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Charts & Analysis

Nifty in April Turns 2013 Around with a 4.4% Return

The Nifty was up 4.4% in a reversal month of April, 2013, bringing the Year-To-Date return up to a marginally positive number (0.4%).

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May has traditionally been a volatile month, skewed largely by the 28% move in 2009 (post elections), –17% in 2004 (again, post elections), –14% in 2006 (after RPL’s IPO and a quick drop) and large moves in the 90s.

May has the highest standard-deviation which tells you why the “average” means little. Given that, it may be useful to trade calls and puts (straddles or strangles) that will make money on large moves in either direction. However, I would do this closer to the 10th of the month to lose lesser and lesser from time decay.

The Sensex, too, has done well, but only a 3.5% move:

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And finally, that 2013 is benign upto April. If it’s anything like other such benign-till-April years of 2007 and 2010, it’s just likely to go up.

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