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Thursday, January 17, 2008

Google, Khosla in race to build 42 kmpl car

AUTOMOBILES Companies are developing new engine technologies to deliver the ultimate in fuel efficiency

The race to launch a 100-mile-per-gallon (42 km per litre; on the US scale 3.8 litres = one gallon) car the world over is hotting up, even as Ratan Tata has lowered the global bar for launching the cheapest car that should deliver around 20 kmpl.

The participants range from an IT giant like Google to prominent venture capitalists like Pune-born Vinod Khosla — founder of Khosla Ventures.

Also one of the co-founders of Sun Microsystems, Khosla is betting big time on start-up green ventures. Driving a Lexus Hybrid himself, he has made at least 10 bio-fuel bets over the last 15 years.

For instance, in 2006, Khosla had invested around Rs 800 crore in Cilion Goshen (a company that converts corn into ethanol to power cars and trucks), and around Rs 120 crore in Mascoma Corporation, a producer of biofuels from lingo-cellulosic biomass using micro-organisms and enzymes.

On January 12, he made an investment for an undisclosed amount in EcoMotors — an automotive company with a focus on fuel efficiency, low emissions and cost-effective solutions for developing markets.

EcoMotors has developed an innovative diesel engine that is aiming at delivering 100 miles per gallon (mpg) by 2011.

Vinod Khosla is targeting the rising demand for cars in developing countries, including India. “We’re focusing on powering the automotive fleet of tomorrow with fuel-efficient building blocks,” he said.

“This investment complements our company’s other investments in the engine space. The companies we have invested in are at the forefront of forming a serial plug-in hybrid platform with our multiple investments in the new battery technology,” Khosla added.

Meanwhile, several small companies are developing new engine technologies and advanced automotive designs that promise to deliver the 100-mpg promise. The proposals run from the simple reduce weight, improve aerodynamics to borrowing ideas from jet engines.

Meanwhile, Google.org is modifying gas-electric hybrid vehicles like the Toyota Prius to try to breach the 100 mpg threshold. The project, called Recharge IT, is collaborating with other companies and researchers, including Pacific Gas & Electric.

They have handed out $1 million in grants to think tanks, educators, advocacy groups and researchers to advance the hybrid cause. Another $10 million is available to researchers who offer worthy proposals.

RechargeIT is a Google.org initiative that aims to reduce CO2 emissions, cut oil use and stabilise the electrical grid by accelerating the adoption of plug-in hybrid electric vehicles and vehicle-to-grid technology.

The new Corporate Average Fuel Economy (CAFE) standards in the US will require all manufacturers to improve fuel economy by 40 per cent, beginning 2011, and the 2010 Environmental Protection Agency (EPA) standard is forcing all diesel manufacturers to invest heavily in the new emission technology.

The real challenge, though, is creating a consumer-friendly car that’s attractive, reasonably-priced and capable of delivering the 100-mpg promise, according to experts.

The race has become more intense with the X Prize Foundation — the group that kickstarted the space-tourism industry with its $10-million competition to produce a reusable private spacecraft — announcing an estimated $25 million (around Rs 100 crore) prize for the 100-mpg car. The participants can use different types of fuels — natural gas, ethanol, diesel or even electricity.

Entrants are expected to use strong, lightweight materials such as aluminum, carbon fibre and magnesium to lighten the car’s body, electronics and wheels. Various types of lightweight glass and composites are being developed for the purpose.

Aerodynamic designs and low-resistance tyres would decrease drag (can decrease handling too); and improved insulation would reduce the need for heating and cooling systems, which would cut down on weight and save fuel, though the Automotive X Prize requires entrants to have some sort of air-conditioning system as well as a stereo. The results will be out by 2009-end.

Posted by Srivatsan at 10:22 AM

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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.