Zebu Blogs

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What Is a Follow-On Public Offer and How Does It Work?

A follow-on public offer (FPO) is when a publicly-traded firm that has already been listed on a stock market issues shares to the general public. Companies might use a follow-on public offer to obtain extra capital for a variety of reasons, including expanding their business operations, reducing debt, and so on. However, the company must have already gone public through an initial public offering (IPO), in which it sells shares to the general public for the first time. Also, the shares issued through the FPO must be open to the whole public, not only current stockholders. The company's performance determines the share price during the initial public offering (IPO), and the company hopes to attain the desired price per share during the IPO listing. The share price for FPO, on the other hand, is market-driven because the stock is already traded on the stock exchange. As a result, the investor can better grasp the company's value before making a purchase. In addition, the price of follow-on public shares is often lower than the current trading price. The corporation may seek an FPO for a variety of reasons, including the need for finances to pay down debt or make an acquisition. Existing shareholders may be interested in cashing out their existing interests in some situations. Companies in other cases wish to raise funds in order to refinance their debt at cheap interest rates. As a result, before applying for an FPO, investors must be careful and assess the reasons behind the company's offering. Before you start investing or trading, we recommended going with one of the best brokerage firms in the country like Zebu. As a top broker in share market we have created one of the best stock trading platforms for you to use and invest. Types of Follow On Public Offers Depending on how ownership is transferred to new shareholders, there are two sorts of follow-on public offers. FPO diluted The first type of FPO is a diluted FPO, in which the corporation issues more new shares. As a result, the number of outstanding shares of the corporation rises, lowering earnings per share. The money raised in this way is usually used to pay down debt or restructure the capital structure of a company. FPO non-diluted When existing shareholders of a corporation sell their shares to the public, it is known as a non-diluted FPO. Rather than going to the corporation, the revenues of the sale go to the shareholders. As a result, the shareholder incurs no financial loss. Founders, promoters, board of directors, and pre-IPO investors are typically among these shareholders. The earnings per share stay steady because no new shares are issued and existing shares are offered for sale. Secondary market offerings are another name for non-diluted FPO. Furthermore, this sort of FPO has no benefits for the company and is just utilised to change the ownership structure of shares. What Motivates Businesses to Make a Follow-On Public Offer? In most cases, firms issue extra shares in order to inject more capital into the company. The following are some of the reasons why a corporation might need to raise money: If the company's debts are too significant, the revenues from the sale may be used to pay down the debt. This allows them to escape debt covenants that may limit their ability to operate their business. To grow its existing equity shares and rebalance its capital structure while maintaining the ideal debt to equity ratio, a corporation may issue more shares. When an initial public offering (IPO) fails to attract the funds required for the company's expansion ambitions, a follow-on public offering is used to issue more shares. Finally, rather than accumulating debt, a firm decides to raise cash by issuing shares, which can be useful for financing new initiatives, acquisitions, or commercial operations. The Benefits of Investing in a Follow-On Public Offer Investing in an FPO can be more beneficial to investors than investing in an IPO since investors have a better understanding of the firm, its management, and business practises. Investors can also consult historical stock market performance, earnings reports, and a wealth of other information. The share prices are slightly lower than those traded on the stock market when corporations issue shares through FPO. This allows investors to make a risk-free return by purchasing and reselling shares on the secondary market. Many investors engage in arbitrage trading, which involves purchasing shares in an FPO at a cheap price and selling them at a higher price on the market to profit. An FPO has a significantly lesser risk than an IPO. As a result, just like any other investment, FPO needs investors to do their homework on the firm and its past success. It is, however, considerably easier to investigate and is better suited to investors who have a thorough grasp of risk. Also, investors will be able to purchase company shares at a reduced price as a result of this arrangement. As one of the top brokers in share market we have created the best stock trading platform for you to invest in wisely. Our tool is designed to help investors and traders alike to analyse a company with a wide range of indicators and screeners as per your strategy. As one of the best brokerage firms in the country, we invite you to open a trading and investment account with us.

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Trading The Head And Shoulders Pattern

