Technical Analysis

SIP REPORT
TECHNICAL ANALYSIS AND OPTIONS

STRATEGIES FOR STOCK PREDICTION
SUBMITTED BY
(MASOOM TEKWANI)
Enrolment no.: 1-18-072
2018 – 20
UNDER THE GUIDANCE OF
FACULTY GUIDE: Prof. Tirthank Shah
COMPANY GUIDE: Mr. Nirav Kansariwala

TECHNICAL ANALYSIS AND OPTIONS STRATEGIES FOR STOCK PREDICTION
UNDERTAKING
I, MASOOM TEKWANI, the author of the SIP titled TECHNICAL ANALYSIS

AND OPTIONS STRATEGY FOR STOCK PREDICTION, hereby declare that
this is an independent work of mine carried out towards partial fulfilment of the
requirements for the award of the PGDM/PGDM-C diploma by Shanti Business
School, Ahmedabad, India. All views and opinions expressed in this report are my
mine, and do not necessarily represent those of the institute and/or Jainam Share
Consultants.
Signature of the Student: _________________

Name of student : MASOOM TEKWANI
Enrolment No.: : 1-18-072
Date : ___________________
Place : Ahmedabad
ii
iii
CERTIFICATE
This is to certify that the Summer Internship Project (SIP) titled “Technical Analysis
and Options Strategies for Stock Prediction” has been submitted by Masoom
Tekwani towards partial fulfilment of the requirements for the award of
PGDM/PGDM-C diploma at Shanti Business School and has been carried out under
my/our supervision.
Guide (Name) : Prof. Tirthank Shah
Guide Signature :
Date :
iv
ACKNOWLEDGMENTS
I Masoom Tekwani, would like to take this opportunity to express my deepest

gratitude to my faculty guide Mr. Tirthank Shah, for the continuous support and
follow up during the entire process of SIP without which the successful completion of
SIP would not have been possible.
I would also like to express my sincere gratitude to my industry guide Mr. Nirav
Kansariwala for his valuable support and guidance at the organisation and thus
helping me in the successful completion of the SIP.
I am also grateful to our institute Shanti Business School (SBS) and its director
Dr. Neha Sharma for providing us with this wonderful opportunity to work in the
corporate sector and thus providing us with the first-hand experience to understand
the corporate sector by being a part of it.
Finally I would like to thank the placement team at SBS Mr. Kartik Iyer and Ms.
Riddhima Mukul for working tirelessly to place us in our desired organisation with
good project(s).
v
EXECUTIVE SUMMARY
Every individual who wants to utilize their money in profitable way through stock
market choose either trading or investing in various stocks depending on their nature
of time period within which they want the returns. This study focuses on predicting
the profitable stocks for both traders who often take advantage of small mispricing in
the market and earns short term profit and for investors who Study Company’s
potential for long term growth and value.
The first section of the study is related to Positional trading in which trader holds the
position for weeks to months. To earn profitably through positional trading, the future
price trends should be known. Various experts have their own way to predict the
future and one such way is through TECHNICAL ANALYSIS.
The company Jainam Share Consultants provide such facilities related to trading
through technical analysis. My work was related to analysis of various strategies of
technical analysis and options strategy under research department.
This study involves understanding of technical analysis, different chart patterns,

indicators and different options strategies. To predict the future trend of any stocks or
indices back testing needs to be done.
This report includes the back testing done on past data of prices of various stocks. The
testing was done on strategies such as Exponential moving average, sum of average
trades in which two moving averages are used. The index BANK NIFTY was also
back tested on options strategy – Short Straddle both weekly and monthly.
The second section of the report consists of FUNDAMENTAL ANALYSIS done on

selected companies of NBFC sector. To predict whether a particular company is
profitable to invest in or not, the fair value of stocks need to be identified through
studying the fundamentals of the company.
There are various ways for fundamental analysis but this report focuses on qualitative
analysis and quantitative analysis. The qualitative analysis is based on understanding
the business model and other things affecting the market price but cannot be measured
numerically. The quantitative analysis is done through various ratios and
vi
understanding the financial statements of the company. The stock return analysis is
also done by calculating the past monthly return on closing prices of selected
companies
The main purpose of the whole study is to identify the stocks which will be profitable
in future for trading or investing. So according to the results of back testing through
technical analysis the stocks which shown profit in past can be used in future for
trading. And according to fundamental analysis of selected companies, the investors
can invest in company which shows good results in ratios and return wise of NBFC
sector.
vii
TABLE OF CONTENTS
Chapters Page No.

1 INTRODUCTION
About- Jainam share consultants Pvt. Ltd. 1
1.1 Objectives of the study 2
2 REVIEW OF LITERATURE 3
3 INDUSTRY ANALYSIS – STOCK BROKING 4
INDUSTRY 4
3.1 Stock Market Participants 5
3.2 Stock Market Instruments 5
3.3 Future and Options Market 6
3.4 PESTLE analysis of stock market
4 COMPANY ANALYSIS – JAINAM SHARE 9
CONSULTANTS 9
4.1 Brief History 10
4.2 products/services 10
4.3 Competitors 12
4.4 Organisational Structure 13
4.5 Senior Management 14
4.6 Various Departments 19
4.7 Functions 22
4.8 SWOT Analysis
5 STUDY 1- BRIEF ABOUT TECHNICAL 24
ANALYSIS AND OPTIONS STRATEGY
RESEARCH METHODOLOGY
5.1 Introduction to technical analysis 24
5.2 Types of charts 25
5.3 price patterns 27
5.4 Indicators 28
5.5 Introduction to options 29
5.6 Research Methodology 32
viii
6 ANALYSIS OF STRATEGY 34
6.1 EMA 50 34
6.2 Sum of Average Trade 36
6.3 EMA 50 High/Low 38
6.4 Sum of Average Trade High/Low 46
6.5 Weekly Short Straddle 54
6.6 Monthly Short Straddle 55
7 STUDY 2 – FUNDAMENTAL ANALYSIS ON 57
SELECTED COMPANIES OF NBFC SECTOR
7.1 Introduction to NBFC sector 57
7.2 Brief about selected companies 57
8 ANALYSIS OF COMPANIES 59
8.1 Qualitative Analysis of individual companies 59
8.2 Comparative Analysis through ratios 63
8.3 Comparative Analysis through stock return 79
8.4 Findings and conclusion 82
9 Achievements 84
10 Limitations 85
11 Conclusion 86
Bibliography 87
List of Tables 88
ix
CHAPTER 1
ABOUT: JAINAM SHARE CONSULTANTS
Pvt. Ltd.
Jainam Share Consultants Pvt. Ltd. was incorporated on November 10, 2003 & is
mainly carrying on the broking business in the equity market. The company was
incorporated with the vision to be the most preferred organization providing all
financial services across the country. The foundation is on "Value" Systems - "Value"
addition to Corporate, Retails and HNI Individuals through superior Wealth Creation
Practices. The services provided by Jainam to its customers are following:
 Equity trading
 Derivative trading
 Currency trading
 Commodity trading
 Delta / arbitrage desk
 MF & insurance
 Comprehensive financial planning
 Depository services
 IPO
 Bonds
 NRI services
VISION STATEMENT:
To be the most preferred organization providing all financial services across the
country. The foundation is on "Value" Systems - "Value" addition to Corporate,
Retails and HNI Individuals through superior Wealth Creation Practices.
1
MISSION STATEMENT:
“PROSPERITY WITH SECURITY”
1.1 OBJECTIVES OF STUDY:
PRIMARY OBJECTIVE: To understand and apply various trading strategies related

to technical analysis for the purpose of analyzing the future trend and picking the
most profitable stocks.
SECONDARY OBJECTIVES:
 To understand the basics of the stock market industry
 To understand the functions of various departments at JAINAM broking firm
 To learn the basics of technical analysis and options strategies.
 To learn the forecasting of future price trends
 To learn how the practical trading is being done
 To understand how different strategies work on different scrips and index
2
CHAPTER 2
REVIEW OF LITERATURE
 JOHN J. MURPHY (1999) TECHNICAL ANALYSIS OF FINANCIAL

MARKETS.
This textbook contains all the information related to technical analysis. The
purpose was to understand the philosophy behind the analysis, the terms such
support and resistance, how the trend forms from the major reversal and
continuation patterns and how the indicators and oscillators shows the future
price movement.
 MANOJ SINGH (2019) AN INTRODUCTION TO STOCK MARKET

This article described about the overview of Indian stock market and which
are the two major stock exchanges. The market index and the participants
involved in this market.
 DERIVATIVE MARKET, NSE(1993)

The textbook is related to the information regarding derivative market, how
the future and options can be traded. The strategies that can be used for trading
in F&O market and payoff profile for buyers and sellers.
 DRAKOPOULOU V (2015) A REVIEW OF FUNDAMENTAL AND

TECHNICAL STOCK ANALYSIS TECHNIQUES
This technical paper presents the leading fundamental analysis and stock
valuation techniques used by daily equity traders in the selection of stocks in
actively traded equity portfolios. This paper briefs about two approaches to
equity valuation used for fundamental analysis and major indicators used for
technical analysis
3
CHAPTER 3
INDUSTRY ANALYSIS
The stock market refers to public markets that exist for issuing, buying and selling
stocks that trade on a stock exchange or over-the-counter. Stocks, also known as
equities, represent fractional ownership in a company, and the stock market is a place
where investors can buy and sell ownership of such investible assets. An efficiently
functioning stock market is considered critical to economic development, as it gives
companies the ability to quickly access capital from the public.
3.1 STOCK MARKET PARTICIPANTS
 STOCKBROKERS: They are the licensed professionals who buy and sell
securities on behalf of investors. The brokers act as intermediaries between the
stock exchanges and the investors by buying and selling stocks on the
investors' behalf. An account with a retail broker is needed to gain access into
the markets.
 STOCK ANALYSTS: Perform research and rate the securities as buy, sell, or
hold. This research is available to clients and interested parties who decide
whether to buy or sell the stock.
 PORTFOLIO MANAGERS: They are professionals who invest portfolios, or
collections of securities, for clients. These managers get recommendations
from analysts and make the buy or sell decisions for the portfolio. Mutual fund
companies, hedge funds, and pension plans use portfolio managers to make
decisions and set the investment strategies for the money they hold.
 INVESTMENT BANKERS: Represent companies in various capacities, such
as private companies that want to go public via an IPO or companies that are
involved in pending mergers and acquisitions. They take care of the listing
process in compliance with regulatory requirements of the stock market.
 MARKET MAKER: A market maker is a broker-dealer who facilitates the

trading of shares by posting bid and ask prices along with maintaining an
4
inventory of shares. He ensures sufficient liquidity in the market for a

particular (set of) share(s), and profits from the difference between the bids
and ask price he quotes.
3.2 STOCK MARKET INSTRUMENTS
 SHARES/ EQUITY: Equities or stocks or shares give you ownership of a

company. You can buy or sell shares through a broker.
 MUTUAL FUNDS: Here, the money is pooled from many investors and then
invested in various financial instruments. Investors are referred to as unit
holders. Profit generated is distributed to unit holders in proportion to the units
held by them.
 BONDS: These are fixed income instruments also known as debt instruments
by which government or a company borrows money from investors at an
agreed interest rate for a specific tenure. These are less risky when compared
to shares.
 DERIVATIVES: A derivative is a financial contract whose value is derived
from an underlying asset. It can be used to mitigate a number of risks.
Derivatives include forward, futures, options and swaps.
3.3 FUTURES AND OPTIONS MARKET:
Futures and options on stocks and indices are offered by exchanges such as NSE and
BSE. A stock futures contract facilitates purchase or sale of a stock at a preset price
for delivery on a later date. A call option on a stock allows you to purchase the
5
underlier at a preset price on a future date, while, a put option allows you to sell the
underlier. Normally, delivery is not taken or given on F&O segment, only the
difference in buy or sell price at squaring off to when position was initiated
is exchanged between buyers and sellers, unknown to each other.
3.4 PESTLE ANALYSIS OF STOCK MARKET:
POLITICAL: The share market of India changes as the political changes took place.
The BSE Index, SENSEX goes up and down with any kind of small and big political
news, like, if there is news that a particular political party has withdrawn its support
from the ruling party, and then the stock market will go down with a bang. The stock
market of India is too weak and is based on speculations. The political stability of the
country is very important for the stability and growth of stock market in India. The
political imbalance or balance of the country is the major factor in deciding the stock
market of India. The political factors include:
 employment laws
 tax policy
 trade restrictions and tariffs
 political stability
ECONOMICAL: The economical measures taken by the government of India has a

very strong relationship with the stock market. Whenever the annual budget is
announced the stock market goes up and down with the economical policies of the
government .If the policies are supportive to the companies then the stock market
takes it positively and if there is any other policy that is not supportive and it is not
welcomed then the stock market goes down. Like, in the case of allocation of 3-G
spectrum, those companies that got the license for 3-G, they witnessed sharp growth
in their share values so the economic policies play a major part in the growth and
decline of the stock market and again if there is relaxation on any kind of taxes on
items of automobile industry then the share of automobile sector goes up and virtually
strengthen the stock market .The economical factors include:
 inflation rate
6
 economic growth
 exchange rates
 interest rates
SOCIAL: There is some relation between the social factors with the stock market. If
there is any big social factor then to some extent it affects the stock market but small
social factors don’t impact at all. Like, there was opposition of reliance fresh in many
cities and many stores were closed. The share prices of the reliance fresh went down
but the impact was on and individual firm there was not much impact on the stock
market on a whole the social factors have not much of impact on the stock market in
India. The social factors include:
 emphasis on safety
 career attitudes
 population growth rate
 age distribution
 health consciousness
TECHNOLOGICAL: Same as social factors, technological factor can have an effect

on an individual form but it cannot have a big impact on a whole of stock market. The
Bajaj got a patent on its dts-i technology, and launched it in its new bike but it does
not effect on stock market. The technological change in India is always on a lower
basis and it doesn’t effect on country as a whole. The technological factors include:
 R&D activity
 technology incentives
 rate of technological change
 automation
ENVIORNMENTAL FACTORS: Initially, the environmental factors don’t play a

vital role in the stock market. But the time has changed and people are more eco-
friendly. This is really bothering them that if any firm or industry is environment
friendly or not. An increasing number of people, investors, and corporate executives
are paying importance to these facts; the stock markets still see the environment as a
7
liability. They belie that it is of no use for their strategy. The environmental
performance is even under-valued by the markets.
LEGAL FACTORS: Legal factors play an important role in the development and
sustain the stock market. Legal issues relating to any industry or firm decides the fate
of the stock market. If the govt. of India or the parliament introduces a new law that
can affect the running of the industry then the industry will be demotivated and this
demonization will lead to the demonization of the investors and will result in the fall
of stock market. Like after the Harshad Mehta scam, new rules and regulations were
introduced like PAN card was made necessary for trading, if any investor was
investing too much money in a small firm, then the investors were questioned, etc.
These regulations were meant to maintain transparency in the stock market, but at that
time, investment was discouraged. Legal factors are necessary for the improvement
and stability of the stock market.
8
CHAPTER 4
COMPANY ANALYSIS
The Company Jainam Share Consultants Pvt. Ltd. is mainly carrying on the share
broking business in the equity market. The name”JAINAM” has the etymology from
the names of three families together. “J” stands for Dr. Jitendra Shah, “N” stands for
Mr. Nipun Shah, and “M” stands for Mr. Milan Parikh. The company’s motto is
“PROSPERITY WITH SECURITY”.
BOARD OF DIRECTORS:
 Dr. Jitendra Shah
 Mr. Milan Parikh
 Mr. Nipun Shah
 Mr. Chirag Shah
CORE VALUES:
 Integrity
 Transparency
 Continual Improvement
 Respect
 Offer more than what we are paid for
 Speed
4.1 A BRIEF HISTORY OF THE COMPANY

Jainam Share Consultants Pvt. Ltd. was incorporated on November 10, 2003 & is
mainly carrying on the broking business in the equity market. The company was
incorporated with the vision to be the most preferred organization providing all
financial services across the country. The foundation is on "Value" Systems - "Value"
addition to Corporate, Retails and HNI Individuals through superior Wealth Creation
Practices.
Over the years, the company has acquired memberships of the major stock exchanges
of India viz. National Stock Exchange of India Ltd. (NSE), Bombay Stock Exchange
9
Ltd. (BSE) & MCX Stock Exchange Ltd. (MCX-SX). The company is also a
registered as Depository Participant with the Central Depository Services of (I) Ltd.
Since incorporation the company has been consistently growing with the present
client base of around 52000+ clients in Know Your Client (KYC) and 40500+ clients
in Depository Participants (DP). The company has 450+ outlets to cater to the needs
of the investors for their equity trading in the stock exchanges.
4.2 PRODUCTS/SERVICES OF THE COMPANY
Jainam Share Consultants Pvt. Ltd. provides all types of services like:-
 Equity Trading
 Derivatives Trading
 Currency Trading
 Depository Services
 Online Trading
 Jobbing Arbitrage
 Mutual Fund, Insurance
 FD, IPO.
4.3 MAJOR COMPETITORS
The major competitors of the company are as follows-
 Motilal Oswal
 Sharekhan
 Reliance Securities Ltd.
 Zerodha Stock
 Bonanza Portfolio Ltd
 Tradebulls Securities Pvt.Ltd
10
11
4.4 ORGANISATIONAL STRUCTURE
CHAIRMAN& MD
DIRECTOR DIRECTOR DIRECTOR
SENIOR COO BUSINESS COO

