The Satirical Guide to the Indian Stock Market

Wednesday, 07 May 2008 14:57

Written by Chest50Arms20

Stocks. Ask an investor. You cant live with them. You cant live without them. You can love them. You can hate them yet you cant ignore them. Especially if you happen to be an investor in the Indian Stock Market or "Shock" market.

I am a third generation Indian investor with a third generation talent in picking shares that make you lose your shirt (or maybe just give you enough to buy one).

In the most recent shirt losing experience, I attained Enlightenment while reading the 20% upper circuits and 20% lower circuits in a pink newspaper.

Maybe the paper was made from Bodhi Tree Pulp or maybe it was just a crack in the Matrix or maybe it was listening to Carnatic Music on an empty stomach.

It doesn't matter. In a flash that lasted less than a nano second, in a timeless serene ocean of peace, I was shown a wonderful reality about the Indian stock market in its totality.

Surprised? Shocked? Whats to be surprised? Science has proven that humans share DNA with animal species.

Infact Chimpanzees/Gorillas/Baboons and Humans have 98% similar DNA. The 2% mutation occurred when a Gorilla opened a banana ditch and gave 1 peel to 20 others, promising them 1 banana every day if they gave him one banana each that day. Two weeks later, a whistle blowing baboon discovered that the ditch was empty and in the resulting punch up, brain damage in the tribe led to mutation. A majority of the mutants descendants became investors. The enterprising gorilla descendants became the founder of Operators, brokers, promoters and politicians. The whistle blowing baboon didn't evolve too much. Its descendants became journalists.

Now, apart from the primate component in our DNA protein complexes, there is a personality component that derives from several animals. This may have actually inspired the Chinese calendar. I always knew that the Year of the Horse or Year of the Rabbit meant that in those years, a Horse or Rabbit personality would lose his life savings in the stock market.

Infact, Karate evolved as a means to punish the stock broking cartels who cleaned up the ming
or ping or ching dynasties. The investors had to sell all their weapons and so were left with bare hands to kill the bears.

On to the zoology lesson.
There are 10 primary animal personas, especially for Indian investors.

1. The Bull Investor:

The Bull Investor is very well known. The Press and Media never fail to praise the bull when it invests in an over valued stock, all the time convinced that it is undervalued.

The advantage of being a bull investor is that there is mostly a bigger bull who believes the other bulls bullshit and buys at even higher prices. This is also known as the "Greater Fool Theory". Logically, we can derive that all bulls are fools.

The last bull normally ends up in the McDonalds double decker burger.

2. The Bear Investor:
The Bear Investor is the master villain in our media. The evil Grizzly Bear brings down stocks because it thinks all stocks are over valued even if the stock earns ten times its par value every quarter.

Nobody understands the psychology of a bear investor. Some psychiatrists who belong to the mixture of Freudian, Jungian and Platonic school point out that inferiority complexes in childhood could lead to a Bear investor self identifying its low self esteem with all other objects of perceived value. I think Bears should attack such psychiatrists instead of the stock market.

In any case Bears also end up being skinned when a herd of mad bulls attack them. Just being a carnivore isnt a guarantee of success in Dalal Street.

3. The Fox:
The wily Fox. It rarely loses. It will speak bull language and eat grasss amongst bulls but sneak into the bear camp when the bigger/dumber bulls start leading the herd. It also gets tired of vegetarian meals after a while. Later on, it will ditch the bears the moment it spots a large herd of even bigger and dumber bulls. Ultimately it gets to eat the bulls and wear bear skin suits.

You may find some foxes in the options and futures market. They get busted only in times of sudden disasters. Its safe to say that this rare species is the most successful of Indian investors. The Indian Investor Wildlife Fund however has the Fox Investors in the extremely rare category.

4. The Rooster:
A Rooster investor cannot wait to day trade! It will rise early each day and rush to open three or four computer screens and scan the charts, crow about its discovery of stock price support and stock price resistance. It will bravely tell other chickens entry and exit points without its feathers getting ruffled by the Index values. 99% of the time, the market will behave in the exact opposite way and as a result, the poultry industry is always stuck with the problem of over supply. Good for Chicken Tikka fans.

