Dhyanchand of Hockey….the Bradman to Cricket, Pele to Football

Major Dhyan ‘Chand’ Singh
August 29, 1905 – December 3, 1979
Widely regarded as the greatest hockey player of all time!
Dhyan Chand is to hockey what Bradman is to cricket, Mohammed Ali to boxing and Pele to football!
Legendary center-forward!
Won 3 Olympic gold medals
Scored more than 400 goals during his international career.
Awarded Padma Bhushan in 1956.
Born in Prayag, Allahabad in Uttar Pradesh.
His father Sameshwar Dutt Singh was in the Indian Army and played hockey in the army.
Had to terminate his education after class six due to frequesnt transfers of father.
Young Dhyan had no serious inclination towards sports, though he loved wrestling.
He did not play any hockey worth mentioning before he joined the Army.
He occasionally indulged in casual games in Jhansi with his friends.
Chand joined the Indian Army at the age of 16, in 1922 .
Subedar-Major Bale Tiwari noticed his dribbling skills. He became his mentor and laid the foundations of his game.
Between 1922 and 1926, Chand exclusively played the army hockey tournaments and the regimental games.
Chand was ultimately selected for the Indian Army team which was to tour New Zealand.
The team won 18 matches, drew 2 and lost only 1, receiving praises from all spectators. Returning to India, Chand was immediately promoted to Lance Naik.
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Once while playing a hockey game Major dhyan chand was not able to strike ball into the goal post of the opposition’s team. After several misses he argued with the match referee regarding the measurement of the goal post and amazingly it was found incorrect!
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Final of the Punjab Indian Infantry tournament in Jhelum.
The UP team was leading by three goals to one.
Only 4 minutes to go.
Dhyan chand responded with three goals in four minutes to lead his team to victory.
He seemed to be able to pass opponent after opponent at will.
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At the Berlin Olympics in 1936, Dhyan Chand could not play for finals against Germany, as he was hurt.
At half point, when India led by only 1-0 Dhyan Chand removed his shoes and entered the field bare foot.
He took India to a stunning victory scoring 6 more goals. Adolf Hitler left midway as he couldn’t bear to see his “racially superior” team being demolished.
Later the German dictator offered to elevate ‘Lance Naik’ Dhyan to the rank of a Colonel if he migrated to Germany. Of course, Dhyan Chand refused.
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In Holland, the authorities broke his hockey stick to check if there was a magnet inside.
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After India played its first match in the 1936 Olympics, Dhyan Chand’s magical stickwork drew crowds from other venues to the hockey field.
A German newspaper carried a banner headline: ‘The Olympic complex now has a magic show too.’ The next day, there were posters all over Berlin: ‘Visit the hockey stadium to watch the Indian magician Dhyan Chand in action.
‘After every India match, hundreds of spectators would troop down to the players enclosure and touch Dhyan Chand’s hockey stick to see what trick it was that kept the ball from leaving his stick as he dribbled his way all over the field.
One journalist reported: ‘It looks like he has some invisible magnet stuck to his hockey stick so that the ball does not leave it at all.’
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So great was the magic of Dhyan Chand that the Tokyo Olypics officials broke his hockey stick to search for a magnet inside. Embarrased on finding nothing, they consoled with the theory of a glue.
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On one occasion, a lady from the audience asked Dhyan Chand to play with her walking stick instead. He scored goals even with them!
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Don Bradman and Dhyan Chand once came face to face at Adelaide in 1935, when the Indian hockey team was in Australia. After watching Dhyan Chand in action, Don Bradman remarked “He scores goals like runs in cricket”
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An artist in Vienna depicted him as having eight arms.
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Once during a tour of Lyon in 1963, a female fan planted a kiss on Dhyan Chand despite him trying his best to avoid that.
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When everbody else thought he was going to shoot, he passed, to induce surprise.
And when he passed to you, you did not want to miss.
On that 1947 tour, he put through a wondorous ball to KD Singh Babu, then turned his back and walked away.
When Babu later asked the reason for this odd behaviour, he was told, “If you could not get a goal from that you did not deserve to be on my team.”
Keshav Dutt, Olympic gold Medallist, said “His real talent lay above his shoulders.
His was easily the hockey brain of the century. He could see a field the way a chess player sees the board. He knew where his teammates were, and more importantly where his opponents were – without looking. It was almost psychic.
He treated everybody as pieces on a board meant for his use. He’d know from his own movement how the defense was forming, and where the gaps were. In other words, he was the only imponderable, Everbody else (opposition included) fell in predictable patterns around him.”
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Residents of Vienna, Austria honoured him by setting up a statue of him with four hands and four sticks, depicting his control and mastery over the ball.
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Dhyan Chand owned a licensed army gun which he would use for hunting (which was not banned in those days).
He also loved to fish.
Cooking was his other favourite hobby. He was a non-vegetarian and enjoyed making mutton and fish dishes. He liked making halwa dripping with ghee.
His indoor pastime was billiards. After retirement in Jhansi, he used to play billiards till late in the night.
Dhyan Chand also played cricket well, and was good at batting due to his strong wrists. He used to play carroms and loved photography.
He admitted that he was not a good social mixer. While at home or during play, he kept to himself. He thought that it would be better if he kept quiet and just did his duty or job.
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In 1956, at the age of 51, he retired from the army with the rank of Major.
After he retired he coached for a while, then settled in his beloved Jhansi.
The last days of Dhyan Chand were not very happy, as he was short of money and was badly ignored by the nation. Once he went to a tournament in Ahmedabad and they turned him away not knowing who he was.
He developed liver cancer, and was sent to a general ward at the AIIMS, New Delhi. He died on the 3rd of December 1979 penniless and uncared for in a hospital, receiving a meagre pension..
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His birthday is celebrated every year as National Sports Day. The Indian Postal Service issued a postage stamp in his memory, and the Dhyan Chand National Stadium at New Delhi has been named after him.
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“Goal” is the autobiography of Hockey wizard Dhyan Chand published by Sport & Pastime, Chennai, 1952