MANAGE DEVELOPMENT OPERATIONS
MENT &CONTROL
MIDDL
HOD
E HOD support
business HOD back HOD a/c’s and
MANA services
development office fin
GEMEN
T
TEA
Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Mgr. Manager Manag
M
Term subbr Bran Mktg Rese Insu DP/K Securit Client Gen surv. Banki customer admin systems compli
LEA op. oker ches . arch ranc YC y a/c a/c ng care &HR
D e
OPER Executiv Execu Exec Exec Exec Exec Exec Execut Executi Execut Execu Executi Executi Executive Executive Exec
ATIN e tive utive utive utive utive utive ive ve ive tive ve ve
G
PERS
12
ONNE
4.5 SENIOR MANAGEMENT
Dr. Jitendra Shah
Mr. Chirag Mr. Nipun Shah Mr. Milan Parikh

Shah
Customer care SALES &
ACCOUNT &
MARKETING
AUDIT CLIENT
HR
KYC - DP ACCOUNT
SURVEILLANCE
ADMIN
IT COMMODITIES
RESEARCH DATA, JOBBING

COMPLIANCE
ARBITRAGE
WMS SECURITY
BUSINESS
DEVELOPMENT
13
4.6 VARIOUS DEPARTMENTS

 MARKETING DEPARTMENT
a. Products:
Sr. No Name Investment Investment Tenure Expected
Vehicle Amount return
1. Marvel Equity-Mid cap 1 Lac (min) 1 year 15-17%
2. India opportunity Equity-Large 1 Lac (min) 1 year 15-17%

Cap
Pure value picks

3. (PVP) Equity 10 Lacs 5 years 20 % above
hurdle
amount
4. Bull Edge(Cheque) Equity cash 1 Lac (min) 1 year 15-18%
5. Intra Edge(Cheque) Equity/Futures 1/5 Lacs - 15-20%
6. Intra edge(stock) Equity/Futures 1/5 Lacs 1 year 15%
Tech
7. Trendz(Cheque) Index futures 6 lacs 3 years 10-12%
8. Tech Trendz(Stock) Index futures 6 lacs 3 years 8-10%
b. Marketing Process: First they will collect the data of customer from
the BSE and NSE than they will contact those customers and arrange a
14
meeting as per the client schedule. Then they explain the product of the
company as per the interest of the customer.
c. Customer service: They are having customer department where every
query or problem of customers has been solved, Customer department
is the heart of their company and they are having well trained people in
that department to service the customers at the time of duty.
 HUMAN RESOURCE DEPARTMENT

HR & Admin departments take care of all requirements of employees. Following are
the main HR and Admin Functional areas-
 Manpower Planning
 Recruitment & Selection
 Training & Development
 Performance Management System and Performance Appraisal
 Salary Administration
 Motivation
 Arrangement of Welfare Activities
 Resolving conflicts
 Disciplinary and Grievance Handling who violate the company's rules
and regulation.
RECRUITMENT:
 Manpower planning- It is to be done by HR Manager in consultation with all
HODs before it is put up for approval by Directors. Philosophy of Jainam is
“keep minimum man-power, train and develop multi skills and get maximum
output.”
 Recruitment Procedure- Two type of recruitment process is there, Internal
and External procedure. First preference will be given to internal selection and
internal transfer.
 Internal selection: In case of internal transfer they promote
employees by providing extra responsibility and rewards with this
they can reduce their recruitment cost and can motivate internal
staff by giving new opportunities and challenge.
15

External selection: In external recruitment system Jainam has tied
up with different recruitment consultancy, they pay recruitment
charges to these consultants as per pre-decided agreement.

Aniket Consultancy Pvt. LTD. : 8.33%

Darshan placement : 50% of Monthly salary

Job Mantra : 8.33%

Make in India : Rs 1000 per candidate
 After approval of Manpower requisition form, HR department gives the detail

requirements to recruitment consultants by mail or on phone. All these
consultants scrutinize the data and mail the shortlisted candidate’s bio-data to
HR Manager for interview scheduling.
 After getting Resume of candidates from consultants, HR manager study the
resume. HR Dept. will forward all the available applications to HOD for short-
listing. Concerned HOD will short-list applications and send back to HR Dept.
for schedule the candidates for interview.
 At the time of Interview candidates have to fill the “Candidate Profile Sheet”
(copy attached). In this form all the details related to personal, Educational and
Experience related information have to fill by candidates.
 After filing these data HR Manager will take the preliminary Interview of
candidate. Than if HR manager feel that this candidate is suitable for that
particular post than they arrange interview with respected HODs. HOD will
take the technical interview of candidate.
 Selection/Short-list/Hold/ Rejected views will be given by HOD to HR
department. Comments related to decision of selection, salary, joining and
probation will be mention on his/her Bio - Data or Candidate profile sheet.
 In case of senior level recruitment, Director will take final interview of the
candidates. In this case minimum 2 to 3 interviews will be taken by HODs.
 HOD will decide the Designation, Salary and other benefits to be offered.
Once approval is given on this, HR Department will issue offer letter to
selected candidates.
16
TRAINING AND DEVELOPMENT:

This policy has been formulated with a view to ensure full utilization of the
inherent skills and abilities of employees and provide them with
comprehensive foundations needed for successful performance in their job and
in subsequent career progression. Various training conducted for employees
are as follows-
 INDUCTION
 TRAINING
 PRODUCTIVITY TRAINING
 SALES TRAINING
 COMPETENCE AND SKILL DEVELOPMENT
 MOTIVATIONAL TRAINING
 RESEARCH TRAINING
And many more different training are conducted for growth and development
of employees.
Jainam is having one training hall at Head Office with seating capacity of 50
to 55 employees.
 Induction: HR Manager will take the Induction training of all new joined
employees within a month of date of joining. Induction training will include:-
ORGANIZATION STRUCTURE AND DEPARTMENT STRUCTURE
 JAINAM HISTORY
 OVERVIEW OF SHARE MARKET
 STATUARY COMPLIANCE
 WELFARE ACTIVITIES
 DEPARTMENTAL WORK PROCESS
 GENERAL DISPLINARY POLICY
 Probation for 3 months: Employee will be on probation for a period of 3
months. It is likely to be extended for any further periods as may be deemed
fit, and you would not be deemed to be confirmed unless a confirmation is
given to you. During the probation, or its extension, as the case may be the
company shall have the right to terminate your service without assigning any
reason with the notice periods.
17
 RESEARCH DEPARTMENT
We have established an excellent research that is backed by professionally
trained persons. We have best research tools that are updated on regular basis.
This helps us to track major events in markets as and when they occur, thus
giving us advantage of faster execution on any important information that
would lead to wealth creation for our clients.
 Fundamental Research
 Daily Morning News Letter
 Market Mirror
 Weekly Maalamaal
 Weekly and Monthly Outlook(English and Gujarati)
 Fundamental Equity Analysis and Reports
 Special Market Reports
 IPO Analysis
 Results Preview
 Technical Analysis
 Technical reports
 Live Intra – day & Momentum Calls (SMS and Yahoo
Messenger)
 Short Term Delivery Calls
 Derivatives Strategies
 Investment Advisory Services
 Portfolio Restructuring
 Value Added HNI services

WEALTH MANAGEMENT DEPARTMENT
Main Services of this department are as below:
 IPO
 Mutual Fund
 Fixed Deposit
 Life Insurance
18
 General Insurance
 Debentures
SYSTEMS & SOFTWARE: Systems department is the heart of the company. This
department needs to maintain 100% uptime for all type of connectivity, Networking
and other technology. Handling Hardware and Connectivity related problems of all
department and Branches. Jainam owns In-House Software development department.
PRODUCT DEVELOPMENT: This department is focusing on developing new
products for all segments like Equity, Currency, Debt, mutual fund etc. They are
launching their product by organizing seminars, Training for SB, Clients &
Employees.
BRANCH DEVELOPMENT: This department is focusing on expansion of
organization and managing all branches & their developments. Motivating all
branches for business development and handling grievance of all branches.
SALES & MARKETING: This department is focusing on expansion of organization
by tie up with new Sub Brokers, New Clients, Corporate companies & Organize
Corporate seminars for business promotion.
SUB-BROKER DEVELOPMENT: This department takes care of our entire Sub –
Brokers. Handling their query and giving them required solution. We organize award
functions for our Sub-brokers and give them awards for special categories for best
performance.
4.7 FUNCTIONS:
KYC-Know Your Client: This is the initial step of the process where the new client
needs to submit his documents to open his/her account for trading.
DP services: A depository is an organization which holds investor’s securities
(shares, bonds etc.) in electronic from through Depository Participant. The Depository
Participant also provides services related to various transactions in such securities.
They provide service to customer by efficient management of securities in electronic
form through demat accounts.
Currency: Being a member of Currency Derivatives Segment on NSE, BSE & MCX-
SX, would give Indian investors another tool for hedging their foreign exchange risk
effectively & flexibly at transparent rates on an electronic trading platform. These
19
currency derivatives are expected to benefit participants, including hedgers,

speculators & arbitrageurs.
Commodity: Indian Market has recently thrown open a new avenue for retail
investors and trades to participate in commodity trading. You can diversify your
portfolio beyond shares, bonds & real estate-Commodity which provide the best
option. Retail investors can trace in commodity futures without having any physical
stocks. Jainam is a trading-cum-clearing member of MCX and NCDEX.
Security: The main function of this department is to doing Pay-In and Pay-Out of
Shares, Other functions are
Corporate Action – Dividend, Bonus, Split, Scheme of arrangement, Reduction of
capital etc.
Client pay out
Handling Auction
Billing of BSE and NSE
Customer care: Customer Care is the heart of any organization. Customer will come
first in this department only. Our executives are solving queries of clients, giving
trade summary – debit credit - ledgers etc.
Client account: Main work of this department is collection and payment of clients’
funds.
Surveillance
File uploading of limit setting
Selling of client stock
Handling HNI clients.
Providing and managing ongoing limit setting
Compliance: As per the exchange rules certain rules and regulations to be followed
by each member broker. This department checks whether all kind of rules and
regulations are followed in company. On that basis certain reporting as per the
requirement of the exchange has to be made by this department. This department also
look after the legal matters of the company.
20
THE CUSTOMER:
There are two types of customers in this business; trader or investor both came with
the same motive i.e. to make money. Jainam is having different products for both the
customers, Customer who came for the trading purpose will take their on call by
opening accounts in Jainam and they have been providing better services over here
and proper guidance will be given by the departments and customers have to pay the
brokerage to the company. Customer came for the Investment purpose; they can
invest in the different products of the company as per their requirement or where they
find good return. In Jainam they provide consultancy to manage wealth of the
customers.
THE ENVIRONMENT:
In the environment of the company, it is the sum total of all external and internal
factors that influence a business.
External factors:
1. Macroeconomic factors: Are the factors that affect the entire
economy not just the business, If the interest rate, currency exchange
rate, consumer saving rate etc will affect broking business if they will
save less they don’t come to invest in our products. This business will
be totally affected by these factors.
2. Political Factors: People do trading on the basis of news, after the
news of demonetization; there was so much fluctuation in the Indian Stock Markets.
THE TECHNOLOGY:
1. Thumb impression machine: They use this machine in the head
office to take attendance of the employees, recording of attendance
shall be compulsory every time while an employee enters or leaves the
relevant premises.
2. SMART : SMS Facility
3. E-reports: Facility to view all the reports on your mail ID
4. EASI: Facility to view the holding with valuation.
SOFTWARE:
Jainam owns In-house software development department to maintain 100% uptime for
all type of connectivity, Networking and other technology. They are using different
21
software to work with speed of market. In the research department they use ODIN to
buy or sell the shares and Trend analyzer to follow the market trend using different
indicators.
4.8 SWOT ANALYSIS:

STRENTHS:
Core strength of jainam:
 Milan parikh who has excellent contacts and relationships with sub-brokers in
surat
 Nipun shah has the knowledge that is needed to complete the difficult
procedure of getting various memberships.
 Dr. Jitendra shah – the senior and most respectable member of team jainam
who has the ability to motivate all to reach great heights.
Other strengths:
 Every customer is provided one stop solution for trading in the equities market
and commodities market.
 Provisions of free, state of art research to all clients.
 Dedicated and experienced team for any type work.
 Inspiring and powerful leadership.
WEAKNESS:
 Less penetration in rural areas.
 Indians are mostly conservative and prefer investing in gold and land.
 Increased competition as there are many financial firms.
 Lack of sufficient branch offices for speedy delivery of services.
 Constant pressure to be cost competitive to meet customer expectations.
OPPORTUNITIES:
 Growing awareness of capital market it can raise its client’s base.
 High purchasing power and people looking for more investment opportunities.
 Increasing usage of online trading
 As interest on fixed deposits with post office and banks are all time low, more
and more small investors are entering into stock market.
22
THREATS:
 Changes in SEBI guidelines and other tax implications
 Stringent economic measures by government and RBI
 Entry of foreign finance firms in Indian market
 SEBI’s approvals to paytm for starting stock broking services can a huge
threat to broking firms.
23
CHAPTER 5
STUDY 1 -BREIF ABOUT TECHNICAL
ANALYSIS AND OPTIONS STRATEGY
RESEARCH METHODOLOGY
5.1 TECHNICAL ANALYSIS

Technical analysis is the study of market actions, primarily through the use of charts,
for the purpose of forecasting future price trends. The term market action includes the
three principal sources of information available to the technician—price, volume and
open interest. (Open interest is used only in futures and options.)
There are three philosophies on which technical analysis is based:-
 Market action discounts everything
 Price move in trends
 History repeats itself
Market Action Discounts Everything refers to what technicians believe is that

anything that can possibly affect the price whether fundamental, political or
psychological factors are actually reflected in the price. In other words, it explains
that price action should reflect shifts in supply and demand. If demand exceeds
supply, prices should fall and vice versa. This action is the basis of all fundamental
forecasting.
Price Moves in Trends is absolutely essential to the technical approach. The whole
purpose of charting the price actions of a market is to identify trends in the early
stages of their development for the purpose of trading in the direction of those trends.
24
Above figure is the example of an uptrend. Technical analysis is based on theory that
markets generally move in trends and those trends are tend to persist.
History repeats itself— much of the body of technical analysis and the study of
market actions have to do with the study of human psychology. Chart patterns, for
example, which have been identified and categorized over several years, reflect
certain pictures on the price charts. These pictures reveal the bullish or bearish
psychology of the market. They are based on the study of human psychology- which
tends not to change. In short, the key to understand the future lies in the study of the
past, or we can say future is just the repetition of the past.
5.2 TYPES OF CHARTS

The daily bar chart is already acknowledged as the most widely used type of chart in
technical analysis. There are also other types of charts used by the technicians such as
line charts, point and figure charts and candlesticks.
1. Daily Bar Chart
It’s called a bar chart because each day’s range is represented by a vertical bar.
The bar chart shows open, high, low, closing prices. The tic to the right shows
the closing price and tic to the left of the vertical bar shows the opening price.
25
2. Line Chart
In the line chart, only the closing price is plotted for each successive day.
Many chartists believe that the closing price is the most critical price of the
trading day; a line chart is a more valid measure of price activity.
3. Point and Figure Chart

The third type of chart is the point and figure chart. This chart shows the same
price action but in a more compressed format. Notice the alternative columns
of X’s and O’s. The X column shows rising prices and the O columns shows
declining prices. Buy and sell signals are more precise and easier to spot in
this chart.
26
4. Candlesticks
Candlestick charts are the Japanese version of the Bar chart. On this chart, a
thin line shows the day’s price range from high to low. A wider portion of the
bar measures the distance between the open and the close. If the close is
higher than the open, the real body is white and if the close is lower than the
open, the real body is black.
5.3 PRICE PATTERNS:

There are two major categories of price patterns – REVERSAL and
CONTINUATION. As this names imply, reversal pattern indicate that an important
reversal in trend is taking place. The continuation patterns, on the other hand, suggest
27
that the market is only pausing for a while, possibly to correct a near term overbought
or oversold condition, after which the existing trend will be resumed. The trick is to
distinguish between two types of patterns as early as possible during the formation of
pattern.
Volume plays an important confirming role in all of these price patterns. In times of
doubt a study of the volume pattern accompanying the price data can be the deciding
factor as to whether or not the pattern can be trusted.
5.4 INDICATORS:
A technical indicator is a series of data points that are derived by applying a formula
to the price data of a security. Some indicators may use only the closing prices, while
others incorporate volume and open interest into their formulas. For analysis
purposes, technical indicators are usually shown in a graphical form above or below a
security's price chart. Once shown in graphical form, an indicator can then be
compared with the corresponding price chart of the security. Sometimes indicators are
plotted on top of the price plot for a more direct comparison.
Some of the indicators studied in this project are:
 MOVING AVERAGES
The moving average is one of the most versatile and widely used of all
indicators. It is an average of certain body of data. The data to be averaged
moves forward with each new trading day therefore moving has been used.
There are three types of moving averages – simple, weighted and exponential
moving average
 BOLLINGER BANDS
In this two trading bands are placed around a moving average as envelopes
which are usually S.D below and above moving averages. It is overextended
on upside when they touch the upper band and vice versa.
OTHER IMPORTANT TERMS:-

There were some terms which were a major part of our during our internship. These
terms were the basis of our Back-Testing and analysis work. These are as follows-
28
 SYSTEMATIC TRADING – The whole research is based on systematic

trading which means there are pre set rules which automatically defines entry
and exit signals which is to be followed and no human intervention in required
after rules are made. The steps of systematic trading are –
1. Select the time frame
2. Choose the price data
3. Determine the trading rules
 PNL- PNL is abbreviated for Profit and Loss. During our training, this was
our core term and our main objective was to maximize PNL. We have used
PNL for scrips in % and in points as it was required in the strategy.
 DRAWDOWN- Drawdown is the maximum possible loss percentage for
particular script. A technical analyst wants it to be as low as possible. The
more the Drawdown, the more the stock is risky.
 PROBABILITY- Probability % shows us the probable percentage profit for
script.
5.5 INTRODUCTION TO OPTIONS
An option is a contract written by a seller that conveys to the buyer the right — but
not the obligation — to buy (in the case of a call option) or to sell (in the case of a
put option) a particular asset, at a particular price (Strike price / Exercise price) in
future. In return for granting the option, the seller collects a payment (the premium)
from the buyer. Exchange-traded options form an important class of options which
have standardized contract features and trade on public exchanges, facilitating
trading among large number of investors. They provide settlement guarantee by the
Clearing Corporation thereby reducing counterparty risk. Options can be used for
hedging, taking a view on the future direction of the market, for arbitrage or for
implementing strategies which can help in generating income for investors under
various market conditions.
29
STRATEGY 1: LONG CALL

For aggressive investors who are very bullish about the prospects for a stock / index,
buying calls can be an excellent way to capture the upside potential with limited
downside risk. Buying a call is an easy strategy to understand. When you buy it
means you are bullish. Buying a call means you are very bullish and expect the
underlying stock /index to rise in future.
When to Use: Investor is very bullish on the stock / index.
Risk: Limited to the Premium (Maximum loss if market expires at or below

the option strike price). Reward: Unlimited
Breakeven: Strike Price +Premium
STRATEGY 2: SHORT CALL
When you buy a Call you are hoping that the underlying stock / index would rise.
When you expect the underlying stock / index to fall you do the opposite. When an
investor is very bearish about a stock / index and expects the prices to fall, he can sell
Call options. This position offers limited profit potential and the possibility of large
losses on big advances in underlying prices. Although easy to execute it is a risky
strategy since the seller of the Call is exposed to unlimited risk.
When to use: Investor is very aggressive and he is very bearish about the stock/index.
Risk: Unlimited
Reward: Limited to the amount of Premium
Break-even point: Strike Price+ Premium
STRATEGY 3: LONG PUT

Buying a Put is the opposite of buying a Call. When you buy a Call you are bullish
about the stock / index. When an investor is bearish, he can buy a Put option. A Put
Option gives the buyer of the Put a right to sell the stock (to the Put seller) at a pre-
specified price and thereby limit his risk.
When to use: Investor is bearish about the stock /index.
30
Risk: Limited to the amount of Premium paid. (Maximum loss if stock / index expire
at or above the option strike price).
Reward: Unlimited
Break-even Point: Stock Price – Premium
STRATEGY 4: SHORT PUT

Selling a Put is opposite of buying a Put. An investor buys Put when he is bearish on
a stock. An investor Sells Put when he is Bullish about the stock – expects the stock
price to rise or stay sideways at the minimum. When you sell a Put, you earn a
Premium (from the buyer of the Put). You have sold someone the right to sell you
the stock at the strike price. If the stock price increases beyond the strike price, the
short put position will make a profit for the seller by the amount of the premium,
since the buyer will not exercise the Put option and the Put seller can retain the
Premium (which is his maximum profit). But, if the stock price decreases below the
strike price, by more than the amount of the premium, the Put seller will lose money.
The potential loss being unlimited (until the stock price fall to zero).
When to Use: Investor is very Bullish on the stock / index. The main idea is
to make a short term income.
Risk: Put Strike Price –Put Premium.
Reward: Limited to the amount of Premium received.
Breakeven: Put Strike Price - Premium
STRATEGY 5: LONG STRADDLE

A straddle is a volatility strategy and is used when the stock price/ index is expected
to show large movements. This strategy involves buying a call as well as put on the
same index / stock for the same maturity and strike price, to take advantage of a
movement in either direction, a soaring or plummeting value of stock/ index. If the
price of the stock increases, the call is exercised while the put expires worthless and
the price of the stock decreases the put is exercised, the call expires worthless.
When to Use: The investor thinks that the underlying stock / index will experience
significant volatility in the near term.
31
Risk: Limited to the initial premium paid.

Reward: Unlimited
Breakeven:
· Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid
· Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid
STRATEGY 6: SHORT STRADDLE

A Short Straddle is the opposite of Long Straddle. It is a strategy to be adopted when
the investor feels the market will not show much movement. He sells a Call and a Put
on the same stock / index for the same maturity and strike price. It creates a net
income for the investor. If the stock / index do not move much in either direction, the
investor retains the Premium as neither the Call nor the Put will be exercised.
When to Use: The investor thinks that the underlying stock / index will experience
very little volatility in the near term.
Risk: Unlimited
Reward: Limited to the premium received
Breakeven:
· Upper Breakeven Point = Strike Price of Short Call + Net Premium
Received
· Lower Breakeven Point = Strike Price of Short Put - Net Premium Received.
5.6 RESEARCH METHODOLOGY:

RESEARCH DESIGN:
To determine whether the strategies being back tested is profitable or not,
CONCLUSIVE research design is being used. In that, DESCRIPTIVE research
design is used for this study to determine the future buy and sell signals for trading.
DATA COLLECTION:
The data required for this study is being collected through SECONDARY DATA
COLLECTION method. The data was being collected from below sources:
1. NSE India
2. Investing.com (charts)
3. Different stocks data
32
The size of data collection varies from each strategy but in common past 10 years data
was being taken for back testing.
DATA ANALYSIS:
The analysis is being done through various strategies used in technical analysis such
as:
1. Exponential single moving average (Indicators)
2. Sum of average trade EMA (Indicators)
3. Optimization process
4. Long and short straddle strategy (Options strategy)
5. Long and short strangle strategy (Options strategy)
SCOPE OF FUTURE STUDY:

 The study is limited to scrips trading in the F&O market. The same strategies
can be further used in testing of other scrips to know whether they are
profitable or not.
 The scrips are tested using only single indicator at a time, two indicators can
be combined and tested e.g. the EMA 50 high/low strategy can be tested along
with ADX indicator to know the strength of the trend.
33
CHAPTER 6
ANALYSIS OF STRATEGY
STRATEGIES
6.1 STRATEGY 1: EXPONENTIAL MOVING AVERAGE (EMA)
An exponential moving average - EMA is a type of moving average that places a
greater weight and significance on the most recent data points. The exponential
moving average - EMA is also referred to as the exponentially weighted moving
average. Exponentially weighted moving averages react more significantly to recent
price changes than a simple moving average, which applies an equal weight to all
observations in the period.
Common Uses of EMA
EMAs are commonly used in conjunction with other indicators to confirm significant
market moves and to gauge their validity. For traders who trade intraday and fast-
moving markets, the EMA is more applicable. Quite often traders use EMAs to
determine a trading bias. For example, if an EMA on a daily chart shows a strong
upward trend, an intraday trader’s strategy may be to trade only from the long side on
an intraday chart.
When price is Greater than EMA then we should Buy the Stock (Price >MA = Buy)
When price is Less than EMA then we should Sell the Stock (Price < MA= Sell)
(MA = Moving Average)
ANALYSIS:
The strategy is based on exponential moving average indicator. In this the average of
50 days has been taken which forms the EMA 50 line to indicate the trend. The time
frame is 60 min chart. The logic is that if EMA 50 crosses the price from below and
comes above the price it is sell signal as price is below the EMA 50 line and if the
EMA 50 cross the price from above and comes below the price it is buy signal. The
50 day average is selected on the profitability basis as which days average gives more
profit through optimization process (trend analyzer software available at the firm).
34
This strategy is being back tested on 25 scrips and their PNL, draw down and
probability has been calculated to test whether it is profitable or not
SUMMARY OF STRATEGY E50

DURATION – 2011 to 2019 COST – 0.2 %
TRA
PNL DES/
TRAD PRO Mont %/Ye MON PNL/
Name PNL DD PTS PNL% DD% ES B hs ar TH DD
MCDOWELL-
N -507.43 -800.06 -15.05 -144.04 983.00 18.92 97.15 -1.86 10.12 -0.10
MARUTI -3153.70 -5315.12 -114.19 -140.11 930.00 18.49 97.15 -14.10 9.57 -0.82
NBCC -81.95 -152.27 -193.62 -254.73 941.00 15.41 84.66 -27.44 11.12 -0.76
FEDERAL
BANK -147.93 -161.61 -198.47 -232.95 1000.00 18.70 97.15 -24.51 10.29 -0.85
PFC -206.18 -237.58 -221.54 -275.28 1044.00 18.87 97.15 -27.36 10.75 -0.80
BAJFINANCE -991.28 -1215.60 -231.67 -246.52 1052.00 16.73 97.15 -28.62 10.83 -0.94
HEXAWARE -698.45 -755.39 -290.30 -315.34 1009.00 18.24 97.15 -35.86 10.39 -0.92
NIFTYIT -30144.0 -30639.84 -301.64 -310.17 978.00 15.85 93.99 -38.51 10.40 -0.97
NMDC -393.23 -406.62 -352.93 -360.41 1017.00 17.11 97.15 -43.59 10.47 -0.98
ICICIBANK -909.06 -909.06 -357.50 -357.50 1066.00 17.07 97.15 -44.16 10.97 -1.00
BHARATFOR
GE -1668.35 -1670.08 -396.23 -398.46 1070.00 18.41 97.15 -48.94 11.01 -0.99
LUPIN -3618.51 -3626.70 -400.34 -402.37 1088.00 15.72 97.15 -49.45 11.20 -0.99
ASIAN
PAINTS -3166.79 -3213.25 -409.47 -426.55 1071.00 15.13 97.15 -50.58 11.02 -0.96
MINDTREE -1221.41 -1221.41 -430.01 -430.01 1102.00 15.15 97.15 -53.11 11.34 -1.00
TVSMOTOR -1202.97 -1228.24 -450.08 -455.30 1082.00 16.82 97.15 -55.59 11.14 -0.99
-
BAJAJ AUTO 10286.96 -10507.85 -484.46 -494.15 1101.00 16.89 97.15 -59.84 11.33 -0.98
DRREADY -9968.48 -9968.48 -489.79 -489.79 1103.00 15.32 97.15 -60.50 11.35 -1.00
HCL TECH -3577.28 -3577.28 -500.03 -500.03 1104.00 16.30 97.15 -61.76 11.36 -1.00
BEL -413.12 -443.25 -507.22 -534.30 1154.00 14.30 97.15 -62.65 11.88 -0.95
ACC -6766.87 -6842.02 -507.72 -514.29 1147.00 15.87 97.15 -62.71 11.81 -0.99
35
BRITANNIA -5812.19 -5814.65 -515.05 -515.55 1152.00 15.02 97.15 -63.62 11.86 -1.00
PEL -4830.28 -5380.67 -586.12 -609.22 1174.00 13.63 97.15 -72.40 12.08 -0.96
-
OFSS 19619.37 -19657.7 -666.56 -669.02 1212.00 12.79 97.15 -82.33 12.48 -1.00
NIITTECH -3474.07 -3474.07 -721.44 -721.44 1292.00 13.00 97.15 -89.11 13.30 -1.00
CUMMINS -5321.09 -5321.09 -806.26 -806.26 1304.00 12.81 97.15 -99.59 13.42 -1.00
TABLE 1: ANALYSIS OF SCRIPS ON EMA 50 STRATEGY
CONCLUSION:
All the scrips have been arranged on the basis of PNL %, as we can see all scrips have
been in loss and even DD% are negative only. So this strategy is not good to
implement in future as it is not profitable.
6.2 STRATEGY 2: SUM OF AVERAGE TRADE

In this strategy we had taken EMA OF 3 days, 5 days, 8 days, 13 days, 21 days, 34
days, 59 days and 89 days.
Classification:
Average Short: (EMA 3 + EMA 5 + EMA 8 + EMA 13 + EMA 21) / 5
Average Long: (EMA 34 + EMA 59 + EMA 89) /3
 If Avg. Short > Avg. Long then buy the script
 If Avg. Short < Avg. Long then sell the script
ANALYSIS:
The strategy is based on two moving averages – short and long. The average of 5
EMA has been taken for short moving average and the average of 3 EMA has been
taken for long moving average. The logic is that if short MA crosses the long MA and
comes above it then it is buy signal and if short MA crosses the long MA and comes
below it then it is sell signal. The time frame is 30 min chart. 25 scrips have been back
tested on this strategy.
36
SUMMARY OF STRATEGY SUM AVERAGE 30

DURATION – 2011 to 2019 COST – 0.2 %
PNL TRA PRO Mont PNL% TRADES PNL
NAME PNL DD PTS % DD% DES B hs /Year /MONTH /DD
MCDOWELL-N 251.7 -262.2 133.5 -48.8 652.0 25.6 97.2 16.5 6.7 2.7
MARUTI 510.7 -3736.8 10.5 -40.6 645.0 24.5 97.2 1.3 6.6 0.3
NBCC -23.2 -96.7 -1.6 -119.3 648.0 19.8 84.7 -0.2 7.7 0.0
PFC -115.1 -129.9 -93.3 -127.0 761.0 22.3 97.2 -11.5 7.8 -0.7
BAJFINANCE 59.5 -723.3 -145.7 -189.3 725.0 22.3 97.2 -18.0 7.5 -0.8
NIFTYIT -18187.0 -18628.7 -169.9 -176.9 658.0 21.3 94.0 -21.7 7.0 -1.0
HEXAWARE -458.5 -561.7 -177.0 -206.8 699.0 23.7 97.2 -21.9 7.2 -0.9
FEDERAL
BANK -144.2 -161.6 -181.0 -224.6 735.0 22.6 97.2 -22.4 7.6 -0.8
ICICI BANK -514.8 -515.9 -199.9 -205.7 707.0 23.2 97.2 -24.7 7.3 -1.0
LUPIN -1616.0 -1885.6 -209.8 -222.1 725.0 21.5 97.2 -25.9 7.5 -0.9
BAJAJ-AUTO -4551.3 -4920.6 -214.5 -229.0 693.0 24.1 97.2 -26.5 7.1 -0.9
MINDTREE -765.4 -845.3 -226.0 -226.0 751.0 20.0 97.2 -27.9 7.7 -1.0
DRREDDY -3277.5 -4294.7 -233.8 -233.8 759.0 20.4 97.2 -28.9 7.8 -1.0
TVSMOTOR -845.0 -880.5 -236.1 -241.4 739.0 22.7 97.2 -29.2 7.6 -1.0
NMDC -264.7 -303.0 -236.9 -266.4 727.0 21.7 97.2 -29.3 7.5 -0.9
ASIANPAINT -2107.5 -2175.5 -241.8 -266.8 733.0 19.9 97.2 -29.9 7.5 -0.9
BHARATFORGE -921.0 -974.1 -273.9 -286.2 740.0 22.4 97.2 -33.8 7.6 -1.0
BRITANNIA -3608.1 -3673.4 -294.1 -312.5 786.0 19.6 97.2 -36.3 8.1 -0.9
BEL -232.0 -255.0 -296.5 -318.4 778.0 20.1 97.2 -36.6 8.0 -0.9
ACC -4147.4 -4227.8 -322.9 -330.0 781.0 20.6 97.2 -39.9 8.0 -1.0
PEL -1740.2 -2967.8 -325.8 -398.5 792.0 18.8 97.2 -40.2 8.2 -0.8
HCLTECH -2849.3 -2852.1 -387.7 -389.6 777.0 19.7 97.2 -47.9 8.0 -1.0
OFSS -13991.0 -14036.6 -455.1 -458.0 785.0 18.9 97.2 -56.2 8.1 -1.0
NIITTECH -2571.6 -2625.4 -471.7 -503.7 834.0 16.7 97.2 -58.3 8.6 -0.9
CUMMINSIND -3669.1 -3669.1 -555.4 -555.4 836.0 18.1 97.2 -68.6 8.6 -1.0
TABLE 2 – ANALYSIS OF SCRIPS ON SUM OF AVG TRADE STRATEGY
37
CONCLUSION:
All the scrips have been arranged on the basis of PNL% as which is having more
profit. As it is been seen that only 2 scrips are having profit percentage rest all are in
loss so this strategy is also not good to be implemented in future.
6.3 STRATEGY 3: EMA 50 HIGH/LOW

