iCharts Discussions

[opportunist]

See the attachment. Nifty daily seems to be running up a channel and will stabilise around 7000. This is when bulls will slowly come back and try to charter a new peak in the next 2-3 yrs.

But another simpler calculation is available:

On 17th March 2009 Nifty Spot close - 2757
On 18th March 2014 Nifty Spot - 6516

Gain in 5 seven years = 3759 points or 136%

That is if you invested 10K on nifty index fund on 13th March 2009 and did nothing you would have got 23.6K return

That would mean a growth rate of 6.4% p.a (compounding basis), also known as CAGR


So going by 6.4% p.a growth 6516 in March 2014 should have grown to 6933 on 17th March 2015. Instead it grew to 8723 that is it grew by 33.4% last year


So this unrealistic growth rate must be now normalised to prevailing rates of 6-7% p.a. The realistic level of nifty growing @ 6.4% p.a on mid September 2015 would be 6516*1.064^1.5 = 7155.

So 7100 is approximately the right level for Nifty now which it is finding slowly but surely.

Hope I made it clear

Regards,

Oppo

[pkholla]

Oppo: I hope you dont mind if I present another scenario! Modi's win has been termed as injection of N- ia$%a- M into the market and it has certainly spurred the market to an absurd (=not logically possible) high of around 9100. Like humans, NF is no superman, and "the next day morning hangover" correction will bring the market down to 7400? 7200? or 7100 as you have determined.
But what next: will funds withdrawing from China, again inject the vital "growth" tonic to take NF to 9200/ 9600/ 5 figures? Only time will tell!
Cheers, Prakash Holla

Observation: Having lived 40+ years in Bombay, I have observed that South West Monsoon rains continue in abundance at least till Ganesh. Which comes late this year, on Sept 17. Can good last minute rains save the day and narrow down the yawning deficit = uplifting news for NF? I think, yes!

[trendy]

Its 19% CAGR for 2009-14.

[opportunist]