Author: Vineet Rajani


 

Give me some sunshine; give me some capital

My 20-year-old cousin took a fancy to the stock market recently. I would like to take credit for his excitement, given my employment at Zerodha, but I am aware he is just joining the trading wagon with his friends and social media connections. I am glad that he is curious about concepts. He asks me […]

Content, Zerodha Varsity
0
09 Apr 2024
 

Underlining the Underlying Exposure

The RBI requires anyone trading in currency derivatives to have an underlying exposure to forex. It seems many market participants were not aware of this. So, the RBI recently reinforced this requirement through a recent circular. The deadline to ensure that users participating in currency derivatives have an underlying exposure was set at 05 April […]

Content, Zerodha Varsity
3
05 Apr 2024
 

Why Contribution Profit is a Big Deal?

Let’s say you want to put up a lemonade stand at a college fest. The rent for this stand is 10,000. The cost of making a lemonade with lemon, syrup, soda, and ice is 25. You plan to sell it for 50 per glass. How many lemonades should you sell to make profits or break […]

Content, Zerodha Varsity
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16 Feb 2024
 

Nestle India split its shares. Will MRF ever split?

Nestle India split its stock in a ratio of 1:10 on Jan 05. Each share of a whopping ₹27,000 converted into ten shares of ₹2,700 each. At ₹2,700, the shares became a lot more attractive to a larger set of investors, especially retail investors. The move will perhaps improve the stock’s liquidity. That begs a question – why can’t MRF consider a split?

Content, Zerodha Varsity
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05 Jan 2024
 

What could ruin the party for an all-time high Nifty?

In the blink of an eye, the year 2023 is wrapping up. After gaining about 5.5% in November 2023, the Nifty 50 index is hovering near its all-time high. There will be many bull case scenarios suggesting a rally higher up. But let’s look at the bear case and figure out the factors that can potentially drag the markets down.

Content, Zerodha Varsity
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01 Dec 2023
 

The Dark Side of the Big Fat Indian Wedding

Beti ki shadi se bada baap ka kya farz hota hai? A father’s biggest duty is his daughter’s wedding. Two fathers, one spending ₹2.5 Cr and the other spending ₹6 lacs on their respective daughters’ weddings, make this statement in an episode of Made in Heaven on Prime Video. The show is about big fat […]

Content, Zerodha Varsity
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21 Nov 2023
 

How to forecast the economy? Economic Indicators could help

What are Economic Indicators? A basket of factors that help forecast how an economy will perform in the future. Economic forecasting is used by Businesses to plan investments and operations and estimate performance Investors to adjust portfolio allocations and expected returns Govt and regulators to make policies for the public, businesses, and investors Consumers to […]

Content, Zerodha Varsity
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17 Nov 2023
 

Hope is not a strategy

A few years ago, I came across a microcap real estate stock. It got ownership of hundreds of acres of land parcels in multiple cities as part of a PSU restructuring. The plan was to develop residential and commercial buildings on these land parcels. Given the value of the land it owned, the stock looked […]

Content, Zerodha Varsity
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11 Oct 2023
 

Stock market scams and how to avoid them – How the elderly are scammed?

Remember Yes Bank’s AT1 bonds that were written off when the RBI forced a reorganization of the bank in 2020? Many elderly people lost their retirement savings in AT1s. AT1 bonds are pseudo-equity bonds. They pay higher coupons than regular bonds or FDs. However, when a bank suffers losses, AT1 bonds are the first ones […]

Content, Zerodha Varsity
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07 Oct 2023
 

Stock market scams and how to avoid them – Phishing Trading Accounts

“Click here to win an iPhone for INR 1,000!?” “Your broking account funds are blocked. Click here to update KYC.” “Beware of frauds. Secure your credit card XXXX on this link.” Ever clicked on messages or emails like these? They will usually have a link that will take you to a homoglyph website. A homoglyph […]

Content, Zerodha Varsity
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05 Oct 2023
 

Stock market scams and how to avoid them – Pump and Dump

Several stocks have given 1000% returns within a few months. Who could have predicted that kind of rally for any stock? Hardly anyone. Most rallies are a surprise. However, many people do predict massive gains for various stocks. Several channels and groups on YouTube, WhatsApp, and Instagram make tall predictions. This ₹20 stock will go […]

Content, Zerodha Varsity
0
04 Oct 2023
 

Trading Holiday Vs Settlement Holiday

Today, 29 September 2023, is an unusual day in the financial markets. It is a trading day for all financial instruments but a settlement holiday for some. Quarter-end has added to the confusion. Why so? The Government of Maharashtra moved the public holiday for Eid-e-Milad from 28th September to 29th September. So, the Clearing Corporation […]

Content, Zerodha Varsity
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29 Sep 2023
 

How is inflation 6-7% when veggies shot up 50-100%?

A simple Google search of “no tomato recipes” will show a variety of preparations without tomatoes. You could also find a lot of “no onion recipes.” People generally search for such recipes when tomato or onion prices shoot up. Retail inflation was 7.4% in July 2023 and 6.8% in August 2023, mainly driven by food prices, especially […]

Content, Zerodha Varsity
0
18 Sep 2023
 

The compounding effect is not linear!

The Nifty 50 Total Returns Index (TRI) delivered a 10.36% CAGR between Mar-08 and Mar-23. ₹1 lakh invested in Mar-08 would have become ₹4.4 lakh in the 15 years through Mar-23. Does that mean, at a 10.36% compounded rate, your investment in Nifty 50 would have grown steadily year after year? Meaning, would your INR […]

Content, Zerodha Varsity
0
18 Sep 2023