This strategy is almost same as the first strategy of exponential moving average but as
in that PNL % was in loss, the rules of the strategy has been changed.
When price is Greater than EMA high price then we should Buy the Stock (Price >MA =
Buy)
When price is Less than EMA low price then we should Sell the Stock (Price < MA= Sell)
(MA = Moving Average)
RULE:
 Buy when high Price is crossed of script of particular candle when buy alert is
triggered
 Sell when Low price is crossed of script of particular candle when sell alert is
triggered
ANALYSIS:
In this strategy also the EMA 50 has been used and the time frame has been taken 60
min chart. The logic is that usually when price comes above the MA, buy is been done
at that candle but in this when price comes above the MA, if the high price of that
candle is crossed then only buy is been done so that no. of trades which are not
profitable can be reduced. And when the price comes below MA then if the low price
of that candle is crossed then only sell signal is there.
This strategy has been back tested on 121 scrips and their PNL % and DD% has been
calculated.
38
SUMMARY OF STRATEGY E50 HIGH/LOW

DURATION – 2011 TO 2019 COST – 0.2 %
TRA
TRAD PRO Month PNL% DES PNL/
NO. Name PNL DD PTS PNL% DD%
ES B s /Year /MO DD
NTH
1 PNB 394.19 -93.45 334.38 -46.38 527.00 25.62 100.18 40.06 5.26 7.21
ESCOR
2 533.87 -289.28 238.05 -40.51 493.00 28.40 100.14 28.53 4.92 5.88
TS
IDFCFI
3 62.80 -17.38 128.98 -25.68 186.00 32.26 41.92 36.92 4.44 5.02
RSTB
-
4 MRF 52291.98 201.58 -51.26 465.00 28.60 100.18 24.15 4.64 3.93
12491.01
5 DHFL 607.82 -346.76 229.56 -59.71 511.00 26.03 100.14 27.51 5.10 3.84
UNION
6 238.69 -90.02 206.73 -55.63 550.00 27.09 100.18 24.76 5.49 3.72
BANK
MCDO
7 WELL- 427.80 -213.81 132.71 -35.92 531.00 27.12 97.15 16.39 5.47 3.70
N
BHARA
8 454.32 -814.56 212.47 -83.47 513.00 25.15 100.14 25.46 5.12 2.55
TFIN
BAJFIN
9 431.05 -806.77 102.20 -45.68 512.00 26.37 97.15 12.62 5.27 2.24
ANCE
UJJIVA
10 203.16 -135.81 79.02 -39.87 188.00 27.66 35.90 26.41 5.24 1.98
N
11 NBCC 99.49 -44.11 211.67 -110.95 359.00 29.25 84.66 30.00 4.24 1.91
12 L&TFH 119.82 -42.98 105.31 -56.10 437.00 28.15 92.78 13.62 4.71 1.88
KAJARI
13 410.26 -376.25 143.84 -92.60 473.00 26.22 100.18 17.23 4.72 1.55
ACER
CEATL
14 790.57 -538.42 186.53 -122.85 514.00 26.07 100.14 22.35 5.13 1.52
TD
BANKI
15 141.45 -223.12 139.04 -92.41 593.00 24.28 100.14 16.66 5.92 1.50
NDIA
16 JUBLFO 334.94 -695.79 80.89 -59.31 525.00 25.90 100.18 9.69 5.24 1.36
39
OD
17 MCX 730.78 -789.08 98.97 -96.28 411.00 27.01 85.91 13.83 4.78 1.03
18 IDBI 82.78 -65.54 102.55 -100.84 501.00 28.14 100.14 12.29 5.00 1.02
TATAM
19 183.28 -205.04 106.44 -113.68 516.00 27.52 100.18 12.75 5.15 0.94
TDVR
MANAP
20 78.82 -41.99 155.88 -189.42 442.00 28.96 100.18 18.67 4.41 0.82
PURAM
ICICIPR
21 79.53 -109.33 23.18 -28.31 156.00 26.92 31.20 8.92 5.00 0.82
ULI
22 IDEA 21.60 -87.95 69.30 -107.40 508.00 27.17 100.14 8.30 5.07 0.65
23 INDIGO 311.11 -525.47 30.08 -47.04 209.00 29.67 41.85 8.62 4.99 0.64
JUSTDI
24 1251.40 -829.32 104.27 -164.47 379.00 25.86 71.08 17.60 5.33 0.63
AL
EICHER
25 22543.20 -6296.80 71.30 -123.20 515.00 26.60 100.14 8.54 5.14 0.58
MOTOR
RAYMO
26 420.51 -550.68 76.65 -143.97 543.00 27.62 100.18 9.18 5.42 0.53
ND
MARUT
27 3073.89 -2837.31 29.28 -71.05 524.00 25.19 97.15 3.62 5.39 0.41
I
IBULHS
28 332.53 -631.60 0.63 -105.82 389.00 25.45 69.47 0.11 5.60 0.01
G
FEDER
29 AL -27.25 -46.74 -2.91 -69.76 505.00 26.73 97.15 -0.36 5.20 -0.04
BANK
30 BEL -97.21 -168.85 -17.76 -131.66 475.00 25.26 97.15 -2.19 4.89 -0.13
BAJAJFI
31 1132.90 -2291.68 -24.89 -120.57 524.00 25.76 100.14 -2.98 5.23 -0.21
NSV
MUTHO
32 -567.7 -783.86 -54.72 -248.13 515.00 24.85 96.03 -6.84 5.36 -0.22
OTFIN
NATIO
33 NALAL -29.37 -60.01 -32.60 -108.54 452.00 27.21 100.18 -3.91 4.51 -0.30
UM
34 PFC -78.72 -131.29 -44.31 -142.75 586.00 24.40 97.15 -5.47 6.03 -0.31
35 SUNTV -474.09 -769.25 -56.20 -174.62 561.00 25.85 100.18 -6.73 5.60 -0.32
40
MINDT
36 75.79 -398.34 -38.86 -112.36 514.00 23.93 97.15 -4.80 5.29 -0.35
REE
HEXAW
37 -363.60 -540.94 -79.05 -201.33 522.00 25.67 97.15 -9.76 5.37 -0.39
ARE
38 DISHTV -110.69 -160.33 -78.28 -193.34 553.00 26.76 100.14 -9.38 5.52 -0.40
39 STAR -527.08 -952.96 -69.57 -150.00 562.00 23.13 100.18 -8.33 5.61 -0.46
BALKRI
40 354.75 -384.75 -83.68 -164.97 523.00 22.37 100.14 -10.03 5.22 -0.51
SIND
ULTRA
41 -734.61 -2454.23 -49.31 -96.50 543.00 24.49 100.18 -5.91 5.42 -0.51
CEMCO
42 TCS -297.81 -1062.62 -72.20 -133.47 560.00 25.36 100.18 -8.65 5.59 -0.54
43 MGL -691.99 -995.74 -68.56 -119.12 214.00 16.36 34.13 -24.11 6.27 -0.58
RELIAN
44 -367.45 -560.94 -73.21 -116.94 609.00 24.96 100.18 -8.77 6.08 -0.63
CE
BOSCH -
45 -4181.32 -105.95 -169.09 558.00 22.94 100.14 -12.70 5.57 -0.63
L TD 12604.97
CASTR
46 -107.00 -157.36 -54.19 -85.03 339.00 24.19 61.68 -10.54 5.50 -0.64
OL
HEROM
47 -3685.30 -5048.12 -134.49 -195.52 589.00 24.79 100.14 -16.12 5.88 -0.69
OTO
RBLBA
48 -262.49 -318.22 -44.84 -63.30 188.00 21.28 32.19 -16.72 5.84 -0.71
NK
49 NMDC -114.41 -170.84 -113.51 -159.38 541.00 23.11 97.15 -14.02 5.57 -0.71
50 PEL -902.65 -1773.87 -168.94 -231.83 575.00 22.26 97.15 -20.87 5.92 -0.73
51 BPCL -335.72 -405.21 -116.61 -157.01 592.00 24.66 100.14 -13.97 5.91 -0.74
BANKB
52 -303.60 -370.25 -179.49 -231.15 618.00 23.14 100.14 -21.51 6.17 -0.78
ARODA
HAVEL
53 -508.63 -547.92 -109.47 -139.14 549.00 25.50 100.14 -13.12 5.48 -0.79
LS
BHARA
54 TFORG -838.43 -1003.74 -161.28 -204.51 578.00 25.26 97.15 -19.92 5.95 -0.79
E
ENGINE
55 -163.81 -180.44 -127.70 -161.78 544.00 24.45 100.14 -15.30 5.43 -0.79
RSIND
41
GMRIN
56 -21.07 -28.87 -105.49 -131.81 483.00 27.12 100.14 -12.64 4.82 -0.80
FRA
NESTLE
57 -5666.82 -6373.04 -104.51 -130.40 528.00 23.30 100.18 -12.52 5.27 -0.80
IND
BIOCO
58 -354.57 -370.53 -178.09 -222.09 564.00 23.40 100.14 -21.34 5.63 -0.80
N
59 PVR -1513.86 -1650.81 -181.52 -226.34 559.00 24.33 100.18 -21.74 5.58 -0.80
DRREA
60 -1262.15 -3232.56 -146.01 -178.20 579.00 22.63 97.15 -18.03 5.96 -0.82
DY
ASIAN
61 -983.17 -1133.27 -107.33 -130.75 548.00 21.53 97.15 -13.26 5.64 -0.82
PAINTS
TORNT
62 -338.29 -379.10 -132.32 -160.70 578.00 25.09 100.18 -15.85 5.77 -0.82
POWER
ICICIBA
63 -419.05 -449.95 -127.31 -153.28 590.00 25.08 97.15 -15.73 6.07 -0.83
NK
64 LUPIN -949.95 -1414.36 -148.23 -176.87 593.00 22.60 97.15 -18.31 6.10 -0.84
PAGEIN -
65 -12701.37 -157.04 -186.13 598.00 22.41 100.18 -18.81 5.97 -0.84
D 16378.21
NIITTE
66 -1836.31 -1934.66 -298.66 -353.59 602.00 20.10 97.15 -36.89 6.20 -0.84
CH
RAMCO
67 -1049.42 -1090.87 -208.07 -245.79 603.00 21.72 100.18 -24.92 6.02 -0.85
CEM
SHREE -
68 -24490.41 -224.44 -262.07 540.00 23.15 100.18 -26.89 5.39 -0.86
CEM 27517.57
EQUITA
69 -158.91 -184.77 -123.62 -143.89 211.00 24.17 36.49 -40.65 5.78 -0.86
S
70 UBL -1513.37 -1690.29 -183.10 -206.74 587.00 20.78 100.18 -21.93 5.86 -0.89
EXIDEI
71 -369.96 -420.01 -237.57 -267.36 609.00 24.47 100.14 -28.47 6.08 -0.89
ND
TATAC
72 -766.21 -859.87 -202.09 -224.89 599.00 22.20 100.18 -24.21 5.98 -0.90
HEM
PIDILIT
73 -1088.02 -1182.92 -169.48 -188.28 582.00 22.68 100.18 -20.30 5.81 -0.90
IND
74 MOTHE -330.32 -367.15 -244.78 -270.85 561.00 25.31 100.18 -29.32 5.60 -0.90
42
RSUMI
DIVISL
75 -2151.63 -2232.50 -226.68 -248.37 641.00 22.31 100.14 -27.16 6.40 -0.91
AB
NIFTYI -
76 -11350.01 -116.60 -127.42 568.00 22.71 93.99 -14.89 6.04 -0.92
T 12196.67
BAJAJ
77 -4367.95 -4746.05 -207.58 -226.65 580.00 24.83 97.15 -25.64 5.97 -0.92
AUTO
ADANIP
78 -615.57 -637.98 -196.72 -211.57 618.00 25.40 100.14 -23.57 6.17 -0.93
ORTS
CHOLA
79 -2171.94 -2393.14 -371.51 -398.12 623.00 20.06 100.14 -44.52 6.22 -0.93
FIN
80 ONGC -346.24 -364.87 -199.63 -213.39 582.00 24.23 100.18 -23.91 5.81 -0.94
TVSMO
81 -519.54 -572.45 -153.28 -163.73 533.00 24.02 97.15 -18.93 5.49 -0.94
TOR
M&MFI
82 -434.24 -517.06 -144.76 -154.18 587.00 24.70 100.18 -17.34 5.86 -0.94
N
83 BSOFT -169.21 -171.77 -219.99 -234.21 542.00 23.99 100.14 -26.36 5.41 -0.94
84 DABUR -669.28 -717.97 -317.83 -337.50 644.00 19.88 100.14 -38.09 6.43 -0.94
85 ZEEL -1498.69 -1615.25 -449.73 -477.40 687.00 20.96 100.18 -53.87 6.86 -0.94
TATAG
86 -350.50 -361.94 -213.97 -226.91 627.00 23.92 100.18 -25.63 6.26 -0.94
LOBAL
87 ACC -3243.76 -3383.17 -235.79 -248.52 645.00 21.55 97.15 -29.12 6.64 -0.95
BRITAN
88 -1618.08 -1822.17 -172.25 -180.50 560.00 23.39 97.15 -21.28 5.76 -0.95
NIA
89 WIPRO -546.24 -579.69 -294.43 -308.08 584.00 20.89 100.18 -35.27 5.83 -0.96
90 OFSS -8657.33 -8860.03 -271.36 -282.89 568.00 20.95 97.15 -33.52 5.85 -0.96
HINDPE
91 -280.40 -294.09 -157.40 -163.22 590.00 23.39 100.14 -18.86 5.89 -0.96
TRO
92 ITC -611.96 -622.33 -270.49 -280.46 650.00 21.69 100.18 -32.40 6.49 -0.96
BERGE
93 -435.34 -462.62 -196.00 -203.15 572.00 20.63 100.14 -23.49 5.71 -0.96
RPAINT
TATAP
94 -199.40 -206.47 -225.61 -231.94 568.00 22.01 100.18 -27.03 5.67 -0.97
OWER
95 GODRE -1425.47 -1443.16 -439.71 -451.47 631.00 22.03 100.14 -52.69 6.30 -0.97
43
JCP
TORNT
96 -3263.31 -3385.66 -362.27 -370.78 604.00 22.52 100.18 -43.40 6.03 -0.98
PHARM
SUNPH
97 -962.18 -1001.13 -256.86 -262.16 629.00 21.46 100.18 -30.77 6.28 -0.98
ARMA
98 HDFC -3461.5 -3499.12 -304.66 -310.77 698.00 22.06 100.14 -36.51 6.97 -0.98
99 CIPLA -1326.78 -1343.82 -278.56 -283.78 656.00 19.51 100.14 -33.38 6.55 -0.98
MARIC
100 -1164.34 -1169.73 -597.33 -607.59 694.00 16.57 100.18 -71.55 6.93 -0.98
O
101 OIL -580.80 -589.21 -309.46 -314.73 571.00 21.02 100.18 -37.07 5.70 -0.98
CUMMI
102 -2590.48 -2631.50 -391.76 -396.44 622.00 19.45 97.15 -48.39 6.40 -0.99
NSIND
103 NTPC -460.00 -460.74 -351.62 -355.60 690.00 19.71 100.18 -42.12 6.89 -0.99
BHARTI
104 -616.34 -629.31 -189.71 -191.56 595.00 23.70 100.14 -22.73 5.94 -0.99
ARTL
CADILA
105 -765.67 -769.77 -287.90 -290.64 559.00 24.69 100.14 -34.50 5.58 -0.99
HC
AMBUJ
106 -608.48 -612.12 -287.20 -289.74 635.00 24.09 100.14 -34.41 6.34 -0.99
ACEM
HINDZI
107 -472.04 -478.33 -375.00 -378.11 607.00 21.75 100.14 -44.94 6.06 -0.99
NC
HCL
108 -1864.09 -1868.34 -266.31 -267.47 620.00 21.61 97.15 -32.89 6.38 -1.00
TECH
109 IOC -282.26 -282.26 -230.19 -230.92 554.00 22.02 100.18 -27.57 5.53 -1.00
POWER
110 -622.47 -624.42 -446.60 -447.56 716.00 17.74 100.18 -53.50 7.15 -1.00
GRID
111 IGL -320.56 -320.81 -306.54 -306.98 574.00 22.47 100.14 -36.73 5.73 -1.00
112 INFY -1028.45 -1030.02 -223.15 -223.33 585.00 24.96 100.14 -26.74 5.84 -1.00
AMARA
113 -1178.74 -1350.63 -197.21 -197.30 581.00 24.61 100.14 -23.63 5.80 -1.00
JABAT
APOLL
114 -3269.20 -3269.41 -345.64 -345.69 640.00 22.81 100.14 -41.42 6.39 -1.00
OHOS
COALIN
115 -713.14 -713.14 -311.87 -311.87 623.00 22.79 100.14 -37.37 6.22 -1.00
D
44
COLPA
116 -1914.46 -1935.02 -213.23 -213.23 601.00 21.13 100.14 -25.55 6.00 -1.00
L
CONCO
117 -1515.34 -1515.34 -420.31 -420.31 622.00 19.29 100.14 -50.37 6.21 -1.00
R
GLENM
118 -1290.44 -1290.44 -245.55 -245.55 603.00 23.55 100.14 -29.42 6.02 -1.00
ARK
HDFCB
119 -3098.26 -3098.26 -330.49 -330.49 667.00 17.84 100.14 -39.60 6.66 -1.00
ANK
INFRAT
120 -1363.46 -1363.46 -452.43 -452.43 518.00 18.15 76.21 -71.24 6.80 -1.00
EL
121 MFSL -924.15 -924.15 -238.87 -238.87 567.00 22.05 100.18 -28.61 5.66 -1.00
TABLE 3 – ANALYSIS OF SCRIPS ON EMA 50 HIGH/LOW STRATEGY
CONCLUSION:
The summary of this strategy concludes that PNL % of most companies is profitable
and proves to be good for future trading on this strategy but the PNL % is affected by
the DD % so we have calculated PNL/DD ratio. This ratio shows for each DD% how
much profit% the scrip has; it helps to know how effective the profitable scrip is for
trading. For example as we can see that the profit% of scrip MRF is more than the
scrip IDFCFIRST so anyone in first instance would choose MRF but at the same time
the DD% of MRF is more than IDFCFIRST so the PNL/DD ratio of MRF comes
down making it less profitable compared to IDFCFIRST. The greater the PNL/DD
ratio of any scrip is good for trading in that scrip.
On the basis of this ratio we have shortlisted top 7 scrips which are highlighted in
bold. The PNL/DD ratio of these scrips is good so they are being selected. From this 7
scrips year wise data have been checked and 5 scrips are selected which can be traded
in the future
The year wise summary of 5 selected scrips is shown below.
45
YEAR WISE SUMMARY OF SELECTED 5 SCRIPS