Crude update

Tamay G Purohit says…

Buy crude.

Short HPCL, BPCL, ONGC, IOC, GAIL & OIL

FIIs will keep our stock markets up…

Here’s why..
The FIIs stand to gain much more than us Indians.
Here is why?
The rupee rate is 48 rupees to 1 USD. Assume, we buy Nifty BEES (Benchmark ETF) at 480. This means Nifty is at 4800. We get to buy 100 units of Nifty ETF with 1000 dollars.
ow a couple of months have passed by and Nifty reached 5350. Our ETF rate has gone to 530. The Indians earn 10.41 pc rate of return. Now our friend Mr Bernanke continues with his low interest rate regime, interest rate of almost 0 pc, he prints some more dollars, gold rallies and USD weakens. Now 1 USD gives us 44 rupees. We decide to encash our Nifty BEEs 100 units. We get back Rs 53000 = 53500/44 = 1215 dollars. A return of almost 21.5 % and the game goes on.
If the rupee strengthens to 42, we make even more returns. Now, FIIs are always leveraged that is they for every 100 dollars they invest, they can buy up to 300 dollars worth of stocks. They can make triple the profit. At the opportune time, they sneak away and the game begins in some other emerging market.
This is the secret of the so called FII flows.Of course, one can go with the trend and aim to move away before the music stops playing.

ULIP or NO ULIP (By Deepak Shenoy)

The turf war between the Insurance Regulator (IRDA) and the Securities Regulator (SEBI) is finally over. The government, on June 19th, passed an ordinance that granted full regulatory control of the Unit Linked Insurance Product (ULIP) market to IRDA, foxing many financial commentators. To an outsider, the brouhaha seems strange, but there’s a history to it. (Isn’t there always?)

Insurance has meant that you pay a certain amount of money so that if there is damage or a demise, there is a cash payout to compensate. If nothing happens, you lose the ‘premium’ paid.

In India, life insurance, in particular, has seen a different twist. People are sold products that return money even if they survive. So you pay Rs. 100,000 per year for 20 years, and you can get Rs. 50 lakhs back if you survive, and should you die, you have ‘insurance’ of 5 lakhs during this period. A part of your premium goes to cover the ‘risk’ of the 5 lakhs of insurance. Another part goes to cover fees and charges. What is left goes into an investment fund that will be invested and will grow over time.

Such products mix investment and insurance, and traditional ‘endowment’ products have been opaque offerings. An insurance company would only take the premium from you, and not tell you how much of that was fees or risk premium or investments-they would announce a ‘bonus’ every year, which would range from 4% to 9%, and you knew that was how much your total premium had grown that year.

Unit Linked Endowment products came in, promising more transparency, segregating and revealing costs, insurance and investment pieces. Additionally, you could choose the broad categories in which your money was invested-from risky avenues like stock markets, to very safe avenues.