The head and shoulders chart pattern, which shows a baseline with three peaks, the middle peak being the highest, is a common and easy-to-spot pattern in technical analysis. It is mainly used to detect a bullish-to-bearish trend reversal. The pattern can be employed by all sorts of traders and investors because it appears in all time periods. The chart pattern gives crucial and immediately visible levels, making entry levels stop levels, and target goals simple to apply. Before you start investing or trading, always consider going with one of the best brokerage firms in the country like Zebu. As a top broker in share market we have created one of the best stock trading platforms for you to use and invest. Head and Shoulders pattern We'll start with the head and shoulders pattern and then go on to the inverse head and shoulders pattern. Pattern formation (as seen at market peaks): As you can see, in this pattern, there is a price rise, followed by a dip (left shoulder) and a peak (head) and a dip to the low of the left shoulder and a peak (right shoulder) to the highs of the left shoulder and a drop below the low of the left shoulder and the head. By joining the lows of the left shoulder and the head, you can get the neckline. Inverse Head and Shoulders Pattern formation (as seen during market bottoms): A price drop followed by a rise (left shoulder), followed by a deeper fall and a rise to the same level (head) and a drop to the lows of the left shoulder and a breakout (right shoulder) from the high of the head and left shoulder. The highs of the left shoulder and the head form the neckline. How to Profit from the Pattern Traders should always wait for the pattern to finish because a pattern may not develop at all and the price may move in the opposite direction. Patterns that aren't completed yet should be kept an eye on, but no trades should be made until the price breaks the neckline. After the peak of the right shoulder, we look for the price of a stock to move lower than the neckline. After the right shoulder has formed, we wait for the price to move over the neckline for the inverse head and shoulders to show up. When the pattern is done, a trade can be initiated when the neckline is broken. Plan your trades with stops and targets. Another way in requires more patience and the risk that the move won't be capitalised at all. After a breakout, this strategy is all about waiting for a pullback to the neckline. This is safer because we can watch to see if the pullback ends and the original breakout direction stays the same. Putting Your Stops in Place In the head and shoulders pattern, your stop-loss order can be placed slightly above the right shoulder. Alternatively, the pattern's head can be employed as a stop, but this carries a significantly higher risk and so diminishes the pattern's reward to risk ratio. In the inverted pattern, the stop-loss order can be placed slightly below the right shoulder. The stop can be placed at the head of the pattern once more, but this increases the trader's risk. Choosing Your Profit Targets The price differential between the head and the low point of either shoulder is the pattern's profit target. The difference is then deducted from the neckline breakout level (at a market peak) to determine a downward price target. The difference is added to the neckline breakout price to create an upward price target for a market bottom. Between recognising the breakout and attaining the appropriate profit target, investors may have to wait a long time—up to many months. Real-time monitoring of your trades can help you predict their outcomes better. As one of the top brokers in share market, we have created the best stock trading platform for you to invest in wisely. Our tool is designed to help investors and traders alike to analyse a company with a wide range of indicators and screeners as per your strategy. As one of the best brokerage firms in the country, we invite you to open a trading and investment account with us.

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A Comparison of Limit and Stop Orders: An Overview

A Comparison of Limit and Stop Orders: An Overview You can be more particular about how you want your broker to fill your trades with different sorts of orders. When you place a limit or stop order, you're telling your broker that you don't want your order to be executed at the market price (the current price at which a stock is trading); instead, you want it to be executed when the stock price matches a price that you specify. Before the comparison of Limit and Stop Orders we would like you to know that at Zebu, one of the fastest-growing brokerage firms in the country, we have created the best Indian trading platform and lowest brokerage for intraday trading. Between limit and stop orders, there are two major distinctions. The first is that a limit order utilises a price to specify the transaction's least acceptable amount, but a stop order uses a price to simply trigger an actual order after the given price has been transacted. The second difference is that a limit order is visible to the market while a stop order is not until it is activated. If you want to buy a Rs 100 stock for Rs 95 per share, for example, the market will recognise your limit order and fill it when sellers are willing to meet that price. The market will not see a stop order, and it will only be activated when the stop price is met or surpassed. If the price triggers the stop in a standard stop order, a market order is placed. If the order is a stop-limit, a limit order will be placed conditional on the triggering of the stop price. As a result, a stop-limit order will necessitate both a stop and a limit price, which may or may not be the same. Limit Orders A limit order is a purchase or sale order for a certain stock at a specific price. For example, if you wished to buy Rs 100,000 worth of stock for Rs 100,000 or less, you can place a limit order that will not be completed unless the price you stated becomes available. However, because a better price is already available, you cannot place a simple limit order to buy a stock above the market price. You can also use a limit order to sell a stock at a certain price when it becomes available. Assume you hold Rs 75 per share of stock and wish to sell if the price rises to Rs 80 per share. A limit order of Rs 80 can be placed, and it will only be filled if the price is equal to or better than that. Because there are better prices available, you cannot set a limit order to sell below the current market price. Stop Orders Stop orders are offered in a few different forms, but they are always conditional on a price that is not yet available in the market when the order is made. A stop order will be activated when the future price is available, but the broker will execute it differently depending on the kind. When your stop price is hit or exceeded, a standard stop order will become a traditional market order. If you intended to open a position when a stock's price was increasing, you could place a stop market order above the current market price, which would then become a regular market order if your stop price was met. Stop-Limit Orders There are two prices in a stop-limit order: a stop price and a limit price. When a certain stop price is met, this order type can activate a limit order to purchase or sell a securities. Assume you buy shares for Rs 100 with the expectation that the stock will climb. If your prediction was incorrect, you might sell the shares using a stop-limit order. If you put the stop price at Rs 90 and the limit price at Rs 90.50, the order will go into effect if the stock trades for Rs 90 or less. A limit order, on the other hand, will only be completed if the limit price you specify is accessible in the market. The order will be activated if the stock drops overnight to Rs 89 per share, which is below your stop price, but it will not be filled immediately because there are no buyers at your limit price of Rs 90.50 per share. In this order scenario, the stop price and the maximum price may be the same. There are two main hazards with a stop-limit order: no fills or incomplete fills. It's possible that your stop price will be activated while your limit price remains inactive. It's possible that if you used a stop-limit order as a stop-loss to exit a long position when the stock started to fall, your trade would not be closed. Even if the limit price is available after a stop price has been triggered, if there isn't enough liquidity at that price, your entire order may not be executed. If you wanted to sell 500 shares at a Rs 75 limit price but only 300 were filled, you may incur further losses on the remaining 200 shares. A stop order eliminates the risk of no fills or partial fills, but because it is a market order, it is possible that your order will be filled at a price that is far lower than what you expected. Consider the following scenario: you've placed a stop order at Rs 70 on a stock that you purchased for Rs 75 a share. After disappointing investors, the company publishes earnings after the market closes and opens the next day at Rs 60 per share. Your order will be activated, and you may exit the trade at Rs 60, well below your stop price of Rs 70. As we mentioned before, trading requires the best Indian trading platform and the lowest brokerage for intraday trading. As one of the best brokerage firms in the country, we have created a powerful trading platform that makes analysis easy for you. To know more about its features, please get in touch with us now.