PNB ESCORTS MRF DHFL UNIONBANK
Year PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS
2011 -15.02 -23.07 51.55 65.09 14.08 665.13 -48.52 -50.13 -18.09 -52.90
2012 96.56 142.71 5.90 5.83 -29.35 -3162.46 25.76 22.67 74.72 114.55
2013 9.89 -0.07 56.74 43.70 79.29 8571.64 16.80 8.38 -45.64 -64.69
2014 -10.73 -52.00 -11.50 -19.20 33.99 6612.50 29.96 20.71 40.51 39.16
2015 21.60 48.89 4.05 -0.29 27.66 8282.18 6.90 12.99 64.49 119.12
2016 120.92 114.44 68.36 133.45 67.13 25498.66 69.15 175.18 -8.21 -7.15
2017 65.92 93.46 38.53 148.88 11.19 6040.03 35.45 61.15 25.85 28.19
2018 24.74 56.84 19.38 129.91 2.84 2223.61 45.28 232.10 25.09 26.49
2019 20.50 12.99 5.05 26.50 -5.23 -2439.31 48.78 124.77 48.02 35.91
TABLE 4 – YEAR WISE SUMMARY OF SELECTED SCRIPS
6.4 STRATEGY 4: SUM OF AVERAGE TRADE HIGH/LOW

This strategy is almost same as the previous strategy of sum of average trade in which
two moving averages were there short and long but as in that PNL % was in loss, the
rules of the strategy has been changed.
If Avg. Short > Avg. Long then buy the script if only it crosses the high of Avg.
Short
If Avg. Short < Avg. Long then sell the script if only it crosses the low of Avg.
Short
RULE:
 Buy when high Price is crossed of short average of particular candle when buy
alert is triggered
 Sell when Low price is crossed of short average of particular candle when sell
alert is triggered
ANALYSIS:
In this strategy also Average Short: (EMA 3 + EMA 5 + EMA 8 + EMA 13 + EMA
21) / 5
46
Average Long: (EMA 34 + EMA 59 + EMA 89) /3 has been used and the time frame
is 30 min chart. Usually when short average is above the long average the buy signal
is there but according to this strategy when short average comes above the long
average then if it crosses the high price of short avg then only buy signal is there and
same for the sell signal if low of short avg is crossed then only sell signal is triggered.
This strategy has been back tested on 121 scrips and their PNL % and DD% has been
calculated
SUMMARY OF STRATEGY SUM OF AVERAGE TRADE HIGH/LOW

DURATION – 2011 to 2019 COST – 0.20 %
TRA
TRAD Month PNL% DES PNL/D
NO. Name PNL DD PTS PNL% DD% PROB
ES s /Year /MO D
NTH
1 PNB 417.71 -88.19 369.08 -45.24 425.00 29.41 100.18 44.21 4.24 8.16
MCDOW
2 781.53 -182.19 257.98 -31.77 424.00 33.02 97.15 31.87 4.36 8.12
ELL-N
3 ESCORTS 767.37 -268.93 302.65 -47.86 418.00 32.54 100.14 36.27 4.17 6.32
51411.0
4 MRF -14903.2 224.57 -36.98 426.00 33.57 100.18 26.90 4.25 6.07
2
IDFCFIR
5 71.89 -13.57 141.48 -23.93 155.00 38.06 41.92 40.50 3.70 5.91
STB
6 NBCC 80.84 -54.16 264.90 -47.75 308.00 31.82 84.66 37.55 3.64 5.55
BHARAT
7 802.65 -788.49 371.55 -75.75 425.00 33.18 100.14 44.52 4.24 4.90
FIN
UNIONBA
8 306.18 -115.32 254.19 -55.71 460.00 31.52 100.18 30.45 4.59 4.56
NK
9 UJJIVAN 342.47 -93.04 120.05 -27.56 161.00 29.81 35.90 40.13 4.48 4.36
10 IDBI 122.17 -29.90 166.38 -43.37 430.00 32.09 100.14 19.94 4.29 3.84
11 DHFL 639.17 -232.93 233.19 -76.40 420.00 29.76 100.14 27.94 4.19 3.05
JUBLFOO
12 570.49 -685.25 137.94 -53.02 449.00 33.18 100.18 16.52 4.48 2.60
D
EICHERM 15194.6 -
13 109.39 -42.91 446.00 29.82 100.14 13.11 4.45 2.55
OTOR 9 11566.23
47
BAJFINA
14 929.15 -684.95 94.32 -39.19 424.00 31.60 97.15 11.65 4.36 2.41
NCE
KAJARIA
15 583.03 -265.41 152.92 -64.10 428.00 30.37 100.18 18.32 4.27 2.39
CER
16 MARUTI 3770.59 -3320.26 98.86 -44.61 451.00 29.05 97.15 12.21 4.64 2.22
17 CEATLTD 1341.02 -531.77 238.41 -111.71 437.00 30.21 100.14 28.57 4.36 2.13
18 L&TFH 87.52 -39.28 97.98 -51.37 389.00 30.85 92.78 12.67 4.19 1.91
19 INDIGO 701.15 -470.24 73.20 -49.25 185.00 28.11 41.85 20.99 4.42 1.49
20 IBULHSG 764.25 -280.45 97.01 -65.34 318.00 31.76 69.47 16.76 4.58 1.48
ENGINER
21 34.31 -74.23 83.46 -62.30 419.00 30.55 100.14 10.00 4.18 1.34
SIND
MANAPP
22 86.89 -46.80 202.57 -160.29 394.00 32.99 100.18 24.27 3.93 1.26
URAM
23 MCX 857.33 -843.95 139.47 -110.71 352.00 28.98 85.91 19.48 4.10 1.26
BANKIND
24 124.61 -147.57 94.71 -104.47 465.00 27.96 100.14 11.35 4.64 0.91
IA
GMRINFR
25 12.80 -23.01 53.80 -77.68 394.00 31.22 100.14 6.45 3.93 0.69
A
TATAMT
26 46.70 -263.94 80.65 -117.99 459.00 30.50 100.18 9.66 4.58 0.68
DVR
27 DISHTV -12.15 -75.32 63.44 -95.85 443.00 33.63 100.14 7.60 4.42 0.66
BAJAJFIN
28 1944.23 -2166.24 62.37 -99.13 414.00 30.92 100.14 7.47 4.13 0.63
SV
RAYMON
29 398.50 -605.68 72.41 -138.56 454.00 29.30 100.18 8.67 4.53 0.52
D
30 PFC 19.81 -64.23 36.45 -73.48 474.00 29.54 97.15 4.50 4.88 0.50
31 JUSTDIAL 1817.98 -1127.40 106.90 -234.08 317.00 28.08 71.08 18.05 4.46 0.46
32 PAGEIND 3539.71 -7471.99 12.91 -100.67 449.00 30.07 100.18 1.55 4.48 0.13
33 BEL -52.81 -163.52 12.49 -132.88 405.00 28.15 97.15 1.54 4.17 0.09
MUTHOO
34 -306.21 -503.44 13.25 -178.62 431.00 28.54 96.03 1.66 4.49 0.07
TFIN
RAMCOC
35 -352.87 -564.52 0.24 -95.85 461.00 27.11 100.18 0.03 4.60 0.00
EM
36 MINDTRE 160.92 -346.33 -2.15 -103.14 425.00 27.53 97.15 -0.27 4.37 -0.02
48
E
37 IDEA -16.01 -90.19 -8.61 -124.16 452.00 30.53 100.14 -1.03 4.51 -0.07
ULTRACE
38 -422.19 -3105.78 -24.43 -89.66 481.00 28.27 100.18 -2.93 4.80 -0.27
MCO
BOSCHL -
39 1434.86 -32.86 -107.71 449.00 28.73 100.14 -3.94 4.48 -0.31
TD 10496.95
HEROMO -
40 -2720.24 -33.69 -108.18 463.00 31.53 100.14 -4.04 4.62 -0.31
TO 1179.36
NATIONA
41 -36.27 -59.63 -34.06 -98.29 401.00 31.17 100.18 -4.08 4.00 -0.35
LALUM
42 PEL 427.51 -1741.75 -73.59 -205.41 459.00 27.02 97.15 -9.09 4.72 -0.36
43 CASTROL -42.02 -96.62 -21.69 -53.53 277.00 28.52 61.68 -4.22 4.49 -0.41
RELIANC
44 -213.46 -656.32 -63.95 -140.52 513.00 27.88 100.18 -7.66 5.12 -0.46
E
FEDERAL
45 -47.01 -71.10 -40.88 -88.11 441.00 31.52 97.15 -5.05 4.54 -0.46
BANK
BANKBA
46 -166.90 -265.33 -79.27 -170.24 507.00 26.82 100.14 -9.50 5.06 -0.47
RODA
ASIANPAI
47 -372.53 -702.45 -34.78 -72.32 452.00 23.45 97.15 -4.30 4.65 -0.48
NT
48 STAR -524.61 -794.18 -64.04 -122.96 467.00 27.41 100.18 -7.67 4.66 -0.52
TORNTPO
49 -196.97 -259.49 -86.57 -162.82 470.00 31.06 100.18 -10.37 4.69 -0.53
WER
50 EQUITAS -57.67 -113.61 -58.82 -100.57 170.00 29.41 36.49 -19.34 4.66 -0.58
51 NMDC -66.29 -123.45 -68.91 -117.20 448.00 28.79 97.15 -8.51 4.61 -0.59
ICICIPRU
52 -65.04 -109.44 -19.91 -32.55 163.00 29.45 31.20 -7.66 5.22 -0.61
LI
HEXAWA
53 -332.65 -434.92 -90.27 -147.00 441.00 28.80 97.15 -11.15 4.54 -0.61
RE
54 PVR -847.62 -1183.98 -77.55 -125.63 428.00 32.01 100.18 -9.29 4.27 -0.62
BALKRISI
55 199.07 -438.85 -100.58 -158.88 450.00 25.11 100.14 -12.05 4.49 -0.63
ND
SHREECE - -
56 -130.84 -196.76 423.00 29.31 100.18 -15.67 4.22 -0.66
M 18277.6 24548.83
49
0
57 HAVELLS -202.56 -351.87 -64.26 -94.55 456.00 29.39 100.14 -7.70 4.55 -0.68
NESTLEI -
58 -5592.50 -85.54 -124.24 484.00 26.45 100.18 -10.25 4.83 -0.69
ND 4962.97
59 MGL -704.90 -904.88 -71.07 -102.97 189.00 20.11 34.13 -24.99 5.54 -0.69
MOTHER
60 -213.66 -258.88 -115.21 -163.89 439.00 30.07 100.18 -13.80 4.38 -0.70
SUMI
BHARATF
61 -501.64 -725.06 -108.19 -150.34 476.00 28.99 97.15 -13.36 4.90 -0.72
ORGE
BRITANN
62 -641.59 -1090.50 -82.24 -112.69 456.00 28.07 97.15 -10.16 4.69 -0.73
IA
DRREDD -
63 -3114.67 -123.28 -168.79 513.00 24.76 97.15 -15.23 5.28 -0.73
Y 1054.49
PIDILITIN
64 -722.00 -862.75 -102.13 -138.72 468.00 27.14 100.18 -12.23 4.67 -0.74
D
65 SUNTV -606.43 -749.02 -133.50 -178.50 470.00 27.02 100.18 -15.99 4.69 -0.75
AMARAJ
66 -784.96 -1156.78 -104.01 -136.52 465.00 30.75 100.14 -12.46 4.64 -0.76
A
67 UBL -593.08 -824.47 -68.33 -85.33 484.00 23.97 100.18 -8.19 4.83 -0.80
68 TCS -680.54 -977.77 -101.92 -126.68 503.00 28.23 100.18 -12.21 5.02 -0.80
-
69 NIITTECH -2054.78 -272.73 -336.98 518.00 20.85 97.15 -33.69 5.33 -0.81
1941.00
70 BPCL -442.32 -504.93 -125.06 -154.40 498.00 29.12 100.14 -14.99 4.97 -0.81
RBLBAN
71 -315.00 -370.81 -52.22 -64.02 165.00 24.85 32.19 -19.47 5.13 -0.82
K
BAJAJ- -
72 -2367.10 -97.28 -118.49 459.00 30.28 97.15 -12.02 4.72 -0.82
AUTO 1849.02
TATACHE
73 -491.14 -596.95 -159.65 -189.89 493.00 25.35 100.18 -19.12 4.92 -0.84
M
-
74 NIFTYIT -7129.31 -66.76 -79.41 468.00 27.14 93.99 -8.52 4.98 -0.84
6529.87
75 M&MFIN -454.90 -553.64 -145.18 -167.41 486.00 27.78 100.18 -17.39 4.85 -0.87
CHOLAFI -
76 -1571.40 -240.92 -277.10 486.00 25.10 100.14 -28.87 4.85 -0.87
N 1296.29
50
77 BIOCON -398.79 -413.05 -192.71 -219.65 509.00 24.56 100.14 -23.09 5.08 -0.88
78 LUPIN -832.47 -1239.79 -139.00 -157.98 494.00 24.29 97.15 -17.17 5.08 -0.88
-
79 ACC -2048.63 -140.49 -159.22 502.00 25.70 97.15 -17.35 5.17 -0.88
1750.09
-
80 DIVISLAB -1772.75 -176.18 -198.19 522.00 24.52 100.14 -21.11 5.21 -0.89
1695.08
81 BSOFT -134.68 -149.11 -141.42 -158.92 475.00 27.58 100.14 -16.95 4.74 -0.89
ADANIPO
82 -419.09 -464.62 -160.28 -177.28 518.00 28.38 100.14 -19.21 5.17 -0.90
RTS
BERGERP
83 -412.46 -462.75 -166.91 -183.80 488.00 25.82 100.14 -20.00 4.87 -0.91
AINT
EXIDEIN
84 -445.72 -501.68 -292.14 -319.54 508.00 26.38 100.14 -35.01 5.07 -0.91
D
HINDPET
85 -461.24 -489.97 -226.58 -245.00 486.00 27.16 100.14 -27.15 4.85 -0.92
RO
86 IOC -238.76 -245.45 -180.65 -194.44 480.00 26.67 100.18 -21.64 4.79 -0.93
-
87 ZEEL -1533.70 -425.15 -457.34 571.00 23.82 100.18 -50.93 5.70 -0.93
1397.63
88 WIPRO -361.19 -390.08 -191.51 -202.56 481.00 24.32 100.18 -22.94 4.80 -0.95
89 ONGC -343.70 -356.82 -204.76 -215.33 482.00 26.14 100.18 -24.53 4.81 -0.95
CUMMIN -
90 -1579.67 -240.77 -252.37 490.00 23.67 97.15 -29.74 5.04 -0.95
SIND 1507.26
AMBUJA
91 -345.95 -361.28 -184.83 -193.72 505.00 28.51 100.14 -22.15 5.04 -0.95
CEM
-
92 OFSS -5888.47 -189.16 -197.67 454.00 24.89 97.15 -23.37 4.67 -0.96
5722.77
GODREJC -
93 -1283.87 -356.08 -369.53 537.00 26.44 100.14 -42.67 5.36 -0.96
P 1252.18
TVSMOT
94 -263.37 -310.73 -124.99 -129.47 450.00 27.78 97.15 -15.44 4.63 -0.97
OR
95 MARICO -993.01 -1001.91 -487.07 -503.33 548.00 19.89 100.18 -58.35 5.47 -0.97
96 DABUR -589.45 -609.43 -276.86 -284.47 542.00 24.91 100.14 -33.18 5.41 -0.97
TATAPO
97 -145.43 -150.61 -166.04 -170.34 465.00 26.88 100.18 -19.89 4.64 -0.97
WER
51
98 ITC -651.88 -657.55 -290.65 -296.46 546.00 23.08 100.18 -34.82 5.45 -0.98
99 CONCOR -947.88 -966.79 -263.14 -268.04 458.00 25.98 100.14 -31.53 4.57 -0.98
-
100 HDFC -3362.14 -314.57 -320.42 556.00 23.02 100.14 -37.69 5.55 -0.98
3325.25
HINDZIN
101 -365.13 -375.57 -270.97 -275.42 497.00 27.16 100.14 -32.47 4.96 -0.98
C
CADILAH
102 -494.50 -499.59 -204.59 -207.93 472.00 26.69 100.14 -24.52 4.71 -0.98
C
103 INFY -1144.6 -1167.38 -255.17 -258.95 533.00 24.77 100.14 -30.58 5.32 -0.99
-
104 CIPLA -1189.03 -252.23 -255.61 516.00 22.09 100.14 -30.22 5.15 -0.99
1179.95
105 COALIND -675.76 -680.97 -290.84 -293.25 524.00 25.76 100.14 -34.85 5.23 -0.99
POWERG
106 -641.28 -644.51 -452.00 -454.70 593.00 19.39 100.18 -54.14 5.92 -0.99
RID
TORNTPH -
107 -2776.26 -348.88 -350.45 513.00 22.42 100.18 -41.79 5.12 -1.00
ARM 2752.01
108 OIL -561.99 -563.83 -310.24 -311.35 494.00 24.29 100.18 -37.16 4.93 -1.00
SUNPHAR
109 -660.25 -812.11 -203.75 -204.37 520.00 25.58 100.18 -24.41 5.19 -1.00
MA
110 NTPC -362.43 -363.16 -271.27 -271.78 540.00 23.52 100.18 -32.50 5.39 -1.00
APOLLOH -
111 -2702.23 -282.15 -282.35 519.00 27.94 100.14 -33.81 5.18 -1.00
OS 2702.23
BHARTIA
112 -417.25 -433.46 -137.92 -137.92 505.00 27.13 100.14 -16.53 5.04 -1.00
RTL
113 COLPAL -1787.5 -1844.15 -201.99 -201.99 513.00 23.59 100.14 -24.20 5.12 -1.00
GLENMA
114 -945.63 -945.63 -173.96 -173.96 493.00 26.57 100.14 -20.85 4.92 -1.00
RK
-
115 HCLTECH -1967.70 -258.07 -258.07 521.00 24.95 97.15 -31.88 5.36 -1.00
1909.11
HDFCBA
116 -3148.7 -3148.70 -326.55 -326.55 566.00 21.20 100.14 -39.13 5.65 -1.00
NK
ICICI
117 -346.30 -346.30 -149.25 -149.25 483.00 30.02 97.15 -18.44 4.97 -1.00
BANK
118 IGL -287.57 -287.57 -262.13 -262.13 498.00 26.10 100.14 -31.41 4.97 -1.00
52
INFRATE -
119 -1022.84 -333.95 -333.95 417.00 20.38 76.21 -52.58 5.47 -1.00
L 1022.84
120 MFSL -715.67 -726.40 -198.20 -198.20 471.00 27.39 100.18 -23.74 4.70 -1.00
TATAGL
121 -222.30 -222.96 -148.67 -148.67 483.00 27.54 100.18 -17.81 4.82 -1.00
OBAL
TABLE 5 – ANALYSIS OF SCRIPS ON SUM OF AVG TRAGE HIGH/LOW
STRAREGY
CONCLUSION:
The summary of this strategy has been arranged on the basis of PNL/DD ratio i.e. for
each DD% how much profit% the scrip has. The scrips having greater ratio have been
arranged on the top and as it can be observed that most of the companies are in
profitable position so the change in rules of the strategy have given good results. By
comparing the scrips on the basis of this ratio proves to be more effective by
comparing only the PNL%.
The top 7 scrips have been shortlisted on the basis of these ratios which are
highlighted in bold. From that year wise selection has been done of top 5 scrips on
which trading can be profitable in near future.
YEAR WISE SUMMARY OF SELECTED 5 SCRIPS