This should have been good, compared to the traditional endowment market. But not the way it was implemented. ULIPs started confusing customers with complex products, where the costs weren’t obvious. For example, some brochures mention ‘Premium Allocation Charges’ of 30% – meaning, they charge you 30% of your premium as this particular charge, and after taking out all other charges, the remaining is invested. Another product would mention a ‘Premium Allocation Rate’ of 30% – meaning only 30% of your premium was invested. And sometimes they would move the costs into a Policy Administration Charge, as the IRDA, the insurance regulator, looked the other way.

Other strange charges were surrender charges-after charging you through the roof for the act of investing, insurers decided it was correct to penalize you for an attempt to take your money back-charges range from 5% to 100% in the first five years. The standard reply: ULIPs are long-term products, and this is the way we make them so. Yet, they charge the highest in the first few years of a policy and reduce the charges later-meaning, they’re not thinking longer term themselves; if they were, they would spread the charges evenly over the entire term. And the practice defeats the compounding concept: your first investments make the maximum rupee gains in the long term, but when they extract the maximum flesh from the initial premiums, your eventual gains are crippled.

The muddled and high cost structure negated any transparency benefits. It didn’t matter that some of these quirks were unearthed by financial journalists. Indeed, if you search for ULIP-related articles, nearly every single mainstream financial publication has carried articles against such practices; yet, people continued to buy them, even those with continuous access to the internet.

The reason: agents, who got a good chunk of those high initial charges as commissions, chose to highlight products as god-like offerings tailor-made just for those people who didn’t have time to decode a complex brochure or, seemingly, search the internet. They would lie, oversell, under-insure, or generally ignore their fiduciary duty as ‘advisors’. Again, IRDA chose not to cap the incentive commissions that promoted such behavior, arguing that any cap would hurt the industry.

In comparison, mutual funds have been much better products to invest in. With their regulator, SEBI, actively clamping down on mis-selling, charges have been reduced to just one-the ‘fund management charge, capped at 2.5% per year. There is no entry load, and any advisory fees must be paid directly to the advisor, not embedded in the products. SEBI’s actions made mutual fund agents poorer-the milking through entry loads was no longer possible-so agents moved substantial amounts of assets from the mutual-fund industry to higher -commission-paying ULIPs.

As a response, SEBI unearthed a technicality: since most ULIPs have a negligible insurance component, they are really collective investment products, which SEBI has the right to regulate. IRDA, noting that nearly 50% of the insurance business was ULIPs , decided to fight it out.

The rules were ambiguous, so the government had to take a stand. Admitting to SEBI oversight would unearth an uncompetitive product that gathered investment of nearly 1% of GDP, and perhaps even hurt investors in the short term as the concept was overhauled. IRDA would be embarrassingly compromised as a regulator. Insurers who made money milking investors would see immediate cash-flow problems. In hindsight, SEBI didn’t have too much of a case; there are many products that qualify under SEBI’s criteria of collective investment, but aren’t regulated by SEBI. Plus, the main issue was the mis-selling, which most commentators thought the IRDA wasn’t capable of curing.

A political decision was taken- in a process that some say did not include SEBI -to make IRDA the regulator for ULIPs. Some say insurers rescued certain government public issues, and this was just quid-pro-quo. What happened doesn’t matter anymore-what matters are consequences.

It may just be that investors have been thrown to the wolves, to decide which financial product to take, all by themselves. Which, shamefully, is a bad thing because we suspect our collective ability to decide for ourselves; but until we demonstrate lack of stupidity by actually not buying these products, we will continue to hear calls for stronger regulation, reduced incentives and fiduciary responsibility.

At one level, it’s a free market; people should be able to buy what they want, even if they choose to overpay, especially when such information is available to them. On the other hand, we have seen a worldwide financial crisis built on the back of information asymmetry; you must decide based on what you know, and you can’t possibly know enough. The answer: regulate, de-incentivise, litigate. There has to be a little of each, because in the end we are not rational beings. But it looks like the government decision seems to have just favoured the unregulated market.

Buyer beware. If you ask me, I would tell you to blindly refuse any ULIP offered to you, for which you will undoubtedly receive a large number of unsolicited enquiries in the coming months. But maybe there is a way to benefit: I suggest you demand Rs. 500 per phone call, payable in advance. For this advice, I demand no commissions.

2nd post:

My last column, ‘The ULIP War’, has yielded a number of responses from anxious readers asking me if I would recommend exiting from ULIPs (Unit Linked Insurance Plans) they already own. I wish there was an easy way out like saying ‘yes’, but there are no blanket answers. The only correct answer is ‘it depends’.

People seem to want to exit ULIPs for, largely, two reasons – either they trusted people who made them buy such policies in ignorance, or they were looking to only invest for a few years and exit anyhow.

So a ULIP holder can:

* Stop paying any further premiums, and consider withdrawal immediately or within a few years.

