Real Time Data

What is Real Time Data?

• Before going into MCX Real Time Data, we have to understand the term Real Time Data. By Real Time Data, we mean the truly accurate, live and timely data of the stock market( Equity, Commodity, Currency, Options) movements that are fed in different charting platforms like Ami broker, Metastock, Metatrader etc. Real time data for stock charts is extremely essential for Share Market Traders, Brokers and Analysts. 

Types of Real Time Data

In India there are mainly five types of real time data to trade on.

• NSE real time data: This data is delivered by National Stock Exchange of India. It is perhaps the most popular equity live data in India. It comprises of Equity Cash data, Equity Futures and Options data. Nifty data is very important in this segment. It is the benchmark index whose trend depicts the overall share market trend in India.
   
• MCX real time data: This data is delivered by Multi Commodity Exchange of India. It is considered as the most popular commodity live data in India. It comprises of many Commodities like agricultural, precious metals, energy and currencies. Presently MCX Currencies data is gaining huge popularity among traders and brokers.
   
• NCDEX real time data: This data is delivered by National Commodities and Derivatives Exchange of India. It is popular for trading the agricultural commodities of India and hence, agricultural commodities are its uniqueness. 
   
• BSE real time data: This stock exchange stands for Stock Exchange of Mumbai. The term "Dalal Street" is closely related to this stock exchange. It is very important because it is the oldest stock exchange of India. You all are familiar with "Sensex" right? Yes, Sensex is the benchmark index of BSE. This data is delivered by BSE.
   
  Most popular time intervals for Real Time Data - 
   
  • For Intraday trading (also called Daily trading), one should use 5 minutes interval. This time interval is time tested and statistically most successful for Day traders. Below 5 minutes interval, the chart becomes over-jittery and creates very short swings which are harmful for day traders. So the rule of thumb is "stick with 5 minutes interval" during day trading.

  
  

  
  

  • For short term trading (i.e. done for few days), one should follow 15 minutes time interval in charts. Because it smooths the chart and gives opportunity to enter into long swings. This gives more profit over short term. One question may arise in your mind that then why not use 30 minutes? Yes, you may use 30 minutes but statistically 15 minutes time frame has proved itself most successful for short term trading perspectives.

   

 

Key Factors to judge the quality of Real Time Data - 

Truly "real time data feed" - Quality of Real Time Data matters the most and is the primary when it comes to perform Technical Analysis. Data should be absolutely Real Time Data with negligible delay period to do the accurate Analysis. Choose companies that provides live demonstrations so that you can judge the quality of the Real Time Data.

How to choose the right Real Time Data

Price- Price is also a significant factor determining which Real Time Data Provider to choose. But price should act as secondary factor after judging the Quality of Real time Data. Most companies nowadays are offering almost similar prices of their products delivering Real Time Data. So, price remains competitive in today's market. 

After sales service. Many traders think that cheap rate means bad support. So traders should choose Service Providers that offer Prompt and Quality Technical Support Service. Companies like Rtdsdata.com has dedicated live chat support for 24 hours for any assistance thus making them even more popular among numerous Service Providers. 

Software Simplicity- Traders should make sure that products that are being offered are simple, extremely user friendly, robust and also have good compatibility in even slow speed Internet. Choose a Service Provider that offers customer friendly products. 

Problem solving and data recoverability-  It is a very vital factor that should never be ignored. Besides all the customer friendly features that one has to look for, traders should also mind the fact that those software's should have good problem solving capability as well as Data Recoverability feature so that data is not lost in account of any technical issues. Back filling of Data and Recovery of lost data is very crucial for Stock Market Data. 

Automatic Simultaneous Updations- Stock Traders and analysts are very busy during trading hours. It is very tough for them to separately select and update scripts. Software's should automatically and simultaneously perform live Updations of Back filling and Real Time Data so that time is not lost.

