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General

On Slack: Squeezing the small saver, Indigo A320neo, Mideast Money and more….

The Slack Discussions

The Slack group at Capital Mind Premium has been extremely active and if you haven’t been there, pop us a note by replying to this email. (If you’re a trial member this probably sound like Greek to you; it will be available when you sign up!)

A brief summary of some of the interesting things discussed there in the last few days:

Slack Logo2

#general: United’s Quest to be less awful

A bungled merger. A corruption scandal. Three CEOs in a year. But hey, at least the snacks are free again. (Link)

#general: Squeezing the small saver

Policymakers and commentators in India talk quite a lot about the need to channel long-term retail savings into financial instruments. They freely criticise the retail investor’s lack of a long-term ‘mindset’. ‘When retail investors can lock into property or gold for 15 to 20 years at a time, why can’t they do the same with bonds or equities?’ they ask.

But the explanation is quite simple. Small savers looking to park their long-term surpluses have hardly any suitable options left. (Link)

#stocks: Airbus CEO confirms IndiGo as second operator of the A320neo

As launch customer Deutsche Lufthansa took delivery of its second Airbus A320neo, Airbus CEO Fabrice Brégier has reportedly told Air Transport World that IndiGo, India’s largest domestic carrier, and largest Indian operator of the A320 family aircraft will be the next operator of the new fuel-efficient plane. (Link)

#mutualfunds: @NagpalManoj

SIP Returns – Last 10 yr SIP returns 10.75% – If u chose top 10 MFs in 2006! 15%+ SIP returns are a myth!

SIP Returns

#macronomics: @Schuldensuehner

How much more could Sovereign Wealth Funds sell if oil goes to $20? According to JPM $145bn of government bonds, $113bn equities.

Selling by reserve managers

#general: The Agony of High Returns

Even with a time machine, a lot of people wouldn’t want to own the best-performing stocks.(Link)

#general: With 21L flyers, Mumbai-Dubai India’s busiest international route in 2015

(Link)

#macronomics: Mideast Money-Defying global slump, Iran stocks soar on sanctions relief

(Link)

#general: What is retention statement?

SEBI mandates that every broker shall once in a quarter, transfer any excess funds lying in the client’s trading account back to his bank account. What it means is that in case there are any unutilized funds in your trading account, the broker is compulsorily required to send these funds back to your bank account.

This was with the intention of ensuring that brokers don’t misuse client’s idle funds. (Link)

#macronomics: RBI chief Rajan says not in favour of devaluing exchange rate

Reserve Bank of India (RBI) Governor Raghuram Rajan said on Monday he was not in favour of devaluing exchange rates to boost economic growth, signalling India will not join other countries such as China or Japan in pushing down their currencies.

“I personally feel sustained devaluation is neither feasible nor a good strategy,” Rajan said in a speech at a conference on medium scale enterprises in Thiruvananthapuram. “This (devaluation) is not the intent of RBI.” (Link)

#general: Oil ministry working on policy for spot trading of crude oil PSUs

The oil ministry is working on a policy for setting up a trading desk for oil marketing companies which will allow them to buy crude from the spot market as against the time consuming tendering process now, Minister Dharmendra Pradhan said. (Link)

#stocks: BoB forex scam: RBI finds irregularities in banks’ transactions

(Link)

#general: India Asks Vodafone to Pay $2.1 Billion Tax Bill or It May Face Asset Seizures

India said it may seize Vodafone Group Plc’s assets in the country if the company doesn’t pay a disputed 142-billion-rupee ($2.1 billion) tax bill that’s still undergoing international arbitration proceedings, according to a copy of the notice that was sent to the company this month.