* Continue the policy, paying further premiums till a point where exit or continuance can be considered afresh.

Stopping further premiums is a knee-jerk reaction. Most ULIPs are designed so that if you stop prematurely there is a significant hit to your ‘fund value’; each product has its own idiosyncrasies. Since such surrender charges tend to diminish over time, it might actually make sense to continue your policy.

For instance, in one policy I consider, they mention that should you discontinue paying premiums within three years of starting the policy, they will hold your money until the three years are complete and then pay it back to you after deducting surrender charges. If, like most normal people, you think a small surrender charge is no big deal, the very next page tells you the charge is 75% in the second year, and 50% in the third year, effectively burning a significant hole in your pocket.

Look further. As the brochure says, 30% of your first year’s premiums have already vanished through a ‘Premium Allocation Charge’. A complex ‘Fund Management Charge’ results in the loss of about 6% of your premium, additionally. So a person paying Rs. 100,000 annual premium will, after one year, have this kind of decision to make:

* After year 1, I’ve paid 100,000. I have lost 36,600 to charges, and the remaining amount after some gains is Rs. 70,000.

* If I stop paying any further premiums now, I stand to lose another 75% as surrender charges, and I’ll have to wait another two years to get what’s left.

* That means if I exit right now, I’ll get only about 17,500 out of the 100,000 I invested.

* If I continue to pay premiums for just one more year, and I do similar calculations, including future charges: assuming a 10% gain on my portfolio, I would’ve invested 200,000 and will get back about Rs. 88,000.

* For another two years, I’ll have paid 300,000 and will get back 222,000

* After five years, it starts to make me ‘positive’ – that is, I invest Rs. 500,000 and get back Rs. 572,000. The main reason – surrender charges after paying five premiums is zero.

What it really means is that all other things being equal, it’s better to stay invested for the five-year term in this policy and then consider an exit, because before that date, you lose money in exit charges. While you may have been sold the policy on the idea that you have to pay just three years of premium, the optimal date for this policy is five years. It will differ from policy to policy.

In another case, the insurer charges 100% of the first year’s premium as charges. After one year, you have zero in your fund account; which should make the decision very simple – leave now, and incur no further costs.

(A technical issue to consider here is that the first year’s premium is actually returned to you after 15 years, if you really want to continue to pay premiums that long, or wait that much. Given their costs are higher than competitive products – mutual funds – in subsequent years, you will make a better return should you exit in the first year and buy those other products instead.)

Note: See a full spreadsheet of both products here. Observe that I don’t recommend exits: Exits should be considered with an analysis in mind.

This ‘exit after the first year’ is a leap of faith for many. Effectively, they would have lost the entire amount of money, and we are psychologically averse to taking a loss. This is categorized as a ‘sunk-cost fallacy’. We want to continue the policy even though we have, under all circumstances, lost all the money we have already invested, and continuing the policy is actually much more inefficient compared to saying goodbye and investing in other products instead.

An example of a sunk cost is evident in business – many projects are continued despite all evidence pointing to the fact that there is no further business case for it — (The Concorde fallacy.) Or, you pay a lot of money to buy a ‘membership to a five -star hotel, which offers you discounts – and then you keep wanting to go back there to ‘recover’ the money, even if you’re bored stiff of the food, or it’s priced too high even after the membership discount.

Buying timeshares with a large sum upfront also preys on a similar concept – once you buy in, you will rework your holidays according to the timeshare’s availability, going to places you might not otherwise go, because you’ve paid all that much in advance and by golly, you’re not going to lose any of it. Except it was lost the minute you paid for it.

In a way, this is throwing good money after bad, and is usually done to satisfy that part of our brain that is wired to avoid losses; it’s not rational, but it’s the way we are.

Note also that the decision to stay in a policy, like in the first example above, is justifiable because the initial investment is not necessarily a sunk cost; there are no better options available that would make returns better. For instance, quitting in year 1 and putting subsequent amounts in a mutual fund still does not make more sense than continuing on with the policy for five years, because the ‘gain’ that happens in year 5 because of dropping surrender charges outweighs the loss you take now. On the other hand, the ’30% policy allocation charges’ are sunk; regardless of what you do now, it’s gone.

The problem, unfortunately, is that many such policies, which make sense for a long-term investor, have been sold with the short term in mind. People are told to pay for just three years and you’ll see a lot of money. While it is evident now that will not happen, bidding adieu to the product now versus a few years later will depend on a number of factors that are specific to your situation: the surrender charge schedule, additional costs going forward, comparable completion and your ability to continue paying premium. It’s sad that products are this complicated, but that is our current reality. I hope there will a less muddled tomorrow.