Long-run stability and service-  Many data providers emerge in market suddenly with sophisticated website to attract traders and general customers. Hence, they lack in quality and service and just vanish from the market all of a sudden. Traders and Customers needs to be aware of these unscrupulous Companies! 


Thank You !

How Stock Prices are set?

Stock prices are a function of supply and demand. Other influences such as earnings, the economy and so on may affect the desirability of owning (or selling) a stock.
If a company reports surprisingly low earnings, demand for the stock may wither. As it does, the balance between buyers and sellers is changed.
Buyers will demand a discount off the existing price and many motivated sellers will accommodate. More sellers than buyers means there is more supply than demand, so the price falls. 

Prices Drop

• At some point, the price drops to a level buyers find it attractive or some other factor changes the dynamic. As buyers move into the market, demand grows faster than supply and the price goes up.

• Some times supply and demand find a balance, which is a price that buyers accept and sellers accommodate. When supply and demand are roughly equal, prices will bounce up and down, but in a narrow price range.It is possible for a stock to stay in this range for days or months, before something else disrupts the supply/demand balance.

• There is a delicate inter-relation ship with supply and demand and a stock’s price. If demand for a stock exceeds the supply, its price will rise. However, it will only rise to point where buyers suspect demand is waning. At that point, holders of the stock will sell. Some may have ridden the price up and believe a reversal is coming so they take their profits and sell.

• As more owners sell (for whatever reason), the price begins to fall, since there is now more supply than demand. To entice a buyer, the holder of the stock lowers the price. The same dynamic works on the other side, but in reverse. As the price falls, it will reach a level that buyers find attractive. As buyers acquire shares, the stock’s price rises since sellers must be enticed to let go of their shares.

• This dynamic of supply and demand is the most important truth investors need to learn about stock prices. While investors may want to assign a value to a stock, it is the market and the give and take between supply and demand that sets the price. 

Every day is a new day.

Every day the market opens, it’s a clean slate. Investors must meet no set prices. Stocks that the day before were flying high may not get off the ground today. The ugly duckling turns into a cash cow (how’s that for mixing metaphors). The point is a share of stock is worth what someone else is willing to pay for it. That is the heart of investing. 

Fair Price 

Successful investors decide what a fair price for a particular stock is and that’s where they buy. They don’t let market hysteria goad them into overpaying. Likewise, if nothing has fundamentally changed with the company, but the stock is dropping along with the market, successful investors will sit tight and not be frightened off a good price. As you develop you investing skills, you will learn strategies and techniques to help you establish a fair price for stocks and either get that price or find another stock to buy that meets you investing criteria.

Ways of Stock Market Trading

What are the ways of Stock Trading?

There are so many ways in which you can do stock market trading. Here we are presenting some of the most common form of stock market trading including trading in equity segment, margin trading and derivative trading along with the advantage and disadvantage of each type of trading. This will help you find the right way of doing trading at the stock market depending on your fund and your objective of stock market investment.

Equity Segment – 

• This is the most common form of trading stocks. In equity segment you buy the stocks of the companies through your broker. Once the request fro buying the stocks is settled and payment is made the stocks are deposited to the DP account of the investor. Then stocks can be hold or subsequently sold by the investor. 

• The advantage of the equity trading is that there is no time frame for selling the stocks or closing the deal. You can always hold the stocks till you want and then sell it when you think is the right time. But the brokerage charge for equity segment is greater than the derivative segment or margin trading. If you are looking for good returns and do not want to take more risk and if you are ready to hold the stocks for longer period of time, this is the best way for you to invest in the stock market.

Margin Trading – 

• In margin trading that is also commonly known as day trading you have to close the deal by the stipulated time that is generally within the very day of the trading. The biggest advantage of margin trading is that you need not invest the full value of the stocks that you trade in. 

• Though the amount for buying the stocks is determined on the volatility of the stocks, in most cases you need to invest or have 5% to 10% of the total value of the stocks. So while doing margin trading you can hold more stocks with the fund than you could have otherwise bought them at the equity segment in delivery based trading. 

