STOCK MARKETS INVESTMENTS - QUESTIONS & ANSWERS LEKHA TANDON ANSWERS

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short asked, hi what is the min margin to short nifty future
Lekha Tandon answers, Margins range from 10-20% depending on the contract
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Mark asked, Hi Lekha, I am a new investor (started a couple of months back) and have started with a holding between 2-3 Lacs. I mostly invest in small caps and look to achieve a target of 20-22% return in a months time. So far i have been able to achieve my targets with in a months span. I would like to know what are the good options (stocks and sectors) for me to improve my target time in smallcap. Also in the present market will it be wise to shift from smallcap to midcap.
Lekha Tandon answers, I would advise you to limit your smallcap exposure - while small cap stocks do well when markets rise, they fall very badly in bear markets (e.g. 2008)
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bunty asked, what is safe method for only 10% return monthly?
Lekha Tandon answers, No one can provide you 10% returns a month. Equity investments cna provide 15-20% a year on average.
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Mona asked, How these large cap, mid cap etc funds are different from each other? Which one is good for the not so experienced people?
Lekha Tandon answers, For newer entrants, large-cap funds are the safest option
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mks asked, Do PMS firms guarantee return.

Lekha Tandon answers, As per SEBI, PMS firms cannot guarantee returns, but many can give a guideline for the returns they expect.
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Shashi asked, How does PMS work?
Lekha Tandon answers, PMS refers to a SEBI approved group of investment professionals providing you a portfolio tailored to your needs. It is recommended for individuals investing more than 5 lakhs (as per SEBI guidelines)
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deb asked, Im new to the Share Market. I had invested some amt on mutual fund one year before but all are now in poor condition. I want to start in the market. please advice.
Lekha Tandon answers, I would think about my asset allocation, and look for fund managers with strong investment backgrounds and good 5+ year track records.
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nir asked, What are the evergreen companies in which i don't have to look back for say 10 years and i will get good return.
Lekha Tandon answers, Focus on large and mid-cap companies.
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rajanr asked, What are the options for invetsing in silver and in commodities in India ? Do we have ETFs in silver and commodities ?
Lekha Tandon answers, There are professional investment advisors who can structure a commodity portfolio for you. We dont have a silver ETF.
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ramanji asked, i am emply i want to invest in safe sector for initial time where can i invest
Lekha Tandon answers, Focus on a portfolio holding 6-10 sectors, so that your are insulated from one particular sector crashing (e.g. telecom)
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notrader asked, How can i minimize losses in commodity trading
Lekha Tandon answers, Work with an investment advisor who can help you structure an appropriate portfolio on commodities.
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Mona asked, Is it advisable to buy MFs directly from the market or through some PMS?
Lekha Tandon answers, If you have a large corpus (5 lakhs +), I recommend PMS because you get a more customized service that is carefully managed for your needs.
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vickys asked, Hi Lekha, I am new to stock market and plan to start investing in stocks. Would appreciate if you can give me some tips.. thx
Lekha Tandon answers, Are you doing it for an investment purpose - if so I recommend starting with a mutual fund/PMS
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Sagar asked, I want to trade and invest on Banking Stocks. Is there any website which can give me day to day informaiton on how the Banking sector is performing?
Lekha Tandon answers, NSE has a bank index, NIFTY Banks which broadly indicates how bank stocks are doing
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notrader asked, any good books to read on commodity trading
Lekha Tandon answers, Commodity Insights Yearbook 2009 published by MCX and PWC
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Mohit asked, What is Exchange Traded Fund,and how safe it is?
Lekha Tandon answers, ETF is like a mutual fund,but traded on an exchange. It is a very safe product, in particular look at NIFTY BEES and LIQUID BEES
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ramanji asked, hi i am new to stock market how can i get nessacery info
Lekha Tandon answers, Work with a professional investment advisor who can show you various equity options.
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viswa1 asked, for short term like 1 month where to invest equity, debt, gold.?
Lekha Tandon answers, equity investments are not recommended for the short-term, hold a debt investment.
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Rahul asked, Hello. I am a first timer in stock trading. Most of my frens who are into stock trading have suggested me to start with buying RIL shares. Whats your opnion on RIL, what would be the best buy price and what should be the target?
Lekha Tandon answers, Be careful of just holding RIL shares on a friends advice. Try an equity mutual fund/PMS
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drainbrain asked, Any opinion on MIDCAP investment?
Lekha Tandon answers, Mid-caps are a good addition to a portfolio.