5. The Lamb:
The most common Indian investor personality. Excellent epertise in being slaughtered day in and day out, week after week, quarter after quarter and year after year. They (We?) always manage to get in the wrong stock at the wrong time and get out of the right stock at the wrong time. Designed for destruction, you can never fail to identify them, especially in Internet message boards where they scream for help before their bankers drag them to the abattoirs. "Abattoir" is the Corporate Head Office of Butchers, for those who are rushing to get a dictionary.Here is a typical Lamb Message in an Internet Stock Forum:

"Dear Sir,
I bought 100 shares of Tobacco Chewing Software Ltd at 2150 rupees on recommendation from a leading analyst on XYZ Stock News Channel. The stock has since come down to 2 rupees. Should I buy 100 more to average ? Please tell me what to do!"

What can we answer! It is going to be slaughtered anyway so a Fox investor would ask the Lamb to average by buying 10,000 more.

6. The Horse:
The Horse Investors just want to run and run and run! They cannot stay with the same stock for more than 3 days, sometimes 3 hours. They are blessed with very poor mathematcial skills and this helps them avoid any guilt feelings of booking losses. A cyclical pattern emerges in their lives wherein they lose all their trading money in 2 weeks and get back to their stable, labouring to earn enough for next years loss.

Unaware, they carry a lot of Fox and Snake Investors on their backs….

7. Which brings us to the Snake Investor:
The deadliest possible investor. Even a Fox Investor may lose but a snake investor never loses because it has a forked tongue ie two professions: That of an Analyst or Operator or Company Promoter as well as that of an investor. It will always claim that it doesn't have any vested interests in the stocks that are the focus of its research.
[The Snake never lies to itself else it will bite its tail in disgust and commit suicide. All it will do is maintain two accounts, one for its wife or child to keep those stocks on which it manipulates consent in the general zoo of investors]

You will see snakes every day on a stock channel. They will call the right guest, another member of the brotherhood. The snake brothers would have picked up 100000 shares of ChoriLal PlasticButtons Ltd, talk about a textile boom which would boost the button market 10 times. (Why? because one shirt needs 10 buttons average, dummy) and after the show is over, dump their shares on a 20% upper circuit breaker. The company is likely to be delisted next week due to bogus accounting but the Snakes have made a killing without even having to use their poisonous fangs. The forked tongue is sufficient…Snake Investors also abound in the company of other animals. They will spur the horse to chase after the worst stock, lead lambs to the slaughter on the company ripe for the greatest fall and occasionally conduct special coaching camps for Foxes. Their mere look is enough to hypnotize a bull into action. Even Bears are not safe. Several Bears have been skinned when they short sold a stock in the morning just before a Snake releases news to lock it in 20% upper circuit freeze.

The most dangerous place for a Snake Investor to be is however an internet message board where many Lambs can visit 24 hrs from across the planet to choose the knife to get slaughtered with.Here is a sample conversation, brackets have my comments:

Snake_Investor: "Dear Friends, I have been told from the highest possible source (its maid or driver) that Khooni Knives and Razors Ltd ( Company premises are actually used to make tons of cobwebs) is coming out with a 10:1 bonus issue ie 10 shares bonus for every share held!!! Date of closure is only 30 days away, in their extraordinary general body meeting!!! Buy! Buy! Buy! Stock will triple"

[10 days later]
Lamb_Investor "Dear Sir, Thanks for the info. The share has climbed to 275 from 30. I want to buy 10,000 shares with my life savings. Is there still sufficient chances of growth?

Snake_Investor: "Dear, Stock will reach 1000+. Buy! Buy! Buy!

(suddenly, the hypnotized Bull barges in)
Bull_Investor: "I am buying! Just buy! buy! buy! "

[2 days later]
Lamb_Investor: " Bought 5000 shares as share is now 500. Thanks for the recommendation"

Next day the delisting news will come with fines slapped by the monitoring agencies. The promoters have long fled to Switzerland. Share has no buyers and eventually falls to 2 rupees.

[20 days later, in the slaughterhouse]

Lamb_Investor: "I should have bought at 275 levels itself…."