• Another advantage of margin trading is that you can short selling of the stocks. That means you can gain by selling the stocks at higher price and then buying them on the same day at a lower rate. The brokerage of the margin trading is also lower than delivery based trading. 

Derivative Segment – 

• Derivative trading can be done in four different ways - Future, Forward, Options and Swaps. In derivative you actually buy a contract that expires within a stipulated time frame. 

• Usually all the derivative contracts in a specific stock market expires on a particular day of every month. You have to close the deal either by selling or buying the stocks within that stipulated time. 

• In derivative trading the stocks are bought and sold in lot. The number of stocks in a lot varies from one stock to the other and the price of the lot is derived by multiplying the number of the stock with the current price of that stock in that market. 

• The biggest advantage of derivative trading is that you can get the lot by investing only the 30 to 40% of the actual price of the stocks that you will be holding. Moreover, you can gain by short selling the stocks as well that means you can first sell the stocks at higher price and then make profit by getting the stocks at lower price. The brokerage for derivative trading is generally lower than the cash segment if you consider the amount of investment and the number of stocks you hold.

These are the most common ways of doing stock market investment. All said and done you have to choose the way you invest in the stocks. Remember it is not the process but the ability of selecting the right stocks will be the determining factor for making profit from stock investment.

Stock Market Trading

What is Stock Market Trading?

Trade = Buy or Sell

To “trade” means to buy and sell in the jargon of the financial markets. How a system that can accommodate one billion shares trading in a single day works is a mystery to most people. No doubt, our financial markets are marvels of technological efficiency.

You don’t need to know all of the technical details of how you buy and sell stocks, however it is important to have a basic understanding of how the markets work.

Two Basic Methods

There are two basic ways exchanges execute a trade:

• On the exchange/Trading floor

• Electronically

There is a strong push to move more trading to the networks and off the trading floors, however this push is meeting with some resistance. Most markets, most notably the NSE, trade stocks electronically. The futures’ markets trade in person on the floor of several exchanges, but that’s a different topic.

Exchange floor

Trading on the floor of the National Stock Exchange (NSE) is the image most people have thanks to television and the movies of how the market works. When the market is open, you see hundreds of people rushing about shouting and gesturing to one another, talking on phones, watching monitors, and entering data into terminals. It could not look any more chaotic.

Yet, at the end of the day, the markets workout all the trades and get ready for the next day. Here is a step-by-step walk through the execution of a simple trade on the NSE.

• You tell your broker to buy 100 shares of Reliance Industries at market.

• Your broker’s order department sends the order to their floor clerk on the exchange.

• The floor clerk alerts one of the firm’s floor traders who finds another floor trader willing to sell 100 shares of Reliance Industries. This is easier than is sounds, because the floor trader knows which floor traders make markets in particular stocks.

• The two agree on a price and complete the deal. The notification process goes back up the line and your broker calls you back with the final price. The process may take a few minutes or longer depending on the stock and the market. A few days later, you will receive the confirmation notice in the mail.

Of course, this example was a simple trade, complex trades and large blocks of stocks involve considerable more detail.

Electronically

The process of conducting stock market transactions (buy and sell orders) using an electronic platform that transfers the orders to a physical person to complete. Electronic trading has become a popular method due to its ability to conducts transactions quickly and effectively.

In this fast moving world, some are wondering how long a human-based system like the NYSE can continue to provide the level of service necessary. 

The electronic markets use vast computer networks to match buyers and sellers, rather than human brokers. Many large institutional traders, such as pension funds, mutual funds, and so forth, prefer this method of trading.

For the individual investor, you frequently can get almost instant confirmations on your trades, if that is important to you. It also facilitates further control of online investing by putting you one step closer to the market.

You still need a broker to handle your trades – individuals don’t have access to the electronic markets. Your broker accesses the exchange network and the system finds a buyer or seller depending on your order.