? Timing the market is a difficult task. To overcome the market volatility, the best thing to do...
The Ultimate guide Of Corporate Action – Bonus / Split / Rights Issue

The Ultimate guide Of Corporate Action – Bonus / Split / Rights Issue

Corporate Action – Bonus / Split / Rights Issue Investors frequently come across terms such as bonus, stock splits and right issues. All these are examples of what we call corporate actions. These are simply actions taken by a company once agreed upon by its board of directors andthen authorized by its shareholders.All such actions have announcement date, ex-date, and record date. Let’s have a quick look at what these corporate actions mean which will help us understand their impact on the company’s share prices. Bonus A bonus issue is a stock dividend. A company allots these shares for rewarding its shareholders. Issue dout of the company’s reserves,bonus shares are free and the shareholders receive them against the shares currently held.Allotments are typically made in a fixed ratio e.g., 1:1, 2:1, 3:1 etc. A 2:1 bonus ratio means the existing shareholders (as on the record date) will get 2 additional shares for every 1 share held at zero cost. A shareholder holding 100 shares will get additional 200 shares free, taking his total number of shares held to 300. On bonus issue, the number of shares held will increase but the overall value of investment will remain the same. Hence price per share reduces. Let’s take an illustration Bonus Issue No of shares held before bonus Share price before Bonus issue Value of Investment Number of shares held after Bonus Share price after Bonus issue Value of Investment 1:1 200 50 10,000 400 25.0 10,000 2:1 20 200 4,000 60 66.7 4,000 4:1 1000 20 20,000 5,000 4.0 20,000 Companies generally give away bonus shares to boost participation of retail...