B2B Marketing: 10 essential social media tips

By Cristina Warren

When we write about how companies or individuals are using social media in their marketing strategies, it’s usually in the context of a business to consumer relationship. However, business-to-business (B2B) marketing is really getting a boost from social media as well. According to a recent study, 60% of B2B marketers plan to increase social media marketing spending this year.

Non-B2B-centric services like Twitter and Facebook can still offer great opportunities for B2B shops. Sometimes, the approach is the same as it would be in non-B2B marketing, sometimes it can be very different.

Figuring out how to best implement and harness social media in the course of B2B marketing can be difficult but we’ve put together ten tips to help get you on the right track!

1. Use Twitter Effectively

This may seem like a no-brainer, but plenty of businesses and even B2B marketers aren’t on Twitter. Get an account on Twitter and start engaging. While having profiles on other social media platforms like Facebook and LinkedIn can be equally important, Twitter remains one of the best ways to find and engage with others.

How do you do that? Start by searching for phrases relevant to your business and by monitoring those searches regularly. Look at what people are saying and join in the conversation. If people aren’t necessarily looking for your business offerings right away, start joining other conversations of interest. The more you build bridges, the more likely you are to be noticed.

Second, use hashtags. The #B2B hashtag, for example, will connect you with several other like-minded businesses who are also trying to leverage Twitter to build an online presence. Don’t overdo it, though. There are some people #who #tweet #like #this.

We’ll discuss this in the next point, but consider Twitter to be an informal medium. With social media, businesses can (and should) be human again. That’s why it’s safe to use Twitter not just for pure self promotion but to build a meaningful relationships with those who you are likely to do business with you in the future. If you feel comfortable using your business Twitter feed to talk about what makes you tick (versus purely promoting your business), you might be pleasantly surprised to see that your audience might very well be receptive to that messaging.

What’s great about Twitter, especially from a B2B perspective, is that you can follow just about everyone. Take advantage of the opportunity to follow your industry influencers, connect with potential customers, and keep a heads up on the competition.

A great example of Twitter usage from a B2B perspective is @salesforce. Salesforce has used its Twitter feed to share relevant news, to empower current customers, and to offer customer support.

2. Figure Out Your ‘Social Voice’

Social media works best when it is personal and authentic, and thus, it’s important to make sure that the way you communicate when using social media tools comes from a personal and authentic place.

Kevin Dugan, the Director of Social Marketing for Empower MediaMarketing recently wrote a blog post about finding your social voice. I spoke with Dugan about establishing a social voice, and he had this to say:

“It is critical that brands understand a social voice is different from brand voice. Social voice reinforces the brand voice indirectly. Social voice doesn’t follow communication guidelines or identity standards. That’s because a social voice equates to a person. A brand voice is anonymous while a social voice can be found on Google. They must also have an understanding of the brand and a passion for it.”

Social networks are now helping to put the “human” back in businesses again. The traditional messaging of yore has been replaced by businesses who actually appear to show that they care about their customers. With a social voice, informal is perfectly acceptable. Having a social voice, as opposed to just a generic “brand voice,” is an important step when connecting with potential customers. Prospective customers want to connect with businesses who think just like them.

Just because your clients are other businesses doesn’t mean that the “social” aspect of social media needs to disappear.

3. Take Advantage of Opportunities on LinkedIn

LinkedIn is continuing to get bigger and bigger and it continues to be a great resource for businesses and employees to connect with one another.

One of the best things about LinkedIn is the Shared Connections feature. This feature makes it possible to find people like potential clients and then see what connections you have in common. Shared Connections then makes getting a virtual introduction that much easier.

building up a strong LinkedIn network and being willing to introduce others (in good faith, of course always use your best judgment) can also increase what opportunities you can get in the future.

B2B marketing is often built through trust and word of mouth. Having a shared connection is a great way to start establishing some of that trust from the very beginning.

LinkedIn also has a community of active participants. LinkedIn Answers serves as a knowledge base where business representatives can establish authority and expertise by participating in the ongoing discussions. LinkedIn Groups is an opportunity for business professionals to interact with other topics relevant to his/her interests. One business successfully used LinkedIn Groups as a way to build business leads. This business opted to engage in relevant industry discussion and offered business services when requests were made, thereby bringing in a highly targeted business lead. Actively participating in LinkedIn is often one of the best ways to not only help people out, but also to make a connection for your service and even generate leads.

