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RichVee
#1 Posted : Thursday, February 18, 2010 10:50:28 AM
Rank: Member


Joined: 1/26/2010
Posts: 124
I was the perfect candidate for beginners luck, having bought shares using no brain activity at all, except for knowledge of some companies that i was interested in.I would buy, then completely forget about my purchase, and the next time i would check, the prices were high!

Except for a few cases. Looking back, I have been able to see where I made some mistakes - like buying stocks when the prices were very high (I did not look at the history of the share, to tell where the prices were headed- up or down )

So a quick Q. Has there been a trend on NSE for prices to go down around Feb/March, and what can this trend be credited to? ( my assumption is based on year 2009...
Tired of mediocrity. Am going to the very top!
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guru267
#2 Posted : Thursday, February 18, 2010 11:14:44 AM
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Joined: 1/21/2010
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@Richvee i would like to say that you are very mistaken...
there is no trend that makes share prices drop during feb/march...
the worst of the financial crisis hit the world at the beginning of 2009 and most stock markets around the world including the NSE fell to their lowest around march 8th-11th and that was the reason for last years fall..
after those days any one could have put money in any counter and they would be up at least 50%..

but beware when a market recovers like it has now one should pick ones stocks with extreme CAUTION and CARE or else one will be burned..

Mark 12:29
Deuteronomy 4:16
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RichVee
#3 Posted : Thursday, February 18, 2010 11:28:39 AM
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guru267 wrote:
@Richvee i would like to say that you are very mistaken...



he he he. I just love those trend lines. Now ofcourse I know better - like I said, I am doing more analysis, plus picking on braincells like yourssmile
Tired of mediocrity. Am going to the very top!
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Much Know
#4 Posted : Thursday, February 18, 2010 11:37:12 AM
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Joined: 12/6/2008
Posts: 3,548
There is a trend called january stock effect where stocks rally in jan, it has failed less than ten times in the last hundred years, now think how this would impact feb and march.
A New Kenya
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guru267
#5 Posted : Thursday, February 18, 2010 11:49:51 AM
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@Muchknow
i know about the january trend.. it happens because most traders and investors are trying to make up for lost time in december and trying to take positions for the year...
but i'm not aware of this having any negative effect on feb and march.. please explain???
Mark 12:29
Deuteronomy 4:16
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mkonomtupu
#6 Posted : Thursday, February 18, 2010 12:12:35 PM
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Joined: 2/10/2010
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It has everything to do with the government budget. A lot of business depends on the government spending. In Feb/March usually the government goes for the supplementary budget most ministries having spent the allocations. In April to May ministries want to exhaust the allocation so a lot of cash in the economy. The period Aug-Oct also has a dip. That's also the period when armed robberies increase. If you are in jua-kali you notice some periods when people are flush with cash.
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guru267
#7 Posted : Thursday, February 18, 2010 12:30:15 PM
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@mkonomtupu
i've failed to understand how your explanation affetcts the STOCK EXCHANGE... does the govt allocate money for buying shares in its budget??? your explanation has alot to do with the general level of economic activity in kenya but nothing to do with the stock exchange....