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pavan asked, hi. i wanted to know in which company shuold i invest, and i am a student, i wanted to invest in the bse market so
Lekha Tandon answers, Invest in a portfolio of large and mid-cap stocks from the NIFTY, diversified across sectors.
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WannaBeFinanciallyFree asked, My portfolio is Bharti Airtel, Unitech, Pipavav Shipyard, 3i Infotech, Suzlon Energy, Punj Lloyd, Bharati Shipyard, Sun TV Network, NTPC, Mahindra Satyam, ICICI Bank, RIL, SBI, Tata Motors. Is my portfolio good or should I add/remove some stocks??? I am looking for long term investment only
Lekha Tandon answers, Try to hold a portfolio of 30-50 stocks, with more sectors so it is more diversified.
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abhishek asked, madam, i m a young investor, i want to invest abt 1 lakh for 1 year, pls advice me
Lekha Tandon answers, Allocate a portion in equities (diversified funds), some in debt mutual funds and some in gold/commodities.
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HELLO asked, is intraday adviced?
Lekha Tandon answers, No, hold investments for the long term
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notrader asked, How do i become expert in commodity trading
Lekha Tandon answers, Work with a professional investment advisor who can help you build a commodities portfolio.
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jsuresh asked, thanks for the info. but dont u think SEBI should remove the cap of 5lacs, to enable more people to take the pms service and thus increase the volume. Still if u know somebody doing PMS of small amnt , pl inform .
Lekha Tandon answers, No one can legally do PMS under 5 lakhs. be careful of people providing the service without a SEBI registration.
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boo asked, hi, Is forex trading advisable like a salaried class like mine.Is it necessary to spend minimum one hour to make some money? pls advice
Lekha Tandon answers, Forex is a good investment, although I recommend you consult professional forex advisors to structure a portfolio/strategy for you.
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Syed asked, how different are BSE and NSE?
Lekha Tandon answers, Both are big exchanges, the NSE has more volume than the BSE
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tvvk asked, What is PMS?
Lekha Tandon answers, Portfolio Management Services - an investment service where a group of professional managers provide a customized portfolio for your needs. Preferable to mutual funds for clients with a reasonable corpus (5 lakhs +)
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Jitendra asked, Lekha, pl. advise what a short-term to medium term investor should do in a falling market? Sell his holding at enter at lower levels or wait for marke to imrove? which is a bette option?
Lekha Tandon answers, If you are in for the long term, wait for the market to improve, or allocate a portion of equity to debt.
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vic asked, how much percent of my salary is safe to invest every month , if i have salary of 15000. is equity a good options or gold to invest?
Lekha Tandon answers, Invest 10% of your salary in a combination of equity, debt, gold.
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viswa asked, I very new to shares I want to opena DEMAT ACCOUNT which one is good ICICI,HDFC or Citibank?
Lekha Tandon answers, HDFC, AXIS are good - check that the demat provider is giving you good rates on your trading.
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Girish asked, What should be the division (% wise) for investments. Assuming I invest in Equities, Mutual Funds, PPF/NSC and Gold? I am 28 years of age and can take risks.
Lekha Tandon answers, Roughly - 40-60% equities, 20-30% debt, and the rest in gold. Would have to understand your needs further to come up with a full investment plan.
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vic asked, is this really good time for the first timers like me to buy in market?
Lekha Tandon answers, First times should not start by investing a large amount in single stocks. Focus on building a good portfolio with professional guidance.
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vic asked, what can be more beneficial mutual funds or Stocks
Lekha Tandon answers, For people who are new to the markets, PMS/mutual funds are better because they provide a more diversified offering that is less risky than holding stocks.
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daddy asked, Lekha, do you require a hedge fund manager for currency trading to diversify your portfolio ? If yes, where can I contact you ? My specialisation in EUR/USD, and AUD/USD. Ofcourse technical charting applicable anywhere.
Lekha Tandon answers, Currency trading like equity trading requires systematic thought and analysis.
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RAv asked, which sectors are good to invest
Lekha Tandon answers, Hold a range of sectors, rather than concentrating in one or two. It will reduce the risk of your portfolio.
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rajn asked, I have invested for the last 6 months in SIP Rs 2000 in DWS alpha equity and Rs 3000 in RSF now i want to replace DWS alpha equity with hdfc top 200 and also add a mid cap fund like sundaram SMILE. Should i change, can u suggest any other change
Lekha Tandon answers, Try to look at diversified funds with low costs, and good 5+ year performance.