Answering questions across LinkedIn Answers and LinkedIn Groups doesn’t mean to simply put out the marketing blurb, but to really engage and offer feedback and solutions. Again, social media is most effective when it is genuine.

4. Start a Blog

Social media provides the opportunity for companies to promote themselves but also to welcome commentary from a community of peers. By starting a blog, you give your readers an opportunity to see you with your social voice outside the typical corporate website’s newsroom. Blogs become platforms where you can announce new product releases, share personal company stories, answer any specific questions from your customers, and empower customers to achieve success with your products and service offerings. Blogging can also establish business professionals as thought leaders in their field, thereby aiding with client acquisition.

Blogs can build up qualified prospects through search engine rankings too. Be sure to update your blog regularly with valuable content and follow up with the comments written on each individual post.

5. Monitor Your Industry

Social media means that content is being posted everywhere, and businesses have a unique opportunity to gather intelligence to make well-educated and informed business decisions. Google Alerts is a great tool to keep up with what’s happening in relation to your company, your industry and your competitors. You can get updates via e-mail or in RSS (and even in real-time) about new search results or news stories for a certain query or topic.

Further, free tools like Social Mention and YackTrack will monitor the social sphere for other mentions of your business on social sites, especially. BackType will take that a step further and monitor phrases in comments on blog posts. All of these aforementioned services can be emailed to you in a daily digest format which your team can evaluate to find opportunities.

If you don’t already have alerts set up on these services for your company name, do it now. Also set up a more generic alert for your industry as a whole to see what people are talking about. If you want to see what your competition or other big industry players are doing, add those to the mix as well.

Monitoring can also be useful because you can then highlight the big stories on your own social media channels like Facebook, Twitter, Google Buzz, etc.

6. Be Consistent and Don’t Be Afraid to Follow Up

While you don’t want to be creepy, it’s important to not let potential opportunities slip by when using social media. If you’ve answered someone’s question on LinkedIn or on Twitter, don’t be afraid to reach back out to that person to ask if they have any follow-up questions or if you can send them more information. There’s an abundance of opportunity to strengthen a business relationship but it starts by initiating and then making sure that your business is fresh in your prospects’ minds.

Staying engaged and staying communicative is really important. Social media is not about setting it and forgetting it. It’s about being social, so don’t be afraid to reach out and check back in with potential leads you meet using social media. Similarly, don’t be afraid to direct message your followers on Twitter when an opportunity presents itself. They followed you because they want to hear from you. Use that opportunity to your advantage but don’t overdo it. Auto-DMs are a no-no.

If you’re going to blog, don’t leave that blog stagnant. Provide valuable content on a regular basis. Give employees of your company an opportunity to help build your brand. You can get a lot of great blog content by involving many company employees in the process. Similarly, get many employees of your company to utilize the social networks and to be continually responsive to customer inquiries. Remember, the more visible you are on the social networks, the more likely you are to be remembered when another business actually needs to utilize your services.

7. Leverage Your Analytics for Business Metric Measurement

After you’re involved enough in the social space, you’ll likely see tweets, retweets, traffic, and social network links that point to various parts of your company website. Take a look at your website analytics and start seeing where you’re making a difference, especially as it relates to ROI measurement. Don’t lose sight of your business metrics and start considering practical social media measurement to assess clickthroughs, popularity of links, and other important metrics.

As part of measurement, consider using URL shorteners. Not only do they make links more manageable (and limit the number of characters in a Tweet or Facebook message), they also can be a great way to track data as many URL shorteners provide valuable statistics about the performance of each individual shortened URL. Monitor this data throughout the process with your main website analytics package to see if your message attached to the shortened URL resulted in conversions.

When looking at conversion trends or successful tools in building leads with social media, reviewing analytics data is crucial. It gives you insight into content that performs very well in the social space but also through other marketing techniques, such as search engine optimization. Use the data as an opportunity to improve your content or your social media/search marketing efforts.

8. Find and Follow Industry Influencers

B2B social media marketing is often about connecting with the right people and about building relationships. Social media makes both of these actions simple and painless. Being aware of who the influencers in your industry are and then following them, whether it’s on Twitter, Facebook or their own blogs, is the first step to building a connection with those influencers. With a genuine relationship, these influencers may be able to help you make your mark in the social media marketplace. This is especially true of influencers who may already have your target audience at their disposal.

This doesn’t mean you need to retweet every tweet or share every blog post on Facebook, but it does mean that you should be aware of who the movers and shakers are. By following them and then reaching out when appropriate or just to get to know them further, you have a much better shot at getting some attention.