PNB ESCORTS MCDOWELL-N MRF BHARATFIN
Year PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS PNL% PNL PTS
2011 5.26 14.72 49.37 70.80 15.57 28.86 31.35 1786.75 140.98 536.74
2012 93.41 138.79 15.94 12.50 125.36 209.57 -11.49 -1719.23 69.85 65.49
2013 24.46 16.07 93.01 68.49 29.26 112.33 76.32 8199.92 63.26 82.13
2014 -8.86 -43.67 1.83 1.74 19.63 109.41 20.50 3188.05 44.96 94.60
2015 29.00 54.46 -10.11 -23.26 4.67 25.32 18.02 4455.96 21.22 106.42
2016 102.34 88.00 60.69 120.52 25.25 136.35 70.08 25219.28 59.19 377.20
2017 47.39 64.10 40.11 150.25 40.51 171.93 7.53 3026.02 34.70 199.06
2018 52.67 69.61 32.74 237.11 17.57 94.34 -1.24 -773.39 -22.19 -248.03
2019 23.43 15.62 19.07 129.24 -19.84 -106.58 13.49 8027.66 -40.43 -410.96
TABLE 6 - SUMMARY OF SELECTED SCRIPS
53
The selection from shortlisted scrips has been done on the basis of no. of years their
price data was available. As some scrips were listed after 2011 so their data was not
available and it would affect the ratio.
We have also founded in the back testing that the sum of average trade strategy is
more profitable than the EMA50 as sum average strategy has more profitable scrips.
6.5 STRATEGY 5: SHORT STRADDLE WEEKLY STRATEGY:

The strategy on which back testing has been done is based on the SHORT
STRADDLE. In this the reward is limited to the amount of premium. The amount of
premium is decided on the basis of three things – underlying value of that call or put,
the time value and volatility.
ANALYSIS:
The logic behind this strategy is that the time value of option decreases as they come
near to expiry date to take the advantage of that the short straddle has been used. In
this the call/put are sell on current day and buy the same call/ put on next day. As the
time value is decreased next day the premium will also reduce so to see that we can
the advantage of time value the back testing of this strategy has been done. In this the
strike price is based on ATM where spot price = strike price. In this the weekly expiry
is taken (every Thursday expiry is done).
Premium = intrinsic value + time value
Intrinsic value for call: spot price – strike price
Intrinsic value for put: strike price – spot price
SELL ATM CALL/PUT ON CURRENT DAY
BUY ATM CALL/PUT ON NEXT DAY
54
WEEKLY STRADDLE
STRATEGY
BANK NIFTY
PNL amount 4567.8
MAX DD -2416.65
PNL % 20.22754
DD % -9.21355
PROB 64.18919
3
DURATION
YEARS
TABLE 7 - SUMMARY OF BN ON WEEKLY STRADDLE STRATEGY
CONCLUSION:
The scrip BANK NIFTY has been back tested on this strategy from 2016 to 2019 and
it seems profitable as PNL % shows profit and the probability of profit is also 64
which is good sign so this strategy can be used for future trading. The concept of
margin was also explained to me during this strategy as the actual amount on which
trading is done in derivative market is on margin of actual amount which is 20%
margin. The PNL on margin was also calculated which was also profitable.
6.6 STRATEGY 6: SHORT STRADDLE MONTHLY STRATEGY

ANALYSIS:
This strategy is based on the same which is being back tested above. The logic is also
same that sell ATM call / put today and buy the same ATM call/ put next day. The
expiry period is changed as previously monthly expiry was used. So in this last
trading day of each month is used as the expiry date and is back tested to see whether
it is profitable or not.
55
MONTHLY
STRADDLE
STRATEGY
BANK NIFTY
PNL amount 263.64
MAX DD -1584.65
PNL % 1.220486
DD % -8.76317
DURATION 1 year
TABLE 8 - SUMMARY OF BN ON MONTHLY STRADDLE STRATEGY
CONCLUSION:
The index BANK NIFTY was been back tested on this strategy from 2015 to 2016
and as it is been seen that the PNL % is only 1.22 which is not profitable so this
strategy was being not back tested further.
56
CHAPTER 7
STUDY 2 - FUNDAMENTAL ANALYSIS ON
SELECTED COMPANIES OF NBFC
SECTOR
7.1 INTRODUCTION TO NBFCS IN INDIA

A Non Banking Financial Company (NBFC) is a company registered under the
Companies Act, 1956 of India, engaged in the business of loans and advances,
acquisition of shares, stock, bonds hire-purchase, insurance business or chit business
but does not include any institution whose principal business includes agriculture,
industrial activity or the sale, purchase or construction of immovable property.
The working and operations of NBFCs are regulated by the Reserve Bank of India
(RBI) within the framework of the [Reserve Bank of India Act, 1934] and the
directions issued by it. On November 9, 2017, Reserve Bank of India (RBI) issued a
notification outlining norms for outsourcing of functions/services by Non-Bank
Financial Institution (NBFCs).As per the new norms, NBFCs cannot outsource core
management functions like internal audit, and management of investment portfolio,
strategic and compliance functions for know your customer (KYC) norms and
sanction of loans. Staff of service providers should have access to customer
information only up to an extent which is required to perform the outsourced function.
Boards of NBFCs should approve a code of conduct for direct sales and recovery
agents. For debt collection, NBFCs and their outsourced agents should not resort to
intimidation or harassment of any kind. All NBFCs’ have been directed to set up
grievance redressal machinery, which will also deal with the issues relating to
services provided by the outsourced agency.
7.2 BRIEF ABOUT SELECTED COMPANIES

The NBFC sector has been classified into three broad segments and the corresponding
number of companies analyzed has been described below-
57
Housing Finance Companies: HFCs

Financial Services/ Investment companies: FS-I
Term Lending Companies: TLs
The companies analyzed under this study belong to Housing Finance Companies
(HFC). The companies have been selected on the basis of Market capitalization. The
top four companies based on Market cap are:
 Housing Development Finance Corporation (HDFC) housing finance
 LIC Housing Finance
 INDIABULLS Housing Finance
 PNB Housing Finance
58
CHAPTER 8
ANALYSIS OF COMPANIES
8.1 QUALITATIVE ANALYSIS OF INDIVIDUAL COMPANIES
HDFC (HOUSING DEVELOPMENT FINANCE CORPORATION):

MANAGEMENT:
The management team of any organization takes the strategic decisions which
determine the strength of the company. The management team of HDFC includes:
CEO – Mr. Keki Mistry
CFO – Mr. V. Srinivasa
Chairman – Mr. Deepak Parekh
Managing Director – Ms. Renu Karnad
The whole management team has a great knowledge of housing sector, economics,
financial services and is experienced in this industry. They have been the pillars of
this corporation since 35 to 40 years and helped in taking the crucial decisions. Mr.
Keki Mistry is also on the board of TATA Consultancy Services, Griha Investments
and others. This all indicate that the management of the company is strong enough to
face all the challenges and take the upcoming opportunities to be at the top in market
position. The long tenure of whole management team also indicates that shareholders
and board of directors are satisfied with their decisions.
BUSINESS MODEL:
The business model of any company shows how its activities are profitable and
generates revenue from its products and services. HDFC is mainly involved in loan
disbursement through various schemes such Housing Loans, Home improvement
loans, Loan against property. Also HDFC has performed well with fixed deposits and
earned the trust of all depositors. It has received AAA rating for highest safety for 24
consecutive years.
To further increase the network and revenue, HDFC covers additional locations. It has
tie-ups with banks and other distribution companies including e – portals for retail
loans. Digital initiatives have been taken for ‘HDFCs online home loans’. Property
59
fairs across major cities in india is to be organized. Other initiatives such as ‘women
power’ housing product for women and ‘HDFC reach’ to tap the customers in
unorganized sector are to started.
This all indicates there will be growth in the loan disbursement by the HDFC despite
intense competition in the lending segment.
COMPETITION:
In Housing Finance market, HDFC has its prominent share for affordable housing
finance. Its major competitor in HFC can be LIC housing finance with almost equal
market share. It can also face competition from another growth emerging HFCs such
as Indiabulls, DHFL and GRUH finance. It can also face challenge while competing
with banks as they are also on the way to introduce innovative housing finance
products. In overall NBFCs there are many prominent players such as power finance,
bajaj finserv which can be competition in overall lending segment.
BRAND IMAGE:
The Brand HDFC has been well known in whole housing finance companies. HDFC’s
subsidiary companies have strong synergies with HDFC. This enables the Corporation
to provide property related value added services and cross sell products and services
under the ‘HDFC’ brand.
The overall analysis of HDFC shows that HDFC can perform well in near future if
they manage their stake in overall market by providing innovative products and
managing the AUM properly.
LIC HOUSING FINANCE:

The management team of LIC housing finances:
CEO – Shri Vinay sah
CFO - Mr. Sudipto sil
COO – Mr. Siddhartha Mohanty
CHAIRMAN – Shri V K Sharma
The whole management team has great experience in the banking sector, financial
services which will benefit the company but most of them have took in charge of this
position from 4 5 years only. So the investors and other shareholders would like to see
how their decisions are beneficial for the company.
60
The services offered by LIC as their business model are most of same as compared to
HDFC. But they have tried to capture the mortgage market more by providing loan
against securities and loan against property for companies. They have service
available as loan for builders/ developers. As this company continues to serve the
customers at door step through various agents, they have started club membership
programme to gain loyalty of corporate agents. To increase the revenue in future they
have planned to do effective marketing and conduct exhibitions at various places.
They have also used technology to enhance value such as introducing mobile apps,
online loans, and IT help desk and for future implementations of EDMS and e-KYCs
which can prove to be great initiative.
The biggest competition for LIC in housing Finance market cans HDFC which has
huge market share. But the market share of LIC is also increasing and proved to be in
top among housing finance market. HCFs can face a huge competition from banks
which can affect LIC growth.
The brand image of LIC is good as the company is involved in marketing efforts
which can be a great result for the company. As well as the having a portfolio of
brands such LIC life insurance and other subsidiaries can reduce the risk for overall
organization.
The above analysis shows that LICs marketing efforts will give great result and
increase the market share.
INDIABULLS HOUSING FINANCE:

The management team of Indiabulls involves:
VICE CHAIRMAN&CEO – Gagan Banga
COO – Sachin Chaudhary
CFO – Mukesh Garg
They all have experience in this industry for more than a decade and all are
committed with this organization for 10 to 15 years. So they understand the nature of
business and take effective decisions. Mr. Banga has a huge hand in shaping the
business strategy of the company. Mr. Sachin chaudhary has been successful in
establishing largest mortgage franchises and handling the operations.
61
INDIABULLS provides all services related to home loans but they have one unique
service of Home Loan Balance Transfer which attracts more customers. The company
has been growing since years to make its place in the NBFC industry. The future plan
for increasing revenues is based on e-home loans. Indiabulls is first among various
HFCs to provide online loan facility for that they have introduced e- home loans
mobile app. They have also started e-KYCs, PAN card verification and UPI system.
They have also launched in last year this e-enabling e-empowering and e-expanding
initiative. So the future target is to make available home loans to almost all customers
through digitalization.
The huge players of HFCs are HDFC and LIC being the two major competitors of
INDIABULLS. But the company is also growing rapidly to secure the market share
and gain more customers in the market through innovative products.
The brand image of INDIABULLS has been growing in the market as they have been
using online marketing sources and as their subsidiary companies are also well known
in the market they have good brand image.
PNB HOUSING FINANCE:

