Portfolio Update - May 2016

Quite a few changes in the portfolio. Exited one, added a significantly beaten down stock with attractive valuations and averaged another.

Please take a look at the updated portfolio:


Personal Accident Insurance – 16 important points everyone should know

At 28, Viren was one of the most punctilious planners that I had met in my life. He had a good professional life, completing the picture was his loving wife and two kids, whom he adored. Being a family man, he had bought two term insurance policies and a family floater health insurance policy. Armed with both these insurance policies, he was confident about his family’s financial security in his absence.

However, life is not so simple and easy. Viren met with an accident and his grave injuries left him incapacitated to work for at least next two years. While his family floater mediclaim policy took care of his hospitalization expenditure, for the rest, he dug into his rainy day savings to meet household expenses. However, the ordeal did not end here. As the sole breadwinner was unable to continue his job, the financial situation deteriorated. As term insurance policies pay benefits in case of death only; in this case, Viren was alive, and therefore, his term insurance policy didn’t pay anything. Suddenly, his poor state struck hard and Viren asked himself, if he could’ve done anything to avoid his gloomy state. 

Trading Idea - May 2016

For the Month of May one can initiate a short put trade on Adani Ports. The stock has corrected sharply in-spite of good results primarily because of unexpected balance sheet expansion and slower than expected volume growth. However the fall is quite sharp and has made implied volatility high.

One can sell 1 lot (1600 shares) of Adani Ports 160 put @ 0.5 for a cash flow of Rs.800 before brokerage and taxes.

Total Return from the trade:

Portfolio Update April 2016

Booked significant gain in a stock in the portfolio due to massive run-up. Not that the stock was expensive but a 70% up-move in a very short span of time is quite significant and its wise to take the profit off the table. We made around 40% return on that stock in 6 months time.

Cash Position increased to almost 25% of the portfolio as there has been around 1200 points up-move in Nifty from budget day low.

Please check the updated portfolio for further details:

Model Portfolio Performance Review - 2016

On 21st March 2016, model portfolio completed its 3rd year of existence. Though last year was quite challenging for few stocks due to global commodities melt down, 2017 is expected to be quite good in terms of portfolio performance as the stocks in the model portfolio has deep value and are backed by hard assets on ground.

The detailed performance review of the portfolio at market value as on 21st March 2016 is given below:

Post Office Small Savings Rates - Ready Reckoner

Post Office Savings Schemes in IndiaGovt of India has decided to review small saving schemes rates at Post Office on a quarterly basis instead of revising the rates once in a year. 

For the quarter effective 1st April 2016 to 30 June 2016, the rates have been reduced by 0.4% to 1.3% depending on the saving scheme. You can download and print the post office rates in India ready reckoner pdf from the following link:

Life is just an employer - Why ask less?

Jessie Belle Rittenhouse in his very inspirational poem "My Wage" termed Life as a generous employer from whom you can get whatever you ask for. If you ask for penny you will get penny and if you ask billion you will get billion. Life gives you exactly what you ask for. The poem also got featured in the very famous book "Think and Grow Rich" by Napoleon Hill. 

Trading Idea: Sell Nifty 6300 put

After a long while trading idea section is being restarted. Will try to publish one trading idea per month going forward. 

For the month of March 2016, one can sell Nifty 6300 put 1 lot (75) at Rs.15 thereby generating decent return on investment. Since 6300 is a very strong support area, it is highly unlikely that Nifty would close below that level in March series. Implied volatility at 6300 strike is quite high due to budget round the corner.

Total Return from the trade:

Considering one is able to sell the March PUT option of Nifty 6300 strike price at current market premium of Rs. 15 he/she can generate following return from this trade:

Portfolio Update Jan 2016

First Portfolio update of Calendar 2016. Sold a holding, averaged another in half and increased cash position to be deployed on further correction for buying Nifty BEES.

You can check the updated portfolio using the marquee at the right sidebar.

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