About

Rajveer Rawlin received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher having followed capital markets in the US and India since 1993. His research interests includes areas of Capital Markets, Banking, Investment Analysis and Portfolio Management and has over 20 years of experience in the above areas covering the US and Indian Markets. He has several publications in the above areas. The views expressed here are his own and should not be construed as advice to buy or sell securities.

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Wednesday, 26 November 2014

Disconnect between the Rupee and the Indian Stock Market Indices

Yes falling commodity prices help narrow our current account deficit and are positive for the Indian market which is correcting lower from recent highs:
CNX NIFTY (^NSEI)

These developments are however even more positive for the Rupee taken together with positive foreign institutional flows, so why is the Rupee breaking down in the face of a surging stock market?
Global Dollar strength on fears of upcoming deflation?
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Here is some data to consider:
2008 GDP - 9.5%, Dollar/Rupee - 42, Stock market Peak January - 6350, P/E -24, 3 month return from Jan 08  < -30%
2015 GDP - 7.5%, Dollar/Rupee - 68, Stock market Peak in March - 9119, P/E -24, It remains to be seen how much of a decline will occur, as of now -20.0%.

Thursday, 20 November 2014

Vix is warning trouble ahead?

While the S&P is at new highs
S&P 500 (^GSPC)

The Vix is not making new lows, on the other hand it is threatening to break out significantly higher
VOLATILITY S&P 500 (^VIX)
 This suggests the upcoming market sell off will be far worse than the October pull back.

Wednesday, 12 November 2014

long bonds signalling onset of deflation?

30 yr long bond yields about to break below 3% in the U.S despite all the QE withdrawal talk confirming the onset of deflation. Chart courtesy yahoo finance.
Treasury Yield 30 Years (^TYX)

Monday, 10 November 2014

Deflationary Crash in 2015?

Thursday, 6 November 2014

QE forever wont stop deflation

QE in Japan, QE in Europe, QE in the US, there is no stopping deflation though.
Look no further than the recent strength in the dollar, break out in the US Volatility Vix index and an absolute collapse in several industrial commodities like crude oil, copper and silver.


Monday, 3 November 2014

Markets to get a reality check?

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My Asset Allocation Strategy (Indian Market)

Cash - 40%
Bonds - 20%
Fixed deposit - 20%
Gold - 5%
Stocks - 10% ( Majority of this in dividend funds)
Other Asset Classes - 5%

My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.