Anil Sant, deputy commissioner of income tax, informed the company’s Vodafone International Holdings BV Dutch unit of its dues in a letter dated Feb. 4, according to the document, a copy of which was seen by Bloomberg News. Spokesman Ben Padovan at Vodafone and a representative at India’s tax department declined to comment. (Link)

#general: Stretch Your Wireless Data Plan Instead of Paying More

A data diet doesn’t require drastic changes, just vigilance and small adjustments to apps like Facebook and Snapchat. (Link)

#general: Indian Company to launch $7 Smartphone on Wednesday

Once considered a luxury product, a smartphone has grown to become a commodity over the years. But on Wednesday, things will reach a whole new level. As part of its attempt to connect every Indian, local smartphone manufacturer Ringing Bells ‘with immense support from’ the India government will launch an affordable smartphone called the Freedom 251 on Wednesday. The Freedom 251, touted as India’s cheapest smartphone -and likely the most affordable smartphone in the world as well – will sport a price tag below Rs. 500 (approximately $7). (Link)

#general: Government keen to rope in India Inc giants like Ratan Tata, Deepak Parekh, NR Narayana Murthy for Bank Board Bureau

The Centre is looking to rope in industry stalwarts such as Ratan Tata, NR Narayana Murthy, Deepak Parekh and Naina Lal Kidwai for its proposed Bank Board Bureau (BBB).

“This is a major step towards governance reforms in state-run banks and we want to ensure that credible and distinguis
hed industry leaders are on this platform,” said a government official aware of the deliberations. (Link)

#general: Zimbabwe Raises $1 Million From Sale of Elephants to China

Zimbabwe raised $1 million from the sale of elephants to China and will continue exporting to the Asian country as part of conservation efforts, wildlife authorities said.

“We exported 24 elephants last year to China and we know that only one died. The rest are still alive,” Edson Chidziya, director general of the Zimbabwe National Parks and Wildlife Authority told lawmakers in the capital, Harare on Monday. The proceeds were used toward conservation programs, he said. (Link)

#general-from the past: Zambians hold prayer for plummeting currency

The Zambian High Commission in Windhoek in association with the Association of Zambians in Namibia (AZANA) held a national day of prayer and fasting at the Roman Catholic Hospital Hall in Windhoek on Sunday.

At the event Zambia’s High Commissioner to Namibia Sylvia Bambala Chalikosa said there are a number of compounding factors which necessitated the call for national solemn reflection.(Link)

#general: Something’s rotten in India’s startup scene – and it’s time to call it out

(Link)

#general: Zomato to stop charging from restaurants

A week after breaking even in six markets across the globe, online restaurant search, rating and food ordering company Zomato wants to stop charging commission from restaurants covered by it, co-founder Pankaj Chaddah told Business Standard. This would apply to orders generated from the platform as well as for providing last-mile delivery services. (Link)

#general: Sensex may sink to 15000 if 21300-22500 support zone breaks: ASA

Vivek Patil, who saw the ongoing market crash last year, says the Sensex can sink to 15,000 levels (Link)

#general: Will the Year of the Monkey bring cheer to the Sensex?

Whether the rally in the Indian markets will sustain or not depends to a large extent on the currency movement by China and the Indian govt’s ability to stick to the fiscal consolidation plan. (Link)

#general: Narendra Modi’s about-face on taxation might cost Vodafone billions

(Link)

#macronomics: Export Collapse – Myth Or Reality?

Exports have fallen in terms of value but not so much in terms of volume. Rather it’s the falling commodity prices of petroleum, iron, steel and the agricultural sectors which are the prime reason behind the fall. (Link)

#macronomics: Oil Speculators Shrug Off Huge Stockpiles to Bet on Price Climb

Oil stockpiles at an 86-year high and warnings of a persistent glut weren’t enough to keep money managers from betting that prices are ready for a rebound.