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Everything You Need to Know About Trailing Stop Losses

Online brokers are always looking for new ways to keep investor losses to a minimum. One of the most popular downside protection techniques is a stop-loss order, which automatically sells a position at the current market price if the price drops to a specified level, preventing further losses. Before we get into the basics of trailing stop loss, it’s important to know that it takes a certain level of experience before you can become profitable. However, if you would like to get started, you need access to the best trading platform from one of the best online share brokers in the country. At Zebu, we give you all of this and more - we also offer the lowest brokerage for intraday trading. Trailing stop-loss order Traders can improve the effectiveness of a stop-loss order by combining it with a trailing stop, which is a trade order in which the stop-loss price is set at a percentage or rupee amount below the market price. When the price goes up, the trailing stop goes up with it. The new stop-loss price remains at the level it was dragged to when the price finally stops climbing, automatically safeguarding an investor's downside while locking in profits when the price achieves new highs. Trailing stops can be used with regular stop-loss orders on stock, options, and futures exchanges. The Functions of a Trailing Stop Consider the following scenario for a better understanding of how trailing stops work: Buy price: Rs 100 Price at the time of setting a trailing SL: Rs 100.5 Trailing amount: Rs 1 Immediate SL: 99.5 If the market goes up to 101, the trailing SL will be moved up to 100. If the price goes back to 100, your SL order will be triggered and you will exit with a slight loss (considering slippage, taxes, and fees). It's critical to avoid the need to reset your trailing stop during market dips, or your effective stop-loss will be lower than intended. When you notice momentum peaking in the charts, especially when the stock is hitting a new high, it's also a good idea to rein in a trailing stop-loss. It's critical to assess your maximum risk tolerance when using classic stop-losses with trailing stops. Set a stop-loss at 2% below the current stock price and a trailing stop at 2.5 percent below the current stock price, for example. As the price of the stock rises, the trailing stop will outperform the fixed stop, making it redundant. To make this approach work on current trades, you'll need to select a trailing stop value that takes into account the stock's regular price movements while catching just the genuine price decline. This can be accomplished by analysing a stock for several days before engaging in active trading. Furthermore, when using a trailing stop, there is the risk of setting it too tight during the early phases of the stock's support. The consequence will be the same in this situation, with the stop being triggered by a temporary price downturn, leaving traders concerned about a perceived loss. This might be a difficult mental pill to take. You need the lowest brokerage for intraday trading as well as the best trading platform. As a leading online share broker, we at Zebu have created the perfect trading platform with an extensive amount of features to simplify trading for you.