The management team of the company involves:
CEO – Mr. Sunil Mehta
CFO – Mr. Kapish Jain
COO- Sunil Kaul
MANAGING DIRECTOR – Mr. Sanjay Gupta
They all have been committed to company from 10 to 12 years so they have proved
that their strategic decisions have helped the organization.
The company believes that for future growth there should be sustainable business
model so they place productivity ahead of expansion. They have targeted retail market
and serve the customers through services such as loan for purchase of homes, lease
rental discounting and other similar services provided by most of housing finance
companies. They also provide ‘UNNATI’ home loans which is different concept from
others.
The company has maintained the brand image through different branding and
marketing campaigns such as their catch phrase ‘Surprisingly Easy’ and other TV ads
62
and other commercials. Still the brand image can get affected by subsidiary
companies as PNB scam came into picture.
PNB housing finance has low market share compared to top two HDFC and LIC but
the company is putting its efforts to increase the market share. There is much
competition in HFCs so PNB needs to make its own place and acquire the customers.
8.2 COMPARATIVE ANALYSIS OF COMPANIES THROUGH

RATIOS
The analysis involves different ratios based on liquidity, profitability and other
valuation ratios used by most of the investors to select the stocks. The ratios are
being calculated of all selected companies to know their financial performance. The
average of 5 years has been taken of selected companies to compare from each other
as to ascertain which is more financially stable and can give more returns in future.
 CURRENT RATIO
HDFC LIC INDIABULLS PNB
Mar-15 0.27 0.46 1.69 0.71
Mar-16 0.26 0.44 1.62 0.28
Mar-17 0.34 0.44 2.02 0.4
Mar-18 0.21 0.33 1.95 0.39
Mar-19 1.19 1.08 0.49 1.12
AVERAGE 0.454 0.55 1.554 0.58
Table 9 ANALYSIS OF CURRENT RATIO
63
CURRENT RATIO
2.5
2.02 1.95
2
1.69 1.62
1.5 HDFC
1.19 LIC
1.08 1.12
1 INDIABULLS
0.71
PNB
0.46 0.44 0.44 0.4 0.49
0.5 0.27 0.26 0.28 0.34 0.33 0.39
0.21
0
Mar-15 Mar-16 Mar-17 Mar-18 Mar-19
AVERAGE CURRENT RATIO (5 YEARS)

1.8
1.554
1.6
1.4
1.2
1
0.8 Series1
0.55 0.58
0.6 0.454
0.4
0.2
0
INTERPRETATION:
HDFC – As we can see that the current ratio of HDFC has been increased in 2019 as
compared to 2015 at high growth. As observed in the balance sheet of the company in
2019 changes was done in current assets and current liabilities as compared to
previous years. The short term provisions as CL was reduced to 0.00 in 2019 and even
the current investments and short term loans and advances given were increased in
2019.
LIC – the current ratio of LIC has grown almost more than 50% in 2019 as compared
to 2018 but still it needs to perform better. The balance sheet of the company shows
that the CA and CL of the company are not maintained properly as short term
provision has been 0.00 which is good sign but at the same time the short term
64
borrowings has been increased. While short term loans and advances has been
increased but the trade receivables has reduced to 0.00.
INDIABULLS – There can be seen a drastic decrease in the current ratio of the
company compared to previous years. In previous years the ratio being the highest of
all compared to other companies and even to the standard current ratio. The balance
sheet says that the company has increased its short term borrowings in 2019 but not
increased the investments and loans upto that level. The company needs to improve to
compete the industry giants and reach to the previous level again.
PNB – Current ratio of PNB has also increased at high growth compared to previous
years. The reason being the same that PNB has also decreased the short term
provisions to 0.00 and increased the short term loans and advances in 2019 so this
proves good for the company in terms of liquidity,
AVERAGE –It is being observed that despite indiallbulls ratio been lowest in 2019
the average of the company is highest compared to other companies it is because it
has performed well in previous years so to maintain this position they have to improve
their CA and CL so that liquidity position is also maintained.
 NET PROFIT MARGIN:

It shows how much profit the company gains through its sales.
Mar-15 21.86 12.99 31.66 11.03
Mar-16 22.95 13.39 28.91 12.1
Mar-17 23.17 13.8 28.33 13.4
Mar-18 34.94 13.29 29.19 15.05
Mar-19 22.22 14 24.2 14.45
AVERAGE 25.028 13.494 28.458 13.206
Table 10 ANALYSIS OF NET PROFIT MARGIN
65
NET PROFIT MARGIN

40
34.94
35 31.66
28.91 28.33 29.19
30
22.95 23.17 24.2 HDFC
25 21.86 22.22
20 LIC
13.8 13.4 15.05 14 14.45
15 12.99 13.39 12.1 13.29 INDIABULLS
11.03
10 PNB
5
0
AVERAGE OF NET PROFIT (5 YEARS)

30 28.458
25.028
25
20
15 13.494 13.206
Series1
10
5
0
INTERPRETATION:
HDFC –As it can be observed from the graph that the net profit margin of the
company was increasing slowly till 2017 then in 2018 there was sudden increase in
the ratio and in 2019 the ratio declined to previous point again. The profit & loss
statement of the company say that there was increase in the net sales in 2019
compared to 2018, even the operating profit was increased in 2019 but only the net
profit was decreased in 2019 compared to 2018 as there was increase in the interest
expenses and even depreciation expenses were increased which was the reason for
decline in the ratio in 2019.
LIC – The net profit margin is not much changed during the whole period of 2015 to
2019; it has been around 12 to 13%. The PNL statement shows that the net sales
having been increasing at slow pace every year with that operating profit has also
been increasing which means the company has maintained operational efficiency.
66
Even the net profit is increasing which means the interest expenses are also
maintained properly due to which the ratio has not declined but to compete with
others in same industry they have to increase the ratio.
INDIABULLS – The ratio of INDIABULLS has been highest in all years compared
to other companies. But if compared from 2015 to 2019 it has been decreased by more
than 5%. As per the PNL statement of the company both the net sales and net profit
are increasing but still the ratio has decreased that can be because in 2015 the net
income of the company is very high compared to its sales. It can be concluded that the
company has kept high price of its products which yield high income per sales but at
the end the sales of the company has decreased due to which the ratio has also
decreased in 2019.
PNB – The ratio of PNB has also not shown much change in 2019 compared to 2015.
There is increasing trend but still the company needs to work more in maintaining its
expenses to recover the ratio compared to others in same industry.
AVERAGE-The average of 5 years has been done for each company to compare
from each other and it can be clearly observed that the average of INDIABULLS is
highest as the company maintained the ratio well in previous years but at this point
HDFC will be preferable because as we can see the ratio of INDIABULLS is
decreasing in 2019 so it can further decrease so next highest average is of HDFC
 DEBT TO EQUITY
This is leverage ratio which measures the weight of total debt and financial liabilities
against the total shareholders’ equity.
Mar-15 4.23 10.64 6.03 9.2
Mar-16 4.42 10.51 4.65 11.23
Mar-17 4.85 10.05 5.86 5.74
Mar-18 3.53 9.42 6.78 8.03
Mar-19 4.72 10.37 5.57 9.66
AVERAGE 4.35 10.198 5.778 8.772
TABLE 11 ANALYSIS OF DEBT TO EQUITY RATIO
67
DEBT TO EQUITY
12 11.23
10.64 10.51 10.37
10.05 9.66
10 9.2 9.42
8.03
8 6.78 HDFC
6.03 5.86
5.74 5.57 LIC
6 4.85 4.72
4.23 4.42 4.65
3.53 INDIABULLS
4
PNB
2
0
Average of debt to equity (5 years)

12
10.198
10 8.772
8
5.778
6
4.35 Series1
4
0
INTERPRETATION:
HDFC- The ratio of this company is lowest compared to other three which means the
company prefers the financial growth less through debt and is more equity financed.
Also the long term borrowings have been declined to zero in 2019 which means the
debt is reduced so the ratio is also low.
LIC-The debt/equity ratio of LIC has not changed much from 2015 to 2019 but the
ratio is highest in all the years compared to other companies. This is not good sign for
the company as most of the net assets are being financed through debt instead of the
equity which involves high risk. It also indicates that company should have enough
cash flow to pay interest expenses.
INDIABULLS – The ratio of this company seems good as it not too high neither too
low compared to other companies. It has been around 5 to 6 in all years which means
68
the company has enough equity compared to the debt. It can be observed from
balance sheet that company has declined its long term provisions to zero in 2019.
PNB- The ratio of this company also seems very high as LIC housing finance. The
ratio was somewhat declined in 2018 but again increased in 2019 as the company’s
short term borrowing increased which increased the ratio.
AVERAGE – the average of HDFC seems to be lowest which seems good for the
company but investors can prefer INDIABULLS also who needs high earnings
through finance growth as the company has used good amount of debt and equity
which makes it perfect for selecting.
 ASSET TURNOVER RATIO:

This ratio indicates how effectively the firm is managing its assets to achieve good
amount of sales. It is expressed in times.
Mar-15 10.78 9.48 11.33 9.33
Mar-16 10.7 9.49 10.56 9.08
Mar-17 9.51 9.26 10 9.09
Mar-18 8.66 8.7 9.83 8.64
Mar-19 9.44 8.65 12.82 8.93
AVERAGE 9.818 9.116 10.908 9.014
TABLE 12 ANALYSIS OF ASSET TURNOVER RATIO
ASSET TURNOVER RATIO

14 12.82
12 11.33
10.78 10.7 10.56
9.48 9.33 9.49 9.08 9.51 10 9.83
10 9.26 9.09 9.44
8.668.7 8.64 8.65 8.93
HDFC
8
LIC
6
INDIABULLS
4
PNB
2
0
69
AVERAGE OF ASSET TURNOVER RATIO (5 YEARS)

12 10.908
9.818
10 9.116 9.014
6
Series1
4
0
INTERPRETATION:
HDFC- The asset turnover ratio of HDFC is good enough as not much change is seen
in the ratio from 2015 to 2019. The fixed asset turnover and debtors turnover ratio of
the company is maintained well which contributed to maintain the asset turnover ratio
LIC- The ratio of this company is slightly decreased in 2019 compared to 2015. As
per the ratio of the company the fixed asset and debtors are maintained properly so
problem may be in the inventories which should be reduced.
INDIABULLS- The ratio of this company is best compared to others which mean the
assets are properly balanced to achieve the sales. Both fixed assets and debtors
turnover have increased tremendously in 2019.
PNB- The ratio of PNB is also 8 to 9 times which is good for the company. But to
compete with others it has to increase the asset management and in 2019 the ratio has
decreased upto some extent.
AVERAGE: The average of INDIABULLS is highest which proves to be best
compared to others and manages the assets properly.
 INTEREST COVERAGE RATIO:

This ratio helps to determine how easily a company can pay interest on its outstanding
debt. It also shows that the operating income of the company is efficient to recover all
the interest expenses.
Mar-15 1.48 1.25 1.66 1.23
Mar-16 1.52 1.28 1.63 1.27
70
Mar-17
1.51 1.29 1.58 1.3
Mar-18
1.52 1.28 1.62 1.36
Mar-19
1.47 1.26 1.57 1.31
AVERAGE 1.5 1.272 1.612 1.294
TABLE 13ANALYSIS OF INTEREST COVERAGE RATIO
INTEREST COVERAGE RATIO

1.8 1.66 1.63 1.62
1.52 1.58 1.52 1.57
1.6 1.48 1.51 1.47
1.36
1.4 1.25 1.23 1.28 1.27 1.29 1.3 1.28 1.26 1.31
1.2 HDFC
1
LIC
0.8
INDIABULLS
0.6
PNB
0.4
0.2
0
AVERAGE OF INTEREST COVERAGE RATIO (5

YEARS)
1.8 1.612
1.6 1.5
1.4 1.272 1.294
1.2
1
0.8 Series1
0.6
0.4
0.2
0
INTERPRETATION:
HDFC – The ratio has remained stable as not change can be observed from 2015 to
2019. The ratio of all the companies has been around 1 to 2 times so HDFC has
enough earnings to pay its interest expenses. Even the debt ratio of the company was
low so it may face less difficulty to pay interest charges.
71
LIC- The ratio of LIC is slightly low compared to other companies as their debt ratio
was high so they have to pay interest expenses in huge amount. But the company
however managed to the operating income and from 2015 to 2019 the ratio has been
stable only despite increased borrowings.
INDIABULLS – The Company has good interest coverage ratio. As the debt ratio of
company was lowest they face less difficulty in paying interest expenses.
PNB – The ratio has increased from 2015 to 2019 which is good sign. Despite the
debt ratio increasing they have improved interest coverage ratio which means their
operating income has increased.
AVERAGE – the average of INDIABULLS is the highest so which shows the
company has efficient income to pay interest expenses.
 RETURN ON EQUITY:
This ratio is important from the point of view of stockholders as they expect return on
their money. This ratio shows the effectively the income is generated from
shareholders equity.
Mar-15 19.34 17.72 30.47 12.4
Mar-16 20.78 18.15 21.84 15.21
Mar-17 18.77 17.43 23.94 9.39
Mar-18 19.8 15.67 27.66 13.17
Mar-19 12.45 14.95 21.6 14.54
AVERAGE 18.228 16.784 25.102 12.942
TABLE 14ANALYSIS OF RETURN ON EQUITY
72
RETURN ON EQUITY
35
30.47
30 27.66
23.94
25
20.78 21.84 19.8
21.6
HDFC
19.34 18.15 18.77
20 17.72 17.43
15.21 15.67 14.95 14.54 LIC
15 12.4 13.17 12.45
9.39 INDIABULLS
10
PNB
5
0
AVERAGE OF ROE (5 YEARS)

30
25.102
25
20 18.228
16.784
15 12.942
Series1
10
5
0
INTERPRETATION:
HDFC –The ratio has been good compared to other companies but the ratio has
decreased in 2019 from previous years. The net profit has been decreased in 2019 the
reason can be improper management in the fixed assets as the depreciation expenses
has been increased and rest all liquidity and debt management is good which
contributed to better ratio and return to the stockholders.
LIC - The ratio of this company has shown decreasing trend. As per the financial
statement of the company the net income has been increasing at the same pace but the
ratio has been decreasing which means the company has increased its equity in 2019
but not able to manage the assets and debt properly to generate more income.
INDIABULLS- The return on equity of INDIABULLS is highest of all every year
which means the company is managing the liquidity, debt and assets properly to
generate income. But the ratio has seen declining trend which needs to be improved.
73
PNB- The ratio has been low compared to others but it has been improved from 2015
to 19 which mean the company is maintaining its assets and debts properly.
AVERAGE – the average of INDIABULLS has been highest so any investor would
choose that company which provides high returns for their money.
 EPS (EARNING PER SHARE):

The diluted EPS mentioned in the financial statements of the company is used. The
diluted EPS considers the affects of convertible securities also that’s why that is used.
This ratio is used in determing a shares price as it shows what the investor earns in
return of investing in a single share.
Mar-15
37.78 27.47 55.52 24.41
Mar-16
44.1 32.91 57.48 27.48
Mar-17
45.7 38.26 66.48 36.15
Mar-18
73.73 39.42 82.91 49.32
Mar-19
56.08 48.17 86.85 64.22
AVERAGE 51.478 37.246 69.848 40.316
TABLE 15 ANALYSIS OF EPS
EPS
100
82.91 86.85
80 73.73
66.48 64.22
55.52 57.48 56.08 HDFC
60 49.32 48.17
44.1 45.7 LIC
37.78 38.26 36.15 39.42
40 32.91 INDIABULLS
27.47 24.41 27.48
20 PNB
0
74
AVERAGE OF EPS (5 YEARS)

80
69.848
70
60 51.478
50
37.246 40.316
40
Series1
30
20
10
0
INTERPRETATION:
The higher ratio is more profitable for the investors. The EPS of each company has
increased from 2015 to 2019 which means the income has been increasing for each
share.
AVERAGE – the average of INDIABULLS is the highest which will be preferred by
the investors.
 PRICE TO BOOK VALUE-

This ratio shows how the investors are willing to pay more for stocks than the book
value or not. The company having ratio more than 1.0 is well regarded by the
investors.
Mar-15 6.67 2.82 3.05 0
Mar-16 5.12 2.71 2.59 0
Mar-17 6.02 2.81 3.56 3.52
Mar-18 4.98 2.13 4.09 3.42
Mar-19 4.38 1.66 2.12 1.95
AVERAGE 5.434 2.426 3.082 1.778
TABLE 16 ANALYSIS OF PRICE TO BOOK VALUE RATIO
75
PRICE TO BOOK VALUE

8
7 6.67
6.02
6
5.12 4.98
5 4.38 HDFC
4.09
4 3.56
3.52 3.42 LIC
3.05
2.82 2.81
3 2.71
2.59 INDIABULLS
2.13 2.12
1.95
2 1.66 PNB
1
0 0
0
AVERAGE OF PRICE TO BOOK VALUE(5 YEARS)