Bull_Investor : " If we escape the butcher, I have one more pick to help us recover.
Anti-Itching Software Solutions Ltd , Target 3000 , BUY BUY …Bye Bye (Chop)…."

8. The Hog Investor:
An easy classification. Hog Investors like to make pigs of themselves in Dalal Street. Instead of bringing home the bacon, they largely end up as sliced ham in a Bear restaurant. The Bears do feel like a bit of a swine when they cut up the Hogs but its all in a days work for them. After all, these greedy Hogs should know when to stop buying a certain stock. As you "Sow", so you reap.

Heres a typical encounter, the poetic license is pure Hogwash:

Hog_Investor: "Oink! Oink! Grunt! Grunt!, I need 1000 shares more you runt! "

Snake_Broker: "Against my tendency do evil and shine, I advise restraint and silently whine."

Hog_Investor: "Oink! Oink! I need 1000 more, loafer!"
"Any delay and I change my broker!"

Snake_Broker: "This hurts me more than I thought it will,"
"Got you a 1000 more Piggy, Have your fill."

[2 weeks and 20,000 shares later, the Hog loses his profits and is 90% in loss]

Hog_Investor: "Oink! Oink! How much credit do I have to start afresh?"

Shylock_Banker: "I don't know but I will be knocking for my pound of flesh."

(Actually it will need all 100 pounds of the Hog to pay for the losses, but you get the general
idea. )

9. The Vulture Investor:
Not a bad animal persona to have. Whenever a bubble bursts and millions of bulls, lambs, roosters , horses and hogs become mincemeat in the Snake /Bear owned slaughter houses, the vultures fly down to collect the scraps of stocks left behind after the carnage.

These are the times when Dalal Street is so morose that a graveyard starts resembling a Bay Watch episode in comparision. In some ways, vultures can be more succesful than Snakes and Foxes but have a habit of exiting the scene the moment a recovery takes place.

Afterwards they may mutate to other loser animal personas or stick to vulture hood patiently for a few months more.

10. The Elephant Investor:
This one is a must have guest in meeitngs and high soceity parties! Typically a high networth individual whose great grandfather was the Nawab of Nizamabad, you will see them in race courses with elegant women young enough to be their grand daughters.

The names of their suits and ties will have 30-40 letters and sound like a combination of an Italian dish , a newly discovered galaxy and a latin name of an animal species.

These Elephants have the proverbial computer hard disk memory and will recall the board of directors of a company that went bankrupt 67 years ago. (I wont be surprised if the Elephants father made a killing before the bankruptcy. Most Elephants have Snakes for advisors).

Elephants have the size advantage. Ok, I know that cliché wanted you to throw the monitor into my head but I mean it. They get all the juicy IPOs first and a huge allotment thereby allowing them to get bigger. And whatever good stocks are left, the Elephants can use the Trunk advantage to hose it up. They really need to gobble up 1000s of shares of 100s of companies in a typical investment year. Market collapses and bubbles just don't matter.

The Snake and the Fox use the infinite financial weight of the Elephant to ride the Horse for profits before arranging the slaughter of Lambs , Roosters, Bulls and Hogs.

This completes the top 10. You also have several other species behaviours in Investors but they are occasional. A 100 rupee profit will make the investor roar like a horny Lion. A Donkey persona will allow the investor to make an ass of himself while stubbornly catching a falling share. A Shark Investor will loan his profits to Lambs and shear their wool before the Bear makes chop suey. So on and so forth.The moral of this zoology lesson is to overcome your animal instincts and become a Human Investor. Learning from the mistakes of different personas and leveraging their strengths help improve your trade strategies to optimal levels over a lifetime. Maybe you will turn into an Elephant Investor with an FTV model by your side!

PART 2: RAVINGS OF THIS WHIRLING STOCKAHOLIC DERVISH

Not a single word of this Part of the articke could be true because it's a totally subjective viewpoint and there can be no evidence to the contrary. Enjoy! Just light reading to prepare you for the academic preaching in the end

Insane Thoughts of a Lunatic who has lots of free time…..

Why India should not outsource to Africa.

