| Utility and commercial vehicle maker Mahindra & Mahindra (M&M) will spend Rs 2,250 crore in the next two years to develop new vehicles to be rolled out by 2009 end. |
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| The company has been developing four new platforms simultaneously in the utility and multi-purpose vehicle space aimed to further strengthen its presence in the non-car market. |
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| The company has two highly successful offerings in this segment – Scorpio and Bolero. |
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| Of the Rs 4,500 crore investment planned for the company’s Chakan project, which is a part of the company’s planned capital expenditure of Rs 6,400 crore till 2010, about Rs 2,250 crore will be used to fund development of new vehicles including the Ingenio, a premium sports utility vehicle (SUV), a pick-up and a mass market platform. |
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| Pawan Goenka, president (automotive sector), Mahindra & Mahindra, said, “Our new products due to debut in the next two years will be fully developed by us and sold in the Indian and overseas markets. The products will help us move up the value chain and boost our dominance in the utility vehicle space.” |
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| The Ingenio multi-purpose vehicle (MPV), which so far has seen an investment of Rs 550 crore, will be the company’s most ambitious project after Scorpio, launched six years ago. |
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| According to company officials, the vehicle was due for launch in the current financial year, but has been sent for further upgradation following increased competition. |
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| The premium SUV project will be based on a completely new platform targetted at the Rs 14-18 lakh price bracket. |
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| The aim is to have a presence in the premium SUV segment, which has so far seen a growth of more than 60 per cent this year. The segment has been dominated by players such as Ford (Endeavour), Honda (CR-V) and Toyota (Land Cruiser Prado). |
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| Although the SUV segment is small in size, at 1,200 units a year in the domestic market, the demand for fuel-efficient SUV’s globally in markets such as Europe and the US is very upbeat. |
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| M&M will launch its SUVs in the US in 2009, while Scorpio, christened as Goa, is sold in the European market. |
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| The mass market platform will address the demand for cargo movers designed to handle goods as well a passenger carrier too. The company is also looking at the pick-up market and planning to have a significant presence in the segment, according to sources. |
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| An analyst said, “The overall market for pick-up vehicles in India is 1.5 lakh units which would maintain a steady growth of 21 per cent till FY10. So there is a huge potential to be tapped in this category. In the northern region, there is demand of 22,000-25,000 pick-up vehicles annually.” |
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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