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Jag asked, Is it a good option to invest in Gold ETF at this point for 2 yrs??
Lekha Tandon answers, Gold is a good asset class, does well when equities do badly.
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Mona asked, Hi! I am new to the market but want to invest in mutual fund. But how to choose a good one?
Lekha Tandon answers, Start by deciding your asset allocation and work with a good investment advisor to choose good diversified funds.
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PANKAJ asked, IS FUND MANAGEMENT EQUIVALENT TO STOCK TRADING?
Lekha Tandon answers, No. Fund management is about disciplined systematic analysis of portfolios, including managing risk. Trading is only a part of fund management.
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jsuresh asked, i want to hold pms service, but only with 10-15 thousand rs to start with, who is the good service provider?
Lekha Tandon answers, PMS starts at 5lakhs as per SEBI regulations and most providers require 10+ lakhs.
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kasturi asked, equity and debt both
Lekha Tandon answers, In equities, look at diversified equity funds, in debt, short term mutual funds.
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daddy asked, Whats the outlook for dollar ? i think it is going to remain as the worlds reserve currency. We have hit an intermediate bottom in the USD, and this inverse correlation of dollar and equity markets is at work. Your thoughts ? Do you trade currencies ? Much better option i think.
Lekha Tandon answers, We (my firm) do investment advisory services for currencies (in particular the RUPEE vs. the DOLLAR).
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Syed asked, what are your tips for Intraday?
Lekha Tandon answers, We do long term investments, rather than Intraday
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stock asked, Is PE ratio enough to decide wheather to decide that a stock is good or invest
Lekha Tandon answers, No, that is only one metric - there are many other metrics that should be taken into account.
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Prasanna asked, I'm new to trading..any suggestions?
Lekha Tandon answers, Start by deciding how much you are going to allocate to equities v. other asset classes, and hold a balanced equity portfolio
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psn asked, what is the future of telecom sector in india
Lekha Tandon answers, Hard to say, but looks tough in the short term because of the regulatory changes.
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kasturi asked, please suggest so good mutual funds where rs 3 laks can be invested
Lekha Tandon answers,. In general in equities, look at diversified funds and NIFTY BEES, in debt, short term debt funds.
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PANKAJ asked, I M AN ACTIVE STOCK TRADER 4 THE LAST 5 YEARS. IS IT A GOOD CAREER OPTION. PLZ ADVICE.
Lekha Tandon answers, Fund management is a rewarding career, if pursued in a systematic and careful way.
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sunilj asked, with all the revealations..can you site reasons for companies fudging numbers ??
Lekha Tandon answers, Only companies can answer why they fudge numbers :)
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changu asked, how to calculate intrinsic value of a share
Lekha Tandon answers, There are many valuation techniques for stock valuation - DCF, comparables, etc.
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sandy asked, what are your views on infrastructure
Lekha Tandon answers, Mixed. Many infra funds dont really give you infra exposure - they hold a basket of stocks that are not really infra stocks.
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Mistral asked, How helpful can a past record of an Infrastructure firm be for investing?
Lekha Tandon answers, Past records are helpful, but study it carefully. A good track record is long, and does well through bad market periods.
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Ajay asked, I have been noticing for a couple weeks know that Chinese market is bullish irrespective of what's happening to the global markets? can u pls explain. does Indian market have the same ability
Lekha Tandon answers, Every market will have ups and downs, no market can always be bullish
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kasturi asked, i would like to invest rs 3 laks for 2 years please suggest few stocks which i can buy and sell after 2 years and get good returns and which stock to buy and at what price
Lekha Tandon answers, Invest in a good equity mutual fund rather than a few stocks - look at a diversified mutual fund.
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sada asked, hi Lekha how can we invest in debt market? can we invest thru normat demat account?
Lekha Tandon answers, You can invest through debt mutual funds.
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ramesh asked, hi, i want to start invest in stock market,,,what is my first step?
Lekha Tandon answers, Work with an investment advisor, who can recommend a good set of funds. I don't recommend someone who is new starts buying stocks - it creates a very risky portfolio.
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prashkalantri asked, Suppose I Buy 10 shares of RIL for Rs.2000/- now which becomes Rs.1000/- each ex bonus. Can I sell 10 shares at Rs.1000/- and book short term capital loss.
Lekha Tandon answers, if you have held it under a year, then yes, if you sell it is a short term capital loss.
