| Plans electric car launch for Europe with Austrian mobike maker. |
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| Bajaj Auto is looking at acquiring a car company to break into the higher segments of the market as part of its long-term passenger car strategy. |
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| The company is also developing an electric car jointly with Austria's KTM Sportsmotorcycle AG, in which it recently bought 22 per cent. |
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| The company, which unveiled its small car yesterday, has also decided that it will not make cars in the B (Zen, Alto) and C (City, Verna) segments of the market. |
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| Speaking to Business Standard, Managing Director Rajiv Bajaj said: “The strategy of a company is best illustrated by what it decides not to do.” |
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| He added that Bajaj had expertise in light vehicles and, therefore, will build only a small car. |
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| “For bigger cars we can acquire a company that does this best rather than doing it ourselves. And there are many companies available to do so,” he added. |
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| Bajaj also said the company is targeting a pre-tax margin of 10 to 15 per cent on the car project. |
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| On the electric car, Stefan Pierer, chief executive officer of KTM, which makes high-end bikes, said: “Electric cars have a bright future especially with many European cities now restricting entry of petrol cars for a certain period every day to reduce pollution and congestion. We are talking about how we can provide 'urban mobility' in Europe”. |
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| Added Bajaj: “Urbanisation and oil at $100 have become big issues and we are creating solutions to address this.” |
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| Elaborating on his claim that his company's target is to make a car that will yield double the fuel efficiency of current small cars Bajaj said, “Most of the small cars give an on-road mileage of 15 to 20 km a litre. We are looking at a car that will give between 30 and 40 km to a litre.” |
Understanding Short Term Trading
Before I begin, this blog is not for intraday traders. My definition of short term implies duration of around 2 to 3 months.
Short Term stock picking is no rocket science, but rather a visual interpretation of technical charts. A basic moving average on a time frame chart will show the direction of the securities movement.
Moving averages is a mathematical results calculated by averaging a number of past data points. Moving averages (MA) in it's basic form is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. Once the value of MA has been calculated, they are plotted onto a chart and then connected to create a moving average line. Typical moving averages used for short term trading are 50 MA and 100 MA.
Types of Moving Averages
1) Simple Moving Average (SMA)
SMA is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. The usefulness of the SMA is limited because each point in the data series is weighted the same, regardless of where it occurs in the sequence. Critics argue that the most recent data is more significant than the older data and should have a greater influence on the final result.
2) Exponential Moving Average (EMA)
EMA overcomes the limits of SMA, where more weight is given to the recent prices in an attempt to make it more responsive to new information. When calculating the first point of the EMA, we may notice that there is no value available to use as the previous EMA. This small problem can be solved by starting the calculation with a simple moving average and continuing on with calculating the EMA.
The primary functions of a moving average is to identify trends and reversals, measure the strength of an asset's momentum and determine potential areas where an asset will find support or resistance. Moving averages are lagging indicator, which means they do not predict new trend, but confirm trends once they have been established.
A stock is deemed to be in an uptrend when the price is above a moving average and the average is sloping upward. Conversely, a trader will use a price below a downward sloping average to confirm a downtrend. Many traders will only consider holding a long position in an asset when the price is trading above a moving average.
In general, short-term momentum can be gauged by looking at moving averages that focus on time periods of 50 days or less. Looking at moving averages that are created with a period of 50 to 100 days is generally regarded as a good measure of medium-term momentum. Finally, any moving average that uses 100 days or more in the calculation can be used as a measure of long-term momentum.
Support, resistence and stoploss can be infered by referring the closet MA below or above the market price. The other factor that is used in short term momentum is the trading volume. The moving averages along with the trading volume can provide a better insight to short term movement.
Markets are moved by their largest participants - I believe this is the single most important principle in short-term trading. Accordingly, I track the presence of large traders by determining how much volume is in the market and how that compares to average. Because volume correlates very highly with volatility, the market's relative volume helps you determine the amount of movement likely at any given time frame--and it helps you handicap the odds of trending vs. remaining slow and range bound.
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