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Tuesday, 18 April 2017
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My Qs is. Pls give us the meaning of following terms:-
ReplyDeleteRSI
CCI
WILLIAM %R
MFI
ROC
SD
2nd. How can we see a chart in layman's terms.
RSI - Relative Strength Index
ReplyDeleteIt is a momentum indicator developed by Welles Wilder.It is leading indicator and is widely used by everyone from novice to expirienced traders. It is used to identify overbought and oversold conditions. It has a scale of 100 and the default time period is 14 days. RSI > 70 indicates overbought zone and RSI < 30 indicates oversold zone. Many experienced traders also consider RSI > 50 as overbought. RSI compares the value of gains,losses and price movement of a stock over a period of time. It is calculated by the formula 100-[100/( 1- Avg. Gain/loss during up/down periods in specified timeframe)
CCI - Commodity Channel Index
It is a momentum oscillator. It is also used to identify overbought and oversold zones. It is done by comparing the CAMP with the moving averages. It is also used to identify trend reversals.
Williams %R - Williams Percentage Range
As the name suggests, this Indicator was developed by Larry Williams. It compares the close of the stock to the high and low over a period of time. The default time period is 14 days. It is also used to identify overbought and oversold zones. It is also used to identify reversal in trends. It is very popularly used to time market reversals in advance. It is a leading indicator.
MFI - Money Flow Indicator
It is a momentum indicator. It measures the flow of money into and out of the security. It is calculated by comparing the price and volume. It is also used to identify overbought and oversold zones. MFI above 80 is overbought and MFI lower than 20 signifies oversold region. The default time period is 14 days. It is also known as volume weighted RSI.
ROC -Rate of Change
It is a momentum indicator that measures strength of price by the rate of change. It measures the percentage of change in price between the current price and the previous price.
SD - I don't get you! Can you please abbreviate?
2) A chart can be considered as a graphical representation of the market behaviour, human psychology and the fight between bulls and bears. Each chart is more than just candles, the charts portray emotions and drama in the markets.
My question:
How is the valuation for a company is done? Please explain in detail.
A valuation of a company is done with different process.
Delete1. Book Value. Which we derive by totalling the difference between all assets and liabilities. Balance Sheet Methord..
2. Market Value wise. Price of share * no of shares available.
3. Revenue wise. The amount of revenue a company is generating or it will in a certain period of time.
4. There are several other methods such as return on capital employed, profit percentage, dividend paying ratios etc.
There is one more method through which valuation can be done
DeleteValuation of a business by discounting its cash flows
The discounting method works a bit differently: first, you project the business income stream over some future period of time, usually measured in years. Next, you determine the discount rate which reflects the risk of getting this income on time.