Even if you’re not necessarily connecting to influencers, social media affords the opportunity to connect with other people in your industry and your customers. Use the various social media platforms as an opportunity to connect with these industry colleagues and peers and build upon each other. Consider celebrating your colleagues’ or customers’ success. Make it known that you’re here to help them not just yourself. Repeat this process with anyone of interest and you’re bound to attract eyeballs.

9. Use Social Media for Giveaways and Promotions

Sometimes, the hardest part of social media is sticking out from the sea of other users. Giveaways and promotions are a great way to help differentiate yourself and your business. Using Twitter, LinkedIn and Facebook, you can target your desired customer base and then let them know (if appropriate) about different promotions or giveaways related to your product. If you offer a service, consider giving a free year to a loyal customer. If you manufacture products, give some away.

Offer a coupon on your company’s Facebook Page and pair it with a lead-generation form for future contact. Let people know on Twitter about specials or contests that are going on and follow-up with those that show an interest. Perhaps you can have a retweet contest where you can monitor responses or host some trivia on your Facebook Page. You can also open an online survey to get feedback about your offerings and reward participants. The possibilities are endless. Creativity in this capacity breeds success.

Companies like Wildfire make it really easy to build these sorts of promotions directly inside your own social media channels.

10. Don’t Be Creepy

If you use social media like a keyword searching robot, you are going to come across as creepy and turn off potential clients. Don’t be creepy.

Use best judgment and common sense when approaching people using social networks. If you wouldn’t want to be approached the way you are approaching another user, don’t use that approach. It’s as simple as that. Social media etiquette isn’t much different than real life relationships, so what won’t work in “real life” probably won’t work online.

Respecting boundaries doesn’t mean you can’t still answer questions, engage and follow-up with potential leads, it just means that if it’s clear that the other party isn’t interested, or more importantly, if the context of their communication really doesn’t involve or seek out input from your company, don’t do it.

Context is really important in social media and it is something that is very, very easy to overlook. While we think that using keywords and Google Alerts are good methods for keeping atop of your field, that doesn’t mean you can automate your responses or just go into autopilot based on those alerts.

‘Have a strong risk management framework… Success is yours’…. Paresh Bhagat

 ‘Genius Trader’, that’s what they call him in his close circles. But unlike his high profile contemporary Rakesh Jhunjhunwala, this man is low profile. A man of few words, it took almost a month to conclude this interview…

But when it happened, what came out was his brilliant approach to trading. His disciplinary attitude and an absolute aversion to risk reflected the similarities he shares with the likes of legendary investors Jesse Livermore, Warren Buffet and Sir John Templeton.

Simply put, he believes ‘No matter what information you have, no matter what you are doing, you can be wrong… and when you are wrong: just take your loss and get out… That’s Paresh Bhagat, Chairman of Mangal Keshav Securities, whose characteristics and investing principles have made him, what he today is: A Genius Trader!

 (Please refer to the Research Reports Tab above to get the interview).

Kiss of death for Sensex and Nifty

One of the most bearish formations in our pattern library has been established on many stocks and indices in India. This pattern has also developed in Chinese equities, FTSE, currencies like EUR/JPY, GBP,etc.

The pattern formation has been too classic this time which usually results in rapid declines over the next few months. We have discussed this pattern and its implications in the diary (Quant Reckoner) which was despatched during early Jan ’10. In the latest update of that report which was released on Wednesday (20-Jan-10), we have showcased that  the market failure is developing the “Kiss of death” pattern and can signal rapid declines.  

 

This pattern is based on the weekly MACD and its mechanics is as follows:

1)  Weekly MACD gets into a sell mode (MACD crossing below the trigger)

2)  Market survives temporarily and moves to a new high and then fails

3)  The move to new high pulls the MACD upto the trigger and then starts moving down again from the trigger. In other words, MACD moves up and kisses the trigger and then starts running down again (hence, we use the term “Kiss of death”.

(Please refer to the Research Reports page to get the full report. TAB ON THE TOP)

Sell, sell and book profit !!

A full week of trading without much progress in either direction for the BSE Sensex. The chart pattern is tantalisingly poised and may move either way. Let us first take a look at the 6 months bar chart pattern of the BSE Sensex index:-

The Sensex broke above the trend line connecting the tops of the rising wedge pattern almost a month back but has continued to move sideways, and has failed to cross the previous high of 17200. Last week the index alternated between lower and higher closes, and is now resting on the trend line. As we will see in the 3 months bar chart pattern of the BSE Sensex, the index is also resting on the 20 day EMA, which has provided good support to recent corrections.

