Price Shockers NSE & BSE, Stock Market Index Analysis
Price shockers NSE and BSE are nothing new. In fact, price shockers are a lot more
common on the BSE where small and mid cap stocks can even appreciate by up to 100%
in less than a month. Price shockers are all about stocks that show a sudden spurt
in price. We are not talking about a normal above-average or above-index returns.
What we are talking about is stocks that give some incredible level of returns in
a short span of time. As part of its stock market index analysis, LKP Securities
has a complete page for such price shockers. Here is how to approach price shockers…
Analysis of Price shockers at LKP Securities…
Price shockers at LKP Securities website are covered with two distinct filters in
mind. This gives you a wide leeway to select stocks based on your capitalization
and time period criteria…
- LKP offers the first filter of price shockers based on the stock
exchange. Obviously, the price shockers on the positive side are likely to be larger
in magnitude on the BSE considering that there are a larger number of companies
listed on the BSE. Typically, these price shockers are those that have managed to
hit a series of upper circuits as that is the only way companies traverse a very
vast distance in a short period of time.
- LKP offers the filter also on the basis of the holding period. In
fact, this is a short term trend indicator and hence LKP covers time frames like
3 days, 7 days and 15 days. This typically captures the short term trend quite effectively.
For example on the BSE your typical price shocker can give up to 90% in less than
15 days while some stocks even traverse returns of 40% in just 3 trading sessions.
Tracing the story behind the price shockers…
As a trader or an investor you know for sure that the momentum is in favour of such
stocks that turn out to be price shockers. Whether the trend is sustainable or whether
the trend is genuine is a judgement that you will have to make based on secondary
data affirmation and ratification. But these price shockers definitely provide you
with a starting point to identify such stocks of interest. You need to make some
adjustments before you delve into the story behind the stocks. For example, you
need to eliminate stocks that are moving up purely because the liquidity is cornered
by a handful of investors. Similarly, you need to avoid price shockers that have
given big returns on the back of thin volumes. These are not sustainable. Lastly,
you need to watch out for the circular trade syndrome. If you find the same set
of persons alternating as buyers and sellers in the bulk deals list, then these
stocks are best avoided. Price shockers, as the name suggests, is just a starting
point. You need to back it up with volumes data and fundamental add-ons before you
can actual convert that into a trading idea. But it is a good starting point, nevertheless.