1. There are some parts of Central Africa where keyboards may be considered edible.

2. Our companies cannot afford the life insurance costs of outsourced Tutsi Africans.

3. Africans are yet to master the decimal system. Binary code will not be time effective.

4. A Sahara Desert BPO office will eat into the power costs. Dude, do you know how much electricity is needed to keep a central AC running when the external temperature is 60 degrees?

5. Forget power costs, they don't have too many generators installed yet.

6. In some areas, our BPO trainers wont get food, and may even end up on the menu.

7. Computer Virus isnt a worry but Ebola and HIV++ are a cause of concern.

Why India should not outsource to Bangladesh.

a. Traffic jams prevent more than 2 hours of work

b. Inefficiency is 90% of the 2 hrs work that gets done.

c. Cost of setting up undersea cables is prohibitive, especially due to monthly cyclones.

d. Sea Water damages hard disks.

e. Monitors that have pictures of women could be attacked with acid.

Why India should not outsource to Pakistan.

a. Bandwidth will be eaten up 100% in downloading Porn.

b. Difficult to employ women where bandwidth is eaten up in Porn.

c. Thick Burqas can affect the audio quality of headphones, in the all women call centres.

d. Mikes will get clogged due to excess makeup.

e. Do you seriously think a Paki can solve a technical problem on the phone?

[A Pakistani happily chats in a Delhi Call centre. A Sardar asks him, "Oye, Who employed you here? Paki says ," Paaji, I came to make an ISD call to my second wife and when I was about to call, some Firangi called me instead and said his Windows were not closing. I asked him to kick from outside and after sometime he said everything worked fine and thanked me. Within a minute a team of men in black suits started congratulating me and gave me 10,000 rupees to call as much as I can…Truly India is Shining!!!" ]

7 Great Future Products and Companies of India:

1. Maalaamaal Baal Cream:

An "instant hair regrowth" company, will target the future generation of metrosexual men who got bald early due to using too much of hair spray, gel and "All Cleared" Shampoo. Secret Ayurvedic techniques will be used, including plucking of herbs in new moon nights and mixing them in full moon nights. With 100 million middle aged men as customers, the company can easily earn net profit of 100 crores per quarter.

Downside Risk: The product is too good. Accidental drops falling on eyes/forehead/teeth can cause tremendous hair growth in these areas. Men who use the cream and scratch itchy areas are in for a surprise. Divorces can increase as Indian women do not like being touched with bushy palms. Nor do they like hair on their cheeks from a loving caress of a husband who has just applied Maalaamaal on his bald head.

Contrarian Company to invest: Hajaamat Anti-Hair Spray Ltd.

2. "All Night Long" Male Contraceptive Pill Set

Invented by a consortium that includes Fizzer, RanBackC, BioConk, Pantacea Biotech, Nicholas Prickamal, Abbort , Sunk Pharma, AuroBhindi Pharma, Dr-is-Ready Labs and NutCo Pharma. A product that uses ViaGharA mixed with a new molecule called BachchaRocho Nightroxide. Automatically enahnces vigour yet prevents accidental conceptions. Next version in the pipeline will have an auto-disinfect feature too to rid the world of the fear of AIDS.

(And then I can finally test the product in Thailand, Phillipines, Argentina, France and Mexico.)

The popular TV ad goes like this:
" Morfoolus: Neo, You choose the green pill, your wife will get pregnant and you will have all the worries of a married man with wailing kids, changing diapers and college fees. You choose the red pill, you can stop your worries and get on with what we are made for.
Neo: Stop your philosophy and give me the freakin red pill!!!!!"

Easily will be the best selling drug in world history. And since all pharma companies have made this as a consortium, you can buy pharma mutual fund bonds the moment the news of this drug is out. Assured 10,00,000% returns.

Downside Risk: Will increase the family size hundred fold of all colour blind men. Law Suits for not making a black and white pill can run into 500,000 crores.

3. C-FAR, a remote controlled contact lens product from InfraLens Ltd.

Millions and millions of Indians want to wear Raid Bank Sun glasses but cannot due to short sightedness and suffer from severe inferiority complex. This product uses the latest Satellite technology to track a user wherever he is and send a constant beam of infra red correction lens just ahead of his eyes. Thus, he never has to wear prescription glasses or contact lens.

