Pair Strategy Long IOC & Short BPCL

PAIR STRATEGY
  • Pair Strategy is taking a long short position within a sector on a market neutral basis based on the price ratio movement of the stocks.
  • This strategy takes on advantage when there is dispersion in the current ratio of the two correlated stocks.
  • The positions are squared off when the relative prices return to their averages mean.

Long IOC and Short BPCL (CMP & M Cap taken on Apr02, 09):
IOC (LONG) BPCL (SHORT)
NSE Code IOC BPCL
Spot Rs 405.15 Rs 372.90
Future Price Rs 405.85 Rs 375.85
M-Cap Rs cr 48309.05 Rs cr 13481.9
3Months High Rs 466.90 Rs 423.30
3 Months Low Rs 354 Rs 329.50

Comments

Post a Comment

Popular posts from this blog

Global Markets, RBI Policy Review Will Dictate Trend (Oct20-25)

Concerns about a Global Recession may continue to weigh on the domestic bourses, which have tumbled in a global equities rout in the past few days. Lack of buying support has accentuated the decline on the bourses Foreign institutional investors (FIIs) continue to press sales. They have sold shares worth Rs 46,661.20 crore in the calendar year 2008 so far (till 16 October 2008). Investors now await the Mid-Term Monetary Policy Review by the Reserve Bank of India (RBI) due on 24 October 2008. Some reports suggest that RBI is set to cut the repo (repurchase) rate by a steep 50 basis points, to signal a strong shift in policy focus to growth from inflation. Repo rate is the rate at which RBI provides funds to banks against the collateral of government bonds for a day to three days. On the inflation front, experts feel that the wholesale price index is expected to move downward, and will eventually come down to single-digit numbers by January 2009. Inflation based on the whole price index ...
Read more

Macro Economic View on Stock Market (Short As Well As Long Term )

Dear All, Who -so-ever have interest in share market- current ongoing last few trading days were very confusing including today - but let me tell you, it was not like so. Following the ongoing election and the fund needed by different political parties and dismal performance by corporates (companies) in the last 2-3 quarters and also in coming 1-2 quarters, corporates were and are not in the position; as they were in the last election; but parties need fund. Now one of the ways that can assure them very good funds is share market. So what is happening in the market is, it is defying all the global cues for last 15 trading sessions and especially since the start of the election on Apr 18,09. Every day it is taking an almost u-turn in between start and close of the market. The market has turned as much volatile that no fundamental can be applied and behaving almost irrational and without any logic to support the volatility. The market is behaving like monthe expiry has approached. Its n...
Read more

Fundamental Call On Dec08,08

Buy Jhunjhunwala VanaspatiWith Short as well as Long Term View Co Name: Jhunjhunwala Vanaspati Ltd Reco: Buy CMP: Rs 72 (Dec05,08) Best Buy Level: Dip around Rs 65 (accumulate at or below this level) Target Price: Rs 82-85 (1-3 months), Rs 120(12-18) months Investment Rational: 1. Fundamentally, The company performance is quite consistant and it is registering very impressive growth in its Top Line ( Net Sales) and Bottom Level (PAT) of around 50% and 70% consequtively on average basis. It has EPS of Rs 48 (approx) so PE of 1.5 and BV = Rs 132. 2. 58% of its earnings comes from vanaspati oil and rest from soya, palm and Mustard oil. And, it has 35-40% market share in UP and Bihar. And, it has increased its market share over period of time. At the same time. the company has plans to increase its total capacity and to establish nes units in Bihar and West Bengal as well. Moreover, It has taken over a fertilizer comapany in Bihar to enter in Fertilizer segment.
Read more