Mark 12:29
Deuteronomy 4:16
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Much Know
#8 Posted : Thursday, February 18, 2010 12:36:00 PM
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@guru, i would expect a downward correction at least in feb, just thinking ama?
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McReggae
#9 Posted : Thursday, February 18, 2010 12:42:50 PM
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Joined: 6/17/2008
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guru267,
The govt suppliers get paid and some of them put this money into stocks, think mkonomtupu was thinking in that line!!!
..."Wewe ni mtu mdogo sana....na mwenye amekuandika pia ni mtu mdogo sana!".
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mkonomtupu
#10 Posted : Thursday, February 18, 2010 12:47:21 PM
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Guru, MJ said kenyans have peculiar calling habits. The same for trading. A lot of cash is pumped in almost the same time each year. If the government pays its bills people have a little to spare and the cash find itself into the stock exchange. Fund managers a.k.a institutional investors also rebalance portfolio and close their books in almost similar fashion. There are always periods when it's good season to enter the market when people are cash-strapped.
I don't have hard statistics but i know when not to chase my pending invoices.
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Much Know
#11 Posted : Thursday, February 18, 2010 12:51:10 PM
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Guru, global crises took off beggining third quarter 2008 and was firmly in effect by end of 2008
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guru267
#12 Posted : Thursday, February 18, 2010 1:08:51 PM
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@much know.. the crisis started all the way in the 4th quarter of 2007 but it went global after the lehman brothers collapse in september 08...
so it was firm by jan.. thats why i said the WORST of the crisis was at the beginning of 09...
stock markets around the world really started to fall in jan 09 and then they all hit there lows in march.. the NSE wasnt spared...

and to answer your question about the feb correction i ask you a question... how can markets correct or dip in feb and march when these months are full of company announcements and results???
Mark 12:29
Deuteronomy 4:16
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guru267
#13 Posted : Thursday, February 18, 2010 1:33:14 PM
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@mkonomtupu.. i hear your point loud and clear... but we may just have to agree to disagree... but i will be watching the NSE on the months which you stated for dips and wait to be proved wrong///
Mark 12:29
Deuteronomy 4:16
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Wa_ithaka
#14 Posted : Thursday, February 18, 2010 1:48:44 PM
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Feb and March is when results are typically announced. If you are a trader you ride a wave from November all the way to the beginning of Feb and then you bail until April when you pick up the button again.
The Governor of Nyeri - 2017
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RichVee
#15 Posted : Thursday, February 18, 2010 2:02:37 PM
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So my observation had a point (or 2)...I only started analyzing share prices since Jan 09 and will continue to study. It is always good to hear others opinions/facts.
Tired of mediocrity. Am going to the very top!
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guru267
#16 Posted : Thursday, February 18, 2010 2:13:27 PM
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Wa_ithaka wrote:
Feb and March is when results are typically announced. If you are a trader you ride a wave from November all the way to the beginning of Feb and then you bail until April when you pick up the button again.


@wa_ithaka.. most traders do trade to make both capital gains and dividends.. so i dont understand how a trader can bail in feb yet company books opening for dividend payments open in late feb and march... expalain to me your reasoning behind this please??
Mark 12:29
Deuteronomy 4:16
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VituVingiSana
#17 Posted : Thursday, February 18, 2010 3:25:25 PM
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Joined: 1/3/2007
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The so-called January trend might be prevalent in DEVELOPED markets coz the 'year-end' for funds (who offload positions for tax gains/losses) is 31 Dec.

I doubt that is as pronounced on NSE where only a tiny portion of shares are ever traded.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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sparkly
#18 Posted : Thursday, February 18, 2010 3:55:40 PM
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Joined: 9/23/2009
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guru267 wrote:
i ask you a question... how can markets correct or dip in feb and march when these months are full of company announcements and results???

I started investing in the exchange in 2001 when the system was still manual. Even then i noticed that the prices go down in feb and march just before the announcements but then quickly pick up towards the book dates and peak around june. I dont know of any logical explanation.
Life is short. Live passionately.
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Wa_ithaka
#19 Posted : Thursday, February 18, 2010 4:15:04 PM
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Guru267-the highest dividend yield on the NSE is 14%. A trader entering a typically high dividend yield share in November can expect to make 25% before or after charges by the time they exit in Feb/March time.
During a typical NSE year (i.e. minus political stresses), you can observe this trend on shares like Williamson, StanChart
The Governor of Nyeri - 2017
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Much Know
#20 Posted : Thursday, February 18, 2010 4:39:57 PM
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Joined: 12/6/2008
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@vv$, but you know 'mkolo' controls our market, with all due respect to your exceptional analytics, if there is such a word.
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