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Ways To Determine The Ideal Stop Loss

When it comes to trading, no one wants to lose money. That is why it is critical to establish a floor of security for your position. Stop-loss orders are used in this situation. Many investors, however, struggle to determine where to place their stop-loss levels. If your stop-loss orders are placed far away from your entry price, you can lose a lot of money. However, you can get out of a position too rapidly if you set your stop-losses too close together. So, how do you know where your stop-loss order should be placed? When you start trading, it is important to have one of the best trading accounts from the best share broker in terms of the number of indicators you can use. Our online trading platform that gives you the widest range of leading as well as lagging indicators for you to choose from. With us, you can execute any complex strategy with any number of indicators. What Is a Stop-Loss Order and How Does It Work? A stop-loss order instructs a broker to sell stocks at a certain price if they reach it. These orders aid in minimizing an investor's loss in a security position. As an example, if you set your stop-loss order at 10% below the price at which you bought the security, your loss will be limited to 10%. If you buy Company X stock for Rs 100 per share, for example, you can place a stop-loss order for Rs 90. This will limit your losses to 10%. Your shares will be sold at the present price if Company X's stock falls below Rs 90. Choosing a Stop-Loss Order Targeting a permitted risk level is the key to determining where to place a stop-loss order. This price should be calculated wisely to minimize loss. There are numerous theories about where to place a stop-loss order. Technical traders are continuously looking for new ways to time the market, and different types of stop or limit orders have diverse applications based on the timing strategies used. Some theories employ universal stops, such as a 6% trailing stop on all stocks, while others employ security- or pattern-specific stops, such as average true range percentage stops. Methods of Stop-Loss placements The above-mentioned percentage technique is one of the most common. There's also the support strategy, which involves placing hard stops at a certain price. This strategy may be a little more difficult to master. You'll need to determine the stock's most recent support level. You can put your stop-loss order slightly below that level once you've figured that out. The moving average method is the other option. Stop-losses are placed just below the moving average price when using this method. Swing traders frequently use the multiple-day high/low strategy, in which stops are set at the lowest price of a given trading day. Lows, for example, may be replaced at the two-day low. Indicator stops based on larger trend analysis may be used by more patient traders. Other technical indicators, like the relative strength index, are frequently used in conjunction with indicator stops. What to Think About When Using Stop-Loss Orders When it comes to stop-loss orders, there are a few things to keep in mind as an investor: Stop-loss orders are not for active traders who monitor every move of the price. Stop-loss orders aren't ideal for huge blocks of stock because you risk losing more money in the long run. Also, never assume that your stop-loss order has been executed. Always wait for a confirmation of your order. Final Thoughts To select stop-loss placements, traders should assess their personal risk tolerances. To determine whether retracements are common, specific markets or securities should be investigated. Retracement-prone securities require a more active stop-loss and re-entry approach. Stop-losses are a type of profit-capture and risk-management strategy, but they do not ensure profitability. Creating a trading strategy is an art. You need the best trading accounts from the best share broker to give you access to all types of leading and lagging indicators. This is exactly what we offer at Zebu. We have created a highly advanced online trading platform that helps you take the best possible trades. To know more about Zebull Smart Trader, please get in touch with us now.

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Stop-loss Hunting And How You Can Identify It

What Is the Definition of Stop Hunting? Stop hunting is a method for forcing some market players out of positions by raising the price of an asset to a level where numerous others have placed stop-loss orders. The simultaneous activation of several stop losses causes extreme volatility, which can give a unique opportunity for investors looking to trade in this situation. Before we give you an explainer on stop-loss hunting, it is important to know that you need to analyse them for maximum profits. At Zebu, one of the fastest-growing brokerage firms in the country, we have created the best Indian trading platform with the lowest brokerage for intraday trading. If you would like to simplify your option trading game, we are here to help you out. Stop hunting is motivated by the fact that when a large number of stop losses are triggered, the price of an asset might change dramatically. Traders benefit from price volatility because it gives prospective trading opportunities. Assume that ABC Company's stock is currently trading at INR 100 and appears to be moving lower. Many traders may set their stop losses just below Rs 100, at Rs 99, so that they may still hold on to their stocks and profit from an upward move while reducing their losses. Traders foresee a rush of sell orders if the price falls below Rs 100, as many stop losses will be activated. This will push the price lower, allowing some traders to profit from the drop and possibly even open a bullish position on the expected recovery to the previous range. Stop-Loss and Stop-Hunting Orders Stop-loss orders are slightly more difficult than a standard market or limit order. An investor will put a stop-loss order with their broker to sell a security when it hits a specific price. If you own shares of XYZ Inc., which are presently trading at Rs 1500, and you want to protect yourself against a substantial drop, one option is to place a stop-loss order to sell your XYZ holdings at Rs 1475. Your stop-loss order is triggered and changes into a market order if XYZ falls below Rs 1475. Your XYZ positions would be liquidated at the best price available. Stop-loss orders are used to limit the amount of money that an investor can lose on a long position. A stop-loss order can also be used to safeguard a short position. Stop-loss hunting Stop hunting is a simple process. Any asset with a large enough market cap will trade in a more or less defined trading zone with support and resistance points. Stop losses on the downside tend to be crowded in a narrow band just below resistance, while stop losses on the upside tend to be clustered just above support. Due to their market influence, larger traders looking to add to or exit a position might change the price action with volume trades that amount to stop hunting. Increased volume with a clear directional push will usually signal this on the charts. For example, before breaking through, the price action can bounce twice off support on growing volume. Smaller traders take advantage of this stop hunting tendency to profit from the short-term volatility it generates. You can participate in stop hunting on the downside with a short position or consider it an opportunity to begin a long position at a price lower than the current trading range, depending on your method and indicators. As we mentioned before, stop-loss hunting needs the best Indian trading platform and the lowest brokerage for intraday trading. As one of the best brokerage firms in the country, we have created a powerful trading platform that makes option analysis easy for you. To know more about its features, please get in touch with us now.

