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SECURITY ANALYSIS

Presented by:

S.Anusha

V. Jyothsna sowgandhiMIC College of Technology

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CONTENT

Introduction to stock exchange

Security meaning

Types of securities

Security analysis types

fundamental analysis

Technical analysis

Conclusion

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STOCK MARKET

Stock Exchange also called Stock Market or

Share Market

market forces.

Stock markets started in 1881.

Totally 21 stock exchanges in India.

National stock exchange and Bombay stock

exchanges are famous stock exchanges.

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SECURITY

According to securities contract act 1956 , has

defined the security as inclusive of shares,

scripts, bonds , stocks , debentures (or) any

other marketable securities of like nature.

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TYPES OF SECURITIES

Securitiesmarket

Shares

Equity shares

Preferenceshares

Debt

Government

securities

Debentures

Bonds

Derivatives

Futures

Options

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EQUITY SHARE CERTIFICATE

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PREFERENCE SHARE CERTIFICATE

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BOND

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DEBENTURE

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DERIVATIVES

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SECURITY ANALYSIS

The analysis of various tradable financial

instruments is called security analysis.

It is the initial phase of the portfolio

management process. This step consists of examining the risk-return

characteristics of individual securities.

Buy under priced securities and sell overpriced securities.

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TYPES OF SECURITY ANALYSIS

Security analysis

Fundamental analysis Technical analysis

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FUNDAMENTAL ANALYSIS

It is a logical and systematic approach.

The fundamental factors are relating to EIC

analysis framework

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EIC analysis framework

Fundamentalanalysis

Economyanalysis

Industryanalysis

Companyanalysis

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ECONOMY ANALYSIS

Factors including while making economy

analysis

GDP

Interest rates

Inflation

Exchange rates

Government revenue , expenditure and deficits

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INDUSTRY ANALYSIS

Industry life cycle

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There are 24 sectors in Indian industry. They

are

Banking sector

Information technology sector

Pharmaceutical sector Agriculture sector

Real estate sector

Telecommunication sector

Textiles sector

Media sector

Auto mobile sector etc.

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COMPANY ANALYSIS

Profit volume ratio (P/E ratio):-

Market price /Earnings per share(EPS)

Earnings per share(EPS):-

Net Profit Available To Equity Shareholders/Number Of Shareholders

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EXAMPLE ON FUNDAMENTAL ANALYSIS

Sno. Company Fundamental analysisP/E NPM EPS

1 Wipro 16.24 14.9 23.65

2 Bharti Airtel 26.44 3.9 10.01

3. Cipla 23.34 20.5 15.83

4 ITC 30.82 23.9 8.22

5 L&T 20.86 7.5 74.37

6 NTPC 14.45 15.5 11.70

7 ONGC 8.86 30.1 31.688 DR.REDDY

S

18.96 13.2 88.15

9 HDFC 28.94 20 26.91

10 AXIS Bank 9.8 17.8 107.50

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TECHNICAL ANALYSIS

A technical analyst tries to identify the

historical patterns from the chart, based on this

he/she is going to forecast the future price

movement.stages in technical analysis:

Collecting data

Represent in charts

Evaluation of historical patterns

Forecasting the prices

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TYPES OF CHARTS

Line chart

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Bar charts

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A candlestick chart

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EXAMPLE ON TECHNICAL ANALYSIS

Date Open Price High Price Low Price Close Price

14-Aug-12 356 357.55 352.4 355.5

16-Aug-12 354.2 354.7 347 349.4

17-Aug-12 349.4 354.5 346.5 353.5

21-Aug-12 350.65 358.5 350.65 355.75

22-Aug-12 355 357.45 350.25 354.5

23-Aug-12 355.65 366.75 355.65 363.1

24-Aug-12 362.95 366.5 360.25 365.1

27-Aug-12 366.5 366.85 360.05 361.2528-Aug-12 360.5 365 359 363.65

29-Aug-12 364 369 361.5 364.15

30-Aug-12 364 370 362.1 369

31-Aug-12 369 372.5 360.55 362.6

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3-Sep-12 362.9 372.5 361.65 364.2

4-Sep-12 363 366 360.4 363.05

5-Sep-12 361 364 357.7 362.1

6-Sep-12 362.5 379 360.7 377.45

7-Sep-12 381.5 384.8 376.9 377.8

8-Sep-12 378.5 382.6 378.5 380.75

10-Sep-12 380 382.3 375 376.45

11-Sep-12 373.5 377 372.1 374.8512-Sep-12 377.25 386 375.3 384.55

13-Sep-12 387.1 389.35 385.5 387.9

14-Sep-12 395.95 395.95 387.55 391.55

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CONCLUSION

Helpful for the investor

Long term investments

Minimizes the risk

Maximizes the profits

Knowledge about the market conditions

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