Speculators’ long positions in West Texas Intermediate crude climbed to the highest since June as oil sank toward a 12-year low, according to U.S. Commodity Futures Trading Commission data. Despite a 12 percent rally Friday, WTI finished last week down 4.7 percent. Prices on Monday gained 1.3 percent to $29.82 a barrel at 11:46 a.m. in New York. (Link)

#macronomics: We will not hesitate to act: Draghi

In pre-released remarks, European Central Bank (ECB) President Mario Draghi told the European Parliament on Monday that to make “the euro area more resilient, contributions from all policy areas are needed.”

“The ECB is ready to do its part,” Draghi said. (Link)

#macronomics: Saudi, Russian Oil Ministers Plan Talks in Doha Tuesday

Ali al-Naimi, the most senior oil official of the world’s biggest crude exporter, will speak with Russia’s Alexander Novak in the Qatari capital, according to the person, who asked not to be identified because the talks are private. The person didn’t say what the agenda of the meeting will be, which will also be attended by the kingdom’s fellow OPEC member Venezuela. The energy ministries of Russia and Saudi Arabia declined to comment. (Link)

#stocks: Vedanta To Set up India’s 1st LCD Panel Plant

(Link)

#stocks-from the past: Sterlite to Set Up LCD Panel Plant in India; Invest Rs. 40,000 Crores

Billionaire Anil Agarwal-led Sterlite Technologies on Wednesday announced an investment of Rs. 40,000 crores to set up a LCD panel manufacturing plant in the country, generating about 50,000 jobs.

The company, which makes optical fibres used in high speed Internet services, is also working on a project to connect defence establishments through optical fibres in Jammu & Kashmir (J&K). (Link)

#stocks: PBOC’s Zhou says no basis for continued yuan depreciation

China’s central bank governor Zhou Xiaochuan said in an interview at the weekend there is no basis for continued yuan depreciation. In an wide-ranging interview with financial magazine Caixin, Zhou spoke during a week-long holiday in China with markets shut, warning the PBOC won’t allow speculators to dominate market sentiment, and downplayed concerns over the sharp decline in the country’s foreign-exchange reserves over the past few months. (Link)

#general-from the past: Amazon begins a new chapter with opening of first physical bookstore

World’s biggest online retailer opens shop in Seattle’s University Village stocked with 6,000 books at same price as on its website. (Link)

#stocks: Nissan issues termination notice to Ashok Leyland in LCV tech JV

The development comes after Ashok Leyland sent a notice to Nissan last week on technology-related matters. A week after Ashok Leyland Limited (ALL) sent a notice to its partner Nissan, in the light commercial vehicle (LCV) joint venture (JV), the latter now
sent a termination notice to ALL for the technology JV.

Both partners have formed three JVs — one for vehicle assembly, one for engine assembly and one for vehicle development. (Link)

#general: @deepakmohoni

The Sensex is the worst performer among global indices today. (Oil rally?)

Sensex is the worst performer among global indices today

#macronomics: Four oil producers agree to freeze output at Jan levels

(Link)

#backtobasics:

3X5 Options Trading System – Link

AHL Explains – Momentum – Link

Black Cross/Golden Cross: Long-Term Moving Average – Link

How can I find stocks that are undervalued? – Link

Kevin O’Leary on Money and Investing – Link

P/E Ratio Analysis of Nifty in 2015 (Since last 16+ Years) – Link

Secrets of the MIT Poker Course – Link

Short Straddles and their defence – Link

The Good Judgment Project – Link

The Death of the Death of Books – Link

#recommended-readings:

Superforecasting: The Art and Science of Prediction – Link

Trading and Exchanges: Market Microstructure for Practitioners – Link

The Signal and the Noise: The Art and Science of Prediction – Link

Volatility Trading, + Website – Link

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Disclaimer

Nothing in this newsletter is financial advice and should not be construed as such. Please do not take trading decisions based solely on the matter above; if you do, it is entirely at your own risk without any liability to Capital Mind. This is educational or informational matter only, and is provided as an opinion. 

Disclosure: The authors at Capital Mind have positions in the market and some of them may support or contradict the material given above, or may involve a direction derived from independent analysis.