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Everything You Need To Know About Paper Trading

With the rise of high-speed trading and algorithmic trading in the markets, day trading has become extremely competitive. But it is an extremely difficult field to succeed in. That is why you need to practise as much as possible. Executing paper trading requires a huge amount of analysis and the lowest brokerages you can find in India. As one of the fastest-growing stock broker companies in India, we at Zebu have created the best trading platform for calendar spreads and other futures and options strategies. What Is Paper Trading and How Does It Work? Simulated trading, often known as paper trading, allows aspiring traders to buy and sell stocks without risking real money. Investors might be able to replicate trading with a basic spreadsheet or even pen and paper, but day traders would find it difficult to manually record tens of transactions per day and calculate their profits and losses. However, there are many online platforms that provide paper trading accounts for people to practise with before investing real money in the market. This allows them to try out different techniques and get some practice with the software. Consider paper trading platforms that offer live market feeds before you start with real money while looking for the ideal place to practise your trades. This is critical since you'll want to be able to trade without having to wait for delayed feeds or orders to be processed. TradingView is a commonly used market simulator that most traders get started with. To utilise the simulator, day traders on these platforms will need to open an account, which may include depositing the minimum funding requirements. The good news is that traders can practise with the simulator before risking their money on live transactions. It's important to remember that there are some distinctions between simulated and live trading. Simulators may not account for slippage, spreads, or commissions, which can have a substantial impact on day trading returns on a technical level. On a psychological level, traders may find it simpler to follow trading system guidelines when there isn't any money at stake—especially if the trading system isn't performing well. Paper Trading Suggestions The way you trade on a given day is primarily determined by the approach you utilise. Some day traders, for example, rely solely on "feel" and must rely on paper trading accounts, whereas others utilise automated trading systems and backtest hundreds of systems before paper trading only the most promising. Traders should pick the finest broker platform for their needs depending on their trading preferences and then practise trading on those accounts. Here is where Zebu comes in. When paper trading, it's critical to keep a detailed record of your trades and to follow your approach over a long enough time frame. Some methods may only work in bull markets, leaving traders vulnerable when the market turns bearish. In order to verify that their strategies hold up successfully and deliver the maximum risk-adjusted returns, it's critical to test enough stocks in different market scenarios. Finally, paper trading isn't only a one-time activity. Day traders should use the paper trading capabilities on their brokerage accounts on a frequent basis to test new and experimental tactics before entering the market. For day traders who risk tens of thousands of rupees in hundreds of trades every day, simple mistakes can be extremely costly. As a result, paper trading is an essential component of long-term success. Advantages of Paper Trading Starting with a paper trading account can help you learn more quickly. However, there are additional advantages to self-education. To begin with, there is no risk. You don't lose anything because you aren't utilising real money. You can assess your mistakes and develop a winning plan. This also helps you gain confidence and gives you the opportunity to practice the tactics and strategies required to be a good day trader, such as profit or loss taking and pre-market preparation. Finally, it reduces the amount of stress associated with trading. You may focus on your strategies in a calm environment, removing the emotional aspect of trading. Paper Trading's Drawbacks While paper trading will provide you with the necessary practice, there are a few drawbacks. You don't get a sense of how fees and commissions affect your trades because it doesn't use actual money. These simulators also don't truly depict market reality, including lows and highs, as well as the emotion that comes with trading. As a result, keep in mind that this is a simulated environment where you can practice your trading talents. Practice Makes Perfect If you are new to trading or investment, spend as much time as possible with paper trading before entering the live markets. Make an effort to experiment with new strategies and ideas so that you can become more comfortable. Ultimately, the goal of paper trading is to shorten your learning curve. When it comes to executing paper trading, you need access to the best trading platform from one of the most reliable stock broker companies in the country. We also complement our platform with the lowest brokerage for trading. Please get in touch with us to know more about our services and products.

