Author: shyam

Banks: Straight Line Growth?

We recently added historical quarterly EPS charts on our equities page it has started throwing up some interesting questions. Consider IndusInd Bank [stockquote]INDUSINDBK[/stockquote] for example:

IndusInd Bank EPS chart

The bank has had an almost unbroken streak ever since it started reporting results (from back in 2007 July) and the stock has basically gone from Rs. 50 to Rs. 400 in the same period… a 40% IRR + dividends, if you had just bought the stock and sat on it for 6 years.

A similar story seems to have played out in Yes Bank [stockquote]YESBANK[/stockquote] as well:

Yes Bank EPS chart

And Axis Bank [stockquote]AXISBANK[/stockquote]:

Axis Bank EPS chart

Most private banks more or less have the same story. Incredible how in spite of the economy experiencing multiple head-winds – slowing growth, the Lehman event, etc. banks have been ringing it in…

 

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Machine Learning Stocks, Part II

We had previously rolled out the “similar stocks” feature that grouped stocks based on risk and technical parameters. The idea of grouping/clustering stocks is that it allows you to find better alternatives to your favorite stocks. We combined machine learning with our Fundamental Quantitative Scores to cluster stocks based on fundamental metrics.

For example, here’s what Glenmark’s looks like:

Glenmark

 

Related:

Machine Learning Stocks
Quantitative Value Series
StockViz Trading/demat Account
Fundamental Quantitative Scores for Stocks

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Weekly Recap: Opiate for the masses

nifty heatmap

The Nify rallied +3.20% (3.62% in USD) as investors chose to ignore the gloom-and-doom surrounding realty and focused on the positives in IT.

Index Performance

index performance

Top winners and losers

ADANIENT +10.79%
RANBAXY +10.80%
DLF +11.06%
COALINDIA -8.87%
GODREJCP -5.49%
HINDALCO -3.22%
It appears that recovery trade is getting underway…

ETFs

BANKBEES +3.79%
PSUBNKBEES +3.70%
JUNIORBEES +3.25%
NIFTYBEES +3.12%
INFRABEES +2.91%
GOLDBEES +0.63%
Bank ETFs rallied and it looks like PSU banks are turning the corner – thanks to Prof. Rajan…

Advancers and Decliners

advancers and decliners

Yield Curve

Yields are down on the back of internationalization efforts of the RBI. Although much work needs to done, the markets seem to be giving RBI the benefit of the doubt…

yield curve

Interbank Rates

… and banks are lending freely to each other, as evidenced by the falling MIBOR rates.

interbank rates

Sector Performance

sector performance

Thought for the Weekend

Does social media keep people confused, misled and doped up? Social media keeps us engaged in the activities of semi-imaginary role playing and distracts us from events and action in the real world. As long as we’re busy pretending to be cool or acting outraged online, we won’t be fully present or even really care about legitimate problems. In giving us a chimerical outlet to speak our minds, get distracted playing a role in a game, and get our fix of dopamine, social media is the perfect opiate for keeping the masses deluded and powerless.

Source: The perfect opiate for the masses

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Fundamental Quantitative Scores for Stocks

We are big fans of quantitative investment strategies, here at StockViz. The primary reason driving our obsession is that they work! They work because they impose discipline and gives us a framework to measure risk-adjusted returns. As a sign of our unwavering focus for providing our clients with an investment edge, we are now making our Fundamental Quantitative Scores for Stocks accessible to our trading/demat clients.

Fundamental Quantitative Scores rank each stock based on a single metric: for example, Return on Capital (ROC), Leverage, Total Accruals To Total Assets, etc. These ranks provide a snapshot of how the company is doing vs. all the other investment options out there.

Here’s a screenshot for Glenmark:

quantitative fundamental scores for glenmark

A couple of these metrics (Earnings Yield and Book to Market) are price based (and hence the blue highlight). The scores also indicate the total number of stocks that were analyzed on that metric. For example, Glenmark is ranked 748 out of 957 on Sales Growth Index. We’ll be discussing each of these metrics over the next couple of weeks.

 

Related:

Machine Learning Stocks
Quantitative Value Series
StockViz Trading/demat Account

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