Nifty Futures in Deep Discount of 25-30 points ?

As i have always mentioned before i am not a great believer of OI data and other statistics as it changes every second and could be very deceptive rather then informative.

In the last few sessions people consistently ask me that why Nifty futures is in deep discount. Reason being that i have been giving a Buy call on Nifty futures at 4800-4850 which we finally booked out fully at 5060-5080 June and would now watch for fresh trades.

Although discounts and premiums might give a direction signal but i dont consider them for my analysis. For now the current discount of 25-30 points is normal for Nifty in the months of May and June because of the dividend payouts by large cap stocks.

Some of the current dividend payouts are by SBI,ITC,HDFC Bank,ICICI Bank,IDFC.

For the basics  about Derivatives – Contract holders are not entitled to dividends.

So with so many payouts in coming days there is bound to be an impact of 10 points just because of the dividends.

For example ITC dividend is 10 Rs.Weightage on Nifty is 3.4%. So when ITC goes down by 10 rs on ex dividend date it impact Nifty by a small fraction but thats what accumulates to 10-15 points of the current discount on Nifty.

This is very simple to gauge that the current discount is seasonal in nature and happens every May/June because of dividend payouts.Still i have seen many analysts saying this to be short rollovers/built up of short positions etc but hardly any mention of the actual impact of dividends on current discount.

So are the analysts looking into real statistics? Or are this dynamic statistics that useful.

I dont know the answers but i stick to my core technical analysis which said Nifty was a buy at 4800-4850 for a minimum of 200-250 points gain which all our readers must have got.

Ever since we have announced the 50% discount for one of our sessions Kazim ( business head –training) has been on phone:) So with the good response we have decided to extend the discount for the next two sessions scheduled in Mumbai. Come be independent. Last date to register is June 2.

Also we might have a special exclusive refresher session for ex-students and much more exciting NEW developments.


now at a huge discount

For more details download the pdf for details.

1 Comment

  1. Akshay
    June 1, 2010

    This is what a complete Analyst is …. Rest of them just come and speak blah blah blah.

    Nooresh Rocks


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