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10 Awesome Stock Market Movies To Binge This Long Weekend

A picture is worth a thousand words, and a movie may express an entire tale in a single scene or even a single line of speech. There is so much to be learned from the media that we now have access to. Even issues like the economics, stock market, and trade have spawned a slew of critically acclaimed films over the last few decades. For those interested in learning how to make a living in the stock market, here is a list of some of the top stock market movies. Since it is a long weekend, the best time to binge them is now. 1. Rogue Trader (1999) This film is based on a true story about a successful derivatives trader who took one too many risks, causing the bank where he worked to collapse. This film can help viewers comprehend how derivatives contracts work. 2. Wall Street (1987) Wall Street is a film about a young stockbroker who uses insider knowledge to earn a promotion and becomes involved in stock price manipulation and insider trading, all while avoiding being caught by the authorities. 3. Bazaar (2018) Bazaar is a thriller based on the life of a stock trader. Rizwan becomes caught in insider trading and shady networks after being hired for his trading expertise. It's a good look into what it takes to work in the stock market as a movie about the subject. 4. Inside Job (2010) It's a five-part documentary that looks at the banking practices and policies that led up to the 2008 financial crisis. This critically praised documentary delves into the real-life causes and ramifications of such a tragic incident. 5. The Big Short (2015) The Big Short is based on the real-life financial crisis of 2008, and it tells three stories: Michael Burry's successful fund endeavour, Jared Venett's entry into the CDS market, and how Geller and Shipley earn from shorting. It's a fantastic stock market film, and while it concentrates mostly on debt securities, it covers a lot of fundamental trading principles and offers viewers an idea of how unanticipated occurrences can affect the market. 6. Trading Places (1983) Trading Places is a lighter watch, a comedic stock market film about a con artist and commodity broker whose places are exchanged for the sake of a wager, and their revenge scheme on the two millionaires who placed the bet. 7. Gafla (2006) The film portrays a middle-class man's journey as he tries his luck in the stock market and becomes involved in a crime, which was inspired by a real-life swindle perpetrated by Harshad Mehta in 1992. 8. The Wolf of Wall Street (2013) The life and career of Wall Street stockbroker Jordan Belfort were depicted in this Hollywood blockbuster, which received critical praise. The film traces Belfort's journey from an entry-level position to massive losses due to Black Monday, to a pump-and-dump penny stock scheme, and finally to the launch of his new firm, which is probed by the US SEC and FBI. It is undoubtedly one of the best stock market movies, as it depicts the finance sector and its rotten underbelly. 9. Too Big to Fail (2011) Another film about the 2008 financial crisis, Too Big To Fail, focuses on the necessity of financial institution stability and how hazardous their failure could be for the entire economy. 10. Money Monster (2016) After Budwell loses all of his savings owing to the advice of a financial expert on a TV show, he pursues the expert and his team and holds them hostage in order to obtain information about the stock's decline. The film is a fantastic stock market movie to see since it emphasises the importance of not blindly trusting so-called market experts. To sum it up Real-life and art continue to be influenced by one another. While many of these stock market films deal with subjects such as corruption and criminality, they nonetheless teach us a lot about the market. By watching these wonderful films that provide some insight into the workings of the global markets, you may combine education and fun. Prospective investors can register a brokerage account online right now to get started on their financial adventure.

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Popular Indicators Used For Options Trading

Traders can use a variety of technical indicators depending on their trading style and the type of securities they are trading. This article focuses on a few key technical indicators that are often used by options traders. Options Trading can help you grow a small account into a much larger one. However, you can enjoy all of that with the lowest brokerage you can find for options trading. Zebu gives you this and more. As one of the best in the country, you also get the best trading accounts from us. Please get in touch with us to know more. What Makes Options Trading Unique In short-term trading, technical indicators are often used to help the trader in determining: Range of a move The movement's direction (which way?) How long will the price move? How long will the price move? The holding period is important since options are subject to time decay. A stock trader can keep a position indefinitely, whereas an options trader is limited by the option's expiration date and its term. Momentum indicators, which tend to detect overbought and oversold levels, are popular among options traders due to the time restrictions. Let's take a look at some of the most common indicators utilised by options traders, such as momentum and others. The Relative Strength Index (RSI) The relative strength index is a momentum indicator that compares the amount of recent gains to recent losses over a given period of time to determine overbought and oversold conditions in a security. RSI readings vary from 0 to 100, with a value more than 70 indicating overbought levels and less than 30 suggesting oversold levels. Individual stocks, rather than indexes, benefit from RSI because stocks exhibit overbought and oversold positions more frequently than indexes. The ideal choices for short-term trading based on RSI are options on highly liquid, high-beta stocks. Money Flow Index The Money Flow Index is a momentum indicator that takes into account both price and volume. Volume-weighted RSI is another name for it. The MFI indicator is a "trading pressure" indicator that gauges the entry and outflow of money into an asset over a given period of time (usually 14 days). A value of more than 80 suggests an overbought stock, while a reading of less than 20 indicates an oversold stock. MFI is more suited to stock-based options trading (rather than index-based) and longer-duration contracts due to its reliance on volume data. The MFI can be a leading signal of a trend change when it goes in the opposite direction as the stock price. Put-Call Ratio (PCR) The put-call ratio compares the amount of trade in put and call options. Changes in the put-call ratio's value, rather than its absolute value, indicate a shift in general market opinion. When the ratio of puts to calls is greater than one, it indicates bearishness. When call volume exceeds put volume by more than one, the ratio is less than one, suggesting bullishness. Traders, on the other hand, regard the put-call ratio as a contrarian indication. Open Interest The open or unsettled contracts in options are referred to as open interest. The OI may not always suggest a specific uptrend or downtrend, but it does give insight into the strength of a trend. Increased open interest signals new capital influx and, as a result, the continuation of the current trend, whereas dropping OI signals a weakening trend. While you take care of your options trading strategy, we take care of the rest. As one of the fastest-growing best trading accounts as well as the lowest brokerages for options trading To know more about our services and products, please get in touch with us now.