A dual advantage is that the same satellite beam can be used to access internet, see cricket scores, adult MPEGs and complete online secure transactions with 256 bit Encryption.

Cheap, easy to use and broadly accepted, the earnings of the company can easily surpass those of Infosys in the late 2000 AD.

Extra Tip: Shares of Raid Bank Sunglasses can also be purchased on the side.

Downside Risk: A slight mistake in the positioning system can permanently blow a hole in the skull.

Investors can book profits when they hear the news of the first fatality.

4. Fidayeen Magnetic Radar from Fidayeen Security Services

This is a fantastic product from a fantastic company! The success of the Indian economy will prompt thousands of extra Fidayeen to attack our companies. The best way to utilize this free human resource is to use the enemy against the enemy. Enter Fidayeen Secuirty Services Ltd.

FSS makes a radar called FMR. This not only detects a Fidayeen but automatically brainwashes him into thinking that any other Fidayeen he knows are Indians and all Indians are fellow Fidayeen. Pretty soon, you will see hundreds of Fidayeen colliding with each other and blowing themselves apart.

The company will earn from sales of the radar as well as Insurance Costs saved in the premise. The invesntors are from IIT Madras and so have included a module that calculates how many insured Indians would have died if the FSS Radar was not installed, and they use this to charge 10% of LIC average payout person [which in most cases is zero but FSS don't know that yet…]

In any case, earnings will grow with growth in the economy but will fall once all Fidayeen blow themselves up, which would take 200 years considering the population explosion in Afghanistan and North West Frontier Province.

Till then, happy investing!!!

Downside Risk: Fidayeen colliding and blowing apart in a crowded Railway Station is not a very pretty thought….this could lead to lawsuits.

5. Veer Appam Treasure Hunting Services Ltd.

Can there be a better company? With a low equity of 1 crore, this company has hired 20,000 jobless villagers from Andhera Pradesh to hunt for hidden treasure of dead Veerapan. So far they have recovered 60,000 tons of sandalwood, 25,000 tons of rosewood, 200 crores cash, 2000 ivory tusks and Nakkeeran Gopals moustache.

Another 5000 crores of cash is reportedly to be found. Considering that the hunting farmers are from Andhera Pardesh and might habitually commit suicide, the salary savings are immense. Thus, the overall EPS will be 10,000+ ;

Safe Investment for long term.

6. Benam Bottlewala Astro Index Services Ltd

The new India will not be ashamed of its past. This tendency has been captured well in Benam Bottlewala Astro Index Services. The company has hired over 10,000 jobless astrologers and they sit in a call centre to give consent to day traders whether Saturn and Venus and Rahu favor a short or long position on the NIFTY future. Demand is very very high and every successful consent automatically brings 10% into the company account. Every failure deducts 5% from the company as compensation. A very smart IIT Maths major has written the contracts for the company.

Benam Bottlewala himself expertly uses the charts to decide if he can go short or long with the winnings.

50-50 chance of tripling your investment in one day. Investors with appetite for risk can consult these astrologers online and invest daily.

7. MMS SCANNER from Skinvestigators Ltd.

The bold Indian youth has started discovering the biological processes in the early teens itself, especially children of affluent parents in Public Schools. New gadgets will allow new postures to be recorded and formatted faster in smaller MMS formats. The spreading of this live smutty entertainment can cause millions of deaths of middle aged men especially if they see the MMS while driving their two wheelers on a highway.

Enter MMS Scanner, a great product from Skinvestigators Ltd.

This tool uses the Insat 10X Satellite to monitor every MMS clip that is sent from the cellular networks. The algorithm is able to detect school girl skin in 5 nano seconds using Fast Fourier Transforms and immediately uses DIrect 4D Graphics to replace it with green, bubbled, toad skin. The school girl face is replaced with a face of Adolph Hitler. This has the side effect of causing severe nausea to the viewers and psychiatric illnesses later on but the Indian Tradition of Modesty is upheld.

The EPS of the company has been booming due to a lot of Other Income. Great buy!
[Apparently they sell the actual clips on hard core porn sites and make a killing…]

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