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vipin asked, i am 20 yr old guy pursuing my BE, invested around 55 lac in MF and 25 lac in PMS, now at 16500 market level getting around 35% return :D, should i stay in the market and withdraw all amount :)
Lekha Tandon answers, I would keep my investments for the long term, but make sure that the MF and PMS managers you have are providing you good, sustainable returns.
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hjhjhj asked, hi should i invest in L&T shares
Lekha Tandon answers, You can, but make sure youhold more than just L&T shares - dont risk your holdings to one company
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ramesh asked, hi, i want to start invest in stock market,,,what is my first step?
Lekha Tandon answers, decide what your asset allocation between debt, equities, and other asset classes is, and then select a few funds/products in each asset class. i have written an article previously on rediff on how you should get started
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RAJEEV asked, HOW WE CAN TRACK NIFTY FUTURE MOVEMENTS
Lekha Tandon answers, the NSE website shows you the movement of nifty futures
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Madesh asked, Hello Lekha I am new for trading. Will you guide me how to invest and take the returns in short time with less investement and minimum risk
Lekha Tandon answers, Work with a professional investment advisor who can recommend a set of debt and equity products for you to invest in.
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indrakumar asked, what is your views on telecom stocks buy or sell
Lekha Tandon answers, Telecom has hard a pretty hard run, and is uncertain because of the regulatory issues surrounding the industry.
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sandeep asked, How can we asses the position of any company to feel safer to buy its stock?
Lekha Tandon answers, Analyze the stock and understand the business
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abhi asked, whts DMA stands for....and how u calculate tht?
Lekha Tandon answers, Direct Market Access
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naj asked, all financial reports point to past performance, so how can one gauge the future prospects for a particular company while deciding to buy stocks?
Lekha Tandon answers, Many analysts provide future earnings estimates for companies.
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young asked, how to study fundamentals of company wat are criterians
Lekha Tandon answers, look for companies that are undervalued and have strong recent performance.
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Ajay asked, what's your take commodity market??
Lekha Tandon answers, Great market to enter, but very risky. I would consult an investment advisor to help you structure this.
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ash asked, where shd i conc now...mfs or equity??
Lekha Tandon answers, Depends on the size of investments.
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sunilj asked, dont u think fundamental data is loosing credentials with fudged sheets and unfolding scams ?
Lekha Tandon answers, Not necessarily. Systematic analysis of companies still has value. To protect yourself from scams, it is better to hold a larger more diversified portfolio that isnt hit as hard.
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srini asked, hi are the reality sector shares a better option now to invest?
Lekha Tandon answers, Real estate stocks are very risk, and you should be careful about owning them - the volatility in this sector is one of the highest.
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sunny asked, Hi Lekha, Do u like ULIPS in comparison to elss + term insurance
Lekha Tandon answers, No, ULIPS are a disaster. You pay high fees for insurance + equities, which are two separate decisions. Get a term insurance because it is cheap, and then if you want equities, make a separate equity investment.
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Ajay asked, hi Lekha i have been trading for a couple of years know in equity market. now i want to enter commodity market what do you recommend??
Lekha Tandon answers, It is a good market to enter, but commodities have a high degree of risk and are expensive to trade. I would recommend you work with an investment advisor who can structure a commodity portfolio for you.
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naj asked, Hello Lekha, my portfolio of equities is biased towards banking and oil&gas. Which sectors can help to balance it? Thanks
Lekha Tandon answers, Hold a portfolio that is balanced across sectors and reflects the market. Holding a single sector concentrates your risk pretty significantly. Balanced portfolios hold banking, pharma, FMCG, oil, materials, telecom, utilities - about 6-10 sectors
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young asked, how to keep trailing stop loss in delivery based transaction bcoz you cannot modify stop loss of executed transaction
Lekha Tandon answers, Focus on controlling portfolio level losses rather than stock level losses, as the market falls, allocate more capital from equities to cash
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udaya asked, HI, i'am new to the market. I want to know that how much minimum capital required for intra day trading?
Lekha Tandon answers, Intra-day trading is not recommended for those who are new to the market, focus on long-term investments.
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Jag asked, Hi Lekha..Good afternoon..whatsis the difference between Equity Market and Debt Market? In which we should invest and what proportion?
Lekha Tandon answers, Equities means buying the stocks of companies, and are a risky asset class. Debt means buying bonds issued by a govt/company and are a safer asset class. Invest a proportion in equities and a proportion in debt.