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An Overview of Volume vs. Open Interest

Volume and open interest are two of the most important technical metrics for understanding options and the broader market. The amount of contracts exchanged in a given period is referred to as "volume," whereas "open interest" refers to the number of contracts that are active, or not settled. We'll look at these two variables and give you some pointers on how to utilise them to better understand trade activity in the derivatives markets. But before we get into that, there is one thing you will require: the best Indian trading platform with a wide range of features. With Zebu, one of the best stock brokers in the country, your online stock trading journey will be drastically enhanced. Volume In the stock market, volume refers to the number of times shares are traded between buyers and sellers. The volume metric for options markets gives the number of options contracts bought and sold in a given trading day, as well as the degree of activity for a specific contract. Every transaction counts against the daily volume, whether it's an opening or closing transaction. The higher the volume, the more people are concerned about security. Volume is often used by investors to determine the strength of a price movement. More volume also suggests that the contract has more liquidity; this is advantageous in short-term trading because it means that there are more buyers and sellers in the market. Assume that the volume in call option ABC with a strike price of Rs 1000 and a three-week expiration date did not trade any contracts on a given day. As a result, the trade volume is zero. An investor buys 15 call option contracts the next session, and there are no other trades that day, thus the volume is now 15 contracts. The volume and open interest measurements reveal the amount of buying and selling that supports a prospective price change. In technical analysis, however, it is also necessary to determine whether the open interest is in calls or puts, as well as whether the contracts are being purchased or sold. Open Interest The quantity of options or futures contracts owned by active traders and investors is known as open interest. These positions have been created, but they haven't been filled, expired, or exercised yet. When buyers and sellers (or writers) of contracts close off more positions than were opened that day, open interest declines. A trader must take an offsetting position or exercise their option to close out a position. When investors and traders open additional new long positions or sellers take on new short positions in an amount bigger than the number of contracts that were closed that day, open interest rises once more. Assume that the open interest in the ABC call option is 0 for example. The next day, an investor opens a new position by purchasing 10 option contracts. The number of people who have expressed interest in this particular call option has now reached ten. Five contracts were closed the next day, ten were opened, and open interest grew by five to 15. Open interest, along with other variables, is used by technical analysts to determine the strength of a market trend. Increased open interest signals the entry of new traders into the market and can be used to corroborate a current market trend. The current trend may be deteriorating as open interest declines, indicating that traders are closing their positions. Particular Points to Consider We've listed a few situations that include the volume and open interest indicators, as well as some possible interpretations. Rising prices during an uptrend, combined with rising open interest, can indicate that new money is entering the market (reflecting new positions). If long positions are fueling the growth in open interest, this might be an indication of a bullish mood. If, on the other hand, open interest falls while prices rise during an advance, this could imply that money is leaving the market, which is a bearish indicator. If, on the other hand, open interest falls while prices rise during an advance, this could imply that money is leaving the market, which is a bearish indicator. Prices falling in a downtrend while open interest rises could indicate that new money is entering the market on the short side. This scenario is negative since it is consistent with a continuous downtrend. However, falling prices in a downtrend with declining open interest may imply that holders are being compelled to liquidate their positions, which is a bearish indicator. If open interest is high as prices are falling sharply during a market peak, it could be a bearish indicator if those who bought near the top are suddenly losing money; this could also create a panic selling scenario. Option Chain And Its Working An option chain is a table that lists all of the available options for a certain security. An option chain displays all of the published calls and puts for a given expiry date, organised by characteristics such as strike price, expiration date, volume, and pricing. How much open interest and volume should an option have? In general, a high volume and open interest both indicate a liquid market with a large number of buyers and sellers for a specific option. Market mood can also be confirmed by changes in open interest and volume. A rising price with increasing volume and open interest, for example, indicates a robust market, whereas a rising price with declining volume and open interest indicates a weak market. When the Volume Exceeds the Open Interest, What Does It Mean? If an option has a high volume but a low open interest, it has a limited secondary market, which means it may have low liquidity. A trader trying to sell that option might have trouble finding a buyer, or they might face a wider bid-ask spread than usual. What Does a High Open Interest Indicator Indicate? A huge number of traders have taken active positions in an options or futures contract with a high open interest. If open interest rises over time, it indicates that new traders are taking positions in the market and that money is flowing in. When open interest decreases over time, it indicates that traders are beginning to close positions.