6 5.434
5
4
3.082
3 2.426
Series1
1.778
2
0
INTERPRETATION:
The ratio of all the companies has been more than 1.0 which means the investors are
ready to pay more market price than the book value. Still the ratio of all the
companies have been decreasing from 2015 to 2019 which means for each book value
the market price has been decreasing. The difference in book and market value is also
due to inflation not reflected in the asset values.
AVERAGE- The average of HDFC is highest which shows the investors prefer this
company to pay high market prices in respect to its book value.
 EARNINGS YEILD –
This ratio shows how much a company earned per share. This is used by the investors
as a return metric as how much an investment may earn for investors. The ratio of all
76
the companies is less than 1.0 which means all the companies are overvalued in terms
of price.
Mar-15 0.03 0.06 0.1 0
Mar-16 0.04 0.07 0.08 0
Mar-17 0.03 0.06 0.07 0.03
Mar-18 0.04 0.07 0.07 0.04
Mar-19 0.03 0.09 0.1 0.07
AVERAGE 0.034 0.07 0.084 0.028
TABLE 17 ANALYSIS OF EARNINGS YIELD
Earnings yield
0.12
0.1 0.1
0.1 0.09
0.08
0.08 0.07 0.07 0.07
0.07 0.07 HDFC
0.06 0.06
0.06 LIC
0.04 0.04 0.04 INDIABULLS
0.04 0.03 0.03 0.03 0.03
PNB
0.02
0 0
0
AVERAGE OF EARNINGS YIELD (5 YEARS)

0.09 0.084
0.08 0.07
0.07
0.06
0.05
0.04 0.034 Series1
0.028
0.03
0.02
0.01
0
77
INTERPRETATION:
AVERAGE –The average of INDIABULLS is highest of all other companies which
mean the stock price is this company is less but still the earnings increase which led to
increase in the ratio.
 DIVIDEND YEILD-
This ratio shows an estimate of dividend only return of a stock investment. The high
ratio may be attractive for investors who like regular dividend income nut a increase
in this ratio comes at the cost of growth potential which mean the amount which is
paid by the company as the dividend is not preferred for reinvesting and increasing
capital gains.
Mar-15 1.21 1.19 4.36 0.00
Mar-16 1.37 1.17 6.26 0.00
Mar-17 1.15 0.84 3.10 0.43
Mar-18 1.09 1.43 3.38 0.75
Mar-19 0.96 1.36 5.09 1.07
AVERAGE 1.16 1.20 4.44 0.45
TABLE 18 ANALYSIS OF DIVIDEND YIELD
DIVIDEND YILED
7.00 6.26
6.00
5.09
5.00 4.36
HDFC
4.00 3.38
3.10 LIC
3.00
INDIABULLS
2.00 1.37 1.43 1.36 PNB
1.21
1.19 1.17 1.15 1.09 0.96 1.07
0.84 0.75
1.00 0.43
0.00 0.00
0.00
78
AVERAGE OF DIVIDEND YIELD (5 YEARS)

5.00 4.44
4.00
3.00
Series1
2.00
1.16 1.20
1.00 0.45
0.00
INTERPRETATION:
AVERAGE –The average of INDIABULLS is highest which shows that investors get
high annual dividend by investing in it for each share price they pay. The financial
statements of all the companies shows that the dividend paid is almost zero in 2019
but still the ratio increases of INDIABULLS and LIC that is because of the changes in
the stock price. The stock price also affects the dividend yield of the company.
8.3 COMPARATIVE ANALYSIS OF COMPANIES THROUGH

STOCK RETURN
The analysis of stock return is based on monthly data of share prices of all selected
companies. The data of last 5 years has been taken. The purpose is to know if the
investors invest in any of these companies what percentage of return they can get.
This data also shows whether the company which is performing strongly according to
the ratios, does their share price also moves accordingly. For instance in most of
above shown ratios the average of INDIABULLS was the highest, so their share price
is also highest compared to other companies and give better returns.
The formula used to calculate stock return is:
Current close price – previous close price / previous close price *100
The average return of each year was then calculated and shown through line graph
that how they performed in last 5 years
79
HDFC:
AVERAGE
YEAR RETURN
2015 0.20
2016 0.21
2017 2.65
2018 1.40
2019 1.92
TABLE 19 ANALYSIS OF HDFC STOCK RETURN
AVERAGE RETURN HDFC

3.00 2.65
2.50
1.92
2.00
1.40
1.50
AVERAGE RETURN
1.00
0.50 0.20 0.21
0.00
2015 2016 2017 2018 2019
LIC:
AVERAGE
YEAR RETURN
2015 0.79
2016 1.05
2017 0.22
2018 -0.74
2019 2.48
TABLE 20ANALYSIS OF LIC STOCK RETURN
80
AVERAGE RETURN LIC

3.00 2.48
2.50
2.00
1.50 1.05
0.79
1.00 AVERAGE RETURN
0.50 0.22
0.00
2015 2016 2017 -0.74
2018 2019
-0.50
-1.00
INDIABULLS:
AVERAGE
YEAR RETURN
2015 2.36
2016 -0.52
2017 5.50
2018 -1.76
2019 -3.53
TABLE 21 ANALYSIS OF INDIABULLS STOCK RETURN
AVERAGE RETURN INDIABULLS

5.50
6.00
5.00
4.00
3.00 2.36
2.00
1.00 AVERAGE RETURN
-0.52
0.00
-1.00 2015 2016 2017 -1.76
2018 2019
-2.00
-3.53
-3.00
-4.00
81
PNB:
AVERAGE
YEAR RETURN
2017 4.38
2018 -2.07
2019 -2.29
TABLE 22 ANALYSIS OF PNB STOCK RETURN
AVERAGE RETURN PNB

5.00 4.38
4.00
3.00
2.00
1.00 AVERAGE RETURN
0.00
-1.00 2017 2018 2019
-2.07 -2.29
-2.00
-3.00
INTERPRETATION:
The above graphs of four companies shows that currently in 2019 only HDFC and
LIC are in profitable positions, the other two companies are showing negative return.
The highest return of whole period and between selected companies was of
INDIABULLS in 2017 which was 5.50% but after that the trend changed and there
was negative return. No other company gave such high return in whole period of 5
years so INDIABULLS was giving good returns till 2017 then share price decreased
may be because the stock is undervalued.
8.4 FINDINGS AND CONCLUSION

 The qualitative analysis described during the study shows how the company
will perform in the future through their business model and future targets.
From the selected companies it seems that INDIABULLS have already
performed well in providing e-home loans which can attract more customers
82
and their future target also seems to increase loan facilities through online
platform. So this company can perform well in future.
 Through ratio analysis it can be observed that in last 5 years the average of
INDIABULLS has performed well in almost all the ratios. But compared to
previous years the company has not been performing well in 2019 as analysis
of financial statements shows that their earnings and profits have been
decreasing which affects the investors.
 The company HDFC has also performed well according to the ratio and their
current position is also better compared to other companies. The ratios have
been increasing and can provide good return to investors.
 The stock return analysis shows that if investors would have invested in any of
these selected companies what percentage of return they can get each year.
 The analysis shows that despite the average of INDIABULLS being highest in
all ratio the return on share price of company is decreasing from 2018 and
currently showing negative return
 While the return provided by HDFC is also been decreasing after 2017 but it
has maintained positive return in 2019.
 It can also be observed that the companies such as LIC having market cap
more than INDIABULLS have been not able to perform well in ratio analysis
 PNB has not performed well in either ratios or stock return analysis.
CONCLUSION –
According to my study and analysis, it can be concluded that two companies HDFC
and INDIABULLS can be a good choice for any investor to invest in. INDIABULLS
currently is not performing that good but if investor can invest in this company and
hold the position it can give better results in coming 2 – 3 years as its fundamentals
are strong. But if the investor wants current returns then HDFC can be chosen as it is
providing better stock returns currently.
83
CHAPTER 9
ACHIEVEMENTS
 The company is currently using two of the strategies back tested

under this study for trading at their firm which are EMA 50
high/low and sum of average trade high/low.
 During the internship period, got an opportunity to attend a seminar

on “TRADING BASE ON PSYCHOLOGY OF NUMBER
SYSTEM – GANN THEORY”
84
CHAPTER 10
LIMITATIONS
I, being a student, and not having expertise in research field, may lack certain
conceptual clarity.
 The study is done during the internship period of 8 – 10 weeks, so time being
a limitation the research can be carried out on some of the indicators used for
technical analysis where many are available for profitable trading.
 The fundamental analysis which is part of the report is limited as per my
knowledge so other valuation techniques which can prove helpful for selection
of stocks are not used.
 The study is limited to the knowledge about the concerned topic and thus it
may not represent the in depth study.
85
CHAPTER 11
CONCLUSION
The study is based on technical analysis and options strategies to predict whether the
stock will be profitable in the future or not. The decision is based on back testing of
the strategy for various scrips and indices. In this study some indicators and option
strategy has been used, which has been selected with the help of SIP guide. It can be
concluded that all the strategies are not profitable, even the strategy being profitable
some of the stocks may not perform well and indicate loss in back testing, so this
study helped to know which stocks and indices is better to be traded. As one of the
precondition of technical analysis is that history repeats itself, which means the stocks
which seems profitable through back testing on past data will be profitable in the
future also. It can also be concluded that back testing is trial and error method as there
is no assurance that every strategy will be as effective. The future price can be
affected by external factors so testing is just probability and does not guarantee
assured returns.
The second section of the study is based on fundamental analysis which shows that
how the financial statements of the company can be used by analysts to determine the
fair value of the company. It helps to determine whether the company’s financial
position is stable or not. It can be concluded that not all the companies whose share
price is growing are profitable to invest in; it might happen that the company is
overvalued and in future it gives negative returns. The four companies identified on
the basis of market capitalization of NBFC sector are analyzed and it can be
concluded that the financial position of INDIABULLS and HDFC is better than other
two. These two companies are good to invest in from long term perspective based on
analysis done by me but different investors have different perspective and the decision
may vary.
86
BIBLIOGRAPHY
 James Chen. Investopedia stock market industry (Online)
Available from: https://www.investopedia.com/terms/s/stockmarket.asp
 Pestel analysis of Indian capital market (Online)
Available from: https://www.mbaknol.com/investment-management/pestel-
analysis-of-indian-capital-market
 Jainam Share Consultants Pvt. Ltd. Jainam website home page (Online)
Available from: https://www.jainam.in/
 Live charts. Investing.com (Online)
Available from: https://in.investing.com/charts/live-charts
 Technical Indicators and overlays (Online)
Available: https://school.stockcharts.com/doku.php?id=technical_indicators
 Historical contract wise price volume Data (Online)
Available:
https://www.nseindia.com/products/content/derivatives/equities/historical_fo.h
tm
 Brokerage report of HDFC (online)
https://www.moneycontrol.com/financials/housingdevelopmentfinancecorpora
tion/ratiosVI/HDF
 Brokerage report LIC housing finance (online)
http://www.moneycontrol.com/india/financials/lichousingfinance/balance-
sheet/LIC?classic=true
 Brokerage report INDIABULLS housing finance (Online)
https://www.moneycontrol.com/financials/indiabullshousingfinance/consolidat
ed-balance-sheet/IHF01
 Brokerage report PNB housing finance (Online)
https://www.moneycontrol.com/india/financials/pnbhousingfinance/balance-
sheet/PHF
87
LIST OF TABLES:
TABLE 1: ANALYSIS OF SCRIPS ON EMA 50 STRATEGY .............................. 36
TABLE 2 – ANALYSIS OF SCRIPS ON SUM OF AVG TRADE STRATEGY .... 37
TABLE 3 – ANALYSIS OF SCRIPS ON EMA 50 HIGH/LOW STRATEGY ........ 45
TABLE 4 – YEAR WISE SUMMARY OF SELECTED SCRIPS ........................... 46
TABLE 5 – ANALYSIS OF SCRIPS ON SUM OF AVG TRAGE HIGH/LOW
STRAREGY ............................................................................................................ 53
TABLE 6 - SUMMARY OF SELECTED SCRIPS .................................................. 53
TABLE 7 - SUMMARY OF BN ON WEEKLY STRADDLE STRATEGY ............ 55
TABLE 8 - SUMMARY OF BN ON MONTHLY STRADDLE STRATEGY......... 56
Table 9 ANALYSIS OF CURRENT RATIO ........................................................... 63
Table 10 ANALYSIS OF NET PROFIT MARGIN ................................................. 65
TABLE 11 ANALYSIS OF DEBT TO EQUITY RATIO ........................................ 67
TABLE 12 ANALYSIS OF ASSET TURNOVER RATIO...................................... 69
TABLE 13ANALYSIS OF INTEREST COVERAGE RATIO ................................ 71
TABLE 14ANALYSIS OF RETURN ON EQUITY ................................................ 72
TABLE 15 ANALYSIS OF EPS ............................................................................. 74
TABLE 16 ANALYSIS OF PRICE TO BOOK VALUE RATIO ............................ 75
TABLE 17 ANALYSIS OF EARNINGS YIELD .................................................... 77
TABLE 18 ANALYSIS OF DIVIDEND YIELD ..................................................... 78
TABLE 19 ANALYSIS OF HDFC STOCK RETURN ............................................ 80
TABLE 20ANALYSIS OF LIC STOCK RETURN ................................................. 80
TABLE 21 ANALYSIS OF INDIABULLS STOCK RETURN ............................... 81
TABLE 22 ANALYSIS OF PNB STOCK RETURN............................................... 82
88

Technical Analysis

Uploaded by

Copyright:

Available Formats

Technical Analysis

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Technical Analysis

Uploaded by

Copyright:

Available Formats

SIP REPORT

TECHNICAL ANALYSIS AND OPTIONS

Enrolment no.: 1-18-072

UNDER THE GUIDANCE OF

FACULTY GUIDE: Prof. Tirthank Shah

COMPANY GUIDE: Mr. Nirav Kansariwala

I, MASOOM TEKWANI, the author of the SIP titled TECHNICAL ANALYSIS

Signature of the Student: _________________

Guide (Name) : Prof. Tirthank Shah

I Masoom Tekwani, would like to take this opportunity to express my deepest

This study involves understanding of technical analysis, different chart patterns,

The second section of the report consists of FUNDAMENTAL ANALYSIS done on

Chapters Page No.

1.1 OBJECTIVES OF STUDY:

PRIMARY OBJECTIVE: To understand and apply various trading strategies related

 JOHN J. MURPHY (1999) TECHNICAL ANALYSIS OF FINANCIAL

 MANOJ SINGH (2019) AN INTRODUCTION TO STOCK MARKET

 DERIVATIVE MARKET, NSE(1993)

 DRAKOPOULOU V (2015) A REVIEW OF FUNDAMENTAL AND

3.1 STOCK MARKET PARTICIPANTS

 MARKET MAKER: A market maker is a broker-dealer who facilitates the

inventory of shares. He ensures sufficient liquidity in the market for a

3.2 STOCK MARKET INSTRUMENTS

 SHARES/ EQUITY: Equities or stocks or shares give you ownership of a

3.3 FUTURES AND OPTIONS MARKET:

3.4 PESTLE ANALYSIS OF STOCK MARKET:

ECONOMICAL: The economical measures taken by the government of India has a

TECHNOLOGICAL: Same as social factors, technological factor can have an effect

ENVIORNMENTAL FACTORS: Initially, the environmental factors don’t play a

4.1 A BRIEF HISTORY OF THE COMPANY

4.4 ORGANISATIONAL STRUCTURE

DIRECTOR DIRECTOR DIRECTOR

SENIOR COO BUSINESS COO

4.5 SENIOR MANAGEMENT

Dr. Jitendra Shah

Mr. Chirag Mr. Nipun Shah Mr. Milan Parikh

RESEARCH DATA, JOBBING

4.6 VARIOUS DEPARTMENTS

1. Marvel Equity-Mid cap 1 Lac (min) 1 year 15-17%

2. India opportunity Equity-Large 1 Lac (min) 1 year 15-17%

Pure value picks

4. Bull Edge(Cheque) Equity cash 1 Lac (min) 1 year 15-18%

5. Intra Edge(Cheque) Equity/Futures 1/5 Lacs - 15-20%

6. Intra edge(stock) Equity/Futures 1/5 Lacs 1 year 15%

8. Tech Trendz(Stock) Index futures 6 lacs 3 years 8-10%

 HUMAN RESOURCE DEPARTMENT

 After approval of Manpower requisition form, HR department gives the detail

TRAINING AND DEVELOPMENT:

currency derivatives are expected to benefit participants, including hedgers,

4.8 SWOT ANALYSIS:

5.1 TECHNICAL ANALYSIS

Market Action Discounts Everything refers to what technicians believe is that

5.2 TYPES OF CHARTS

3. Point and Figure Chart

5.3 PRICE PATTERNS:

OTHER IMPORTANT TERMS:-

 SYSTEMATIC TRADING – The whole research is based on systematic

5.5 INTRODUCTION TO OPTIONS

STRATEGY 1: LONG CALL