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The Difference Between Large-Cap Stocks And Blue Chip Stocks

The market capitalisation of a company helps in determining its worth. It's computed by multiplying the number of existing shares by each share unit. The market capitalization of large-cap firms exceeds Rs.20,000 crores. The NIFTY 50 index contains the top 50 large-cap firms in India. This index includes the most actively traded companies on the stock market. Large-cap firms' stock prices cannot appreciate as much as mid-cap and small-cap companies' stock prices. This is due to the fact that large-cap company valuations have attained financial maturity. Dividend payouts account for the majority of such equities' returns. Because there is always someone willing to purchase such well-known and popular stocks, large-cap businesses provide significant liquidity to their investors. On the stock exchange, blue-chip stocks are highly valued. They have a strong market reputation and a solid financial track record. Blue-chip stocks are frequently referred to as the stocks of the largest corporations in the economy. However, before you start investing, it is important that you do so with one of the best share brokers in the country. At Zebu, we have the lowest brokerage for investments and also support you with a highly advanced online trading platform to help you analyse stocks and execute your trades. The primary distinction between large-cap and blue-chip firms is that the latter is the market leader. Blue-chip stocks are well-known in addition to having a significant market capitalization. Large-cap corporations can be well-known or not, whereas blue-chip companies must be well-known. Blue-chip enterprises are well-known in the marketplace and hence have a high brand value. A blue-chip company's stock has reached its maximum growth potential. As a result, blue-chip investors see a slow but consistent increase in their invested capital over time. Because the firms that issue these stocks have many sources of income and have spread their operations to multiple industries, blue-chip stocks can help you diversify your portfolio rather well. As a result, they are less vulnerable to market volatility, making them a low-risk investment alternative. By diversifying your investments even more, you can further lower your risk exposure. During peak business cycles, large-cap corporations are often blue-chip companies because they generate consistent revenue. When compared to blue-chip corporations, large-cap companies are a riskier investment alternative. Despite having a huge market capitalization and good revenue, large-cap corporations have yet to stabilise on such business peaks and maintain them in the long run. Two of the most important checklists for first-time traders and investors are the right online trading platform and the lowest brokerage for investments. As one of the best share brokers in the country, we at Zebu will give you all of this and more. To know more about our services and products, please get in touch with us now.

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A Quick Commentary On India’s Sovereign Green Bonds Worth $3.3 Billion

There's an interesting backstory behind India's sovereign bond issuance. The idea was approved in the Union Budget around two years ago, with a goal of raising up to $10 billion through sovereign bonds. Internal opposition grew, and the proposal was eventually scrapped after the PMO interfered. In this context, the Indian government's recent plan to issue $3.3 billion in sovereign green bonds is significant. Sovereign green bonds are similar to any other government-issued sovereign bond. The only difference is the use of the cash raised, which can only be used for activities and initiatives that reduce carbon emissions, such as renewable energy, green hydrogen, and rechargeable batteries. These green bonds have a reduced cost of capital because they provide carbon neutrality benefits to their buyers. The problem is likely to debut in the market in the first or second quarter of FY23, with the finer specifics to be revealed later. This will be the first tranche, and if there is sufficient demand for green bonds, the centre may consider selling more than $3.3 billion in green bonds. This problem represents a significant shift in the Indian economy's commitment to a low-carbon future. Costs and other details are still being worked out. To some extent, India's venture into green bonds mitigates the risk of sovereign bonds. Because sovereign bonds are usually denominated in hard currencies like the US Dollar or the Euro, they tend to increase the issuer's liabilities if the native currency falls. This step will also help India achieve its objective of becoming carbon neutral and net-zero emissions by the year 2070. While the 10-year benchmark sovereign bond yield is currently about 6.85 percent, the government expects to be able to borrow at a lower rate through green bonds. That will be the key draw, because it may not make sense for India to take on the risk of national debt unless the difference is large enough. This is in line with the global surge in renewable energy, sustainable business models, and sustainable strategy. Indian conglomerates such as Reliance and Adani have committed billions of dollars to green projects such as renewable energy, green hydrogen, electric vehicle batteries, and electric vehicle ecosystems. India, the world's third-largest emitter of greenhouse emissions, wants to double its renewable energy producing capacity by 2030. The timing is right for the launch, with global investor and lender enthusiasm for green firms at an all-time high.