While there is a possibility of the Sensex moving up again – particularly if the FIIs start pouring in money, the chances of a break downwards is increasing. As the three EMAs are still merrily moving up, the distance between the 50 day EMA and 200 day EMA has increased more than 2000 points. This indicates a likely correction in the near future.

The technical indicators are all looking bearish. The RSI, MFI, Aroon, MACD and slow stochastic are all in the positive zone but are moving down steadily. Most importantly in the shorter term, market sentiments seem to be turning bearish, as good news (like the Reliance Industries 1:1 bonus after 12 years, and the Q209 results of Infosys that turned out better than consensus estimates) failed to produce any buying interest.

Watch out for a downward break below the lower trend line joining the bottoms of the rising wedge pattern. That may start an ‘end run’ that could lead to a sharp correction. The rising wedge pattern is quite bearish and is usually followed by a sharp downward break.

Bull markets climb a wall or worry, and a large inflow of liquidity can nullify all technical analysis – as has happened a few times during this bull rally. So avoid shorting the market.

Bottomline? The chart pattern of the BSE Sensex index is poised at a crucial support level. Stay on the sidelines and watch the unfolding battle between the bulls and bears. Keep tight stop-losses and book partial profits at every opportunity.

Banking: The Next Crises & The Ignorance of the Economic Establishment

Rajib Handa

In over six decades post India’s independence from the British I never recall Repo rates dropping down to 2 per cent and peak rates on 5 year unsecured bank deposits to 7 per cent. Compared to a CPI of 12 per cent banks are now offering negative returns of 5 per cent per annum to depositors, while throwing money at near bankrupt Real Estate concerns at artificially induced low interest rates. The CAPM pricing theory propounded by Nobel laureates Muller and Modigliani professed that the only difference between debt and equity was the tax. So why do investors expect ROEs of 20 per cent on Equity but are willing to settle for 2 per cent income on deposits? If this is not laying the seeds of a gargantuan Real Estate Asset Bubble and everything else connected with it, then what else is it? The repercussions of easy money will be felt over a number of years, but the disaster will strike investors in many forms. So Brace yourself up. It’s easy to understand how loose monetary policy causes inflation and/or speculative bubbles. But the economic establishment in Washington, on Wall Street, and more or less all over the world refuses to acknowledge the cause and effect relationship! They insist on Keynesian theories of macro managing the economy mainly by monetary and fiscal policies, thereby rapidly increasing the government’s influence. Their models and theories totally missed the importance of the real estate bubble and its aftermath … the most severe crisis since the Great Depression. And they were incapable of forecasting the meltdown of the banking system. It should be clear that following the wrong models and theories leads to the wrong conclusions and wrong policies. And that’s exactly what’s going on today. The policy prescriptions since this crisis erupted are the very same that laid the foundation for the real estate bubble. So the toxin that caused the crisis is being given as the antidote! This has led to a postponement of the next stage of the current crisis. Yet if governments keep throwing trillions down these rat holes, we’ll end up with a financial and economic catastrophe much larger than the current one. So although I suggest you take a bullish medium-term view, you should remain very bearish about the long-term. Remember … Secular Bear Markets Consist of Cyclical Swings I believe that the stock market and the economy entered a secular bear market in 2000 when the technology bubble burst. The first recession took place in 2001, and the first cyclical stock bear market ran from 2000 until 2002/03. That’s when governments all over the world implemented extremely easy monetary and fiscal policies. Their strategy worked … the recession stopped in its tracks. But it came at a very high price … starting a real estate bubble. This artificial and unsound boom lasted until 2007. Then the bubble burst and all hell broke loose! And the second recession and the second cyclical stock bear market began. Again governments stepped in, but to a much larger degree than in 2001-2004. And, for now at least, they’ve rescued the banking system by bailing out nearly all big banks and initiated a medium-term uptrend in the world’s stock markets. The long-term analysis is simple and easy: With each round of counter crisis policy, governments are upping the ante. So each crisis is getting more expensive and more damaging than its predecessor. The severity of the 2007/08 crisis should make it clear what an even worse version could look like: The total collapse of the banking system and of the world’s dollar-based financial system, probably including the bankruptcy of some states. Even hyperinflation seems to be a probable outcome of these policies.

8 key ratios to spot the right stocks

It’s a very common dilemma for first time stock buyers. You want to invest in ‘safe’ stocks yet have no idea about the process involved. Should you trust your broker? Or should you trust the markets analysts. And at the end of the day you are left confused by the myriad of opinions and advices that are thrown at you.

Instead, why not understand the parameters yourself so that you can make the best choice? To help you understand the intricate art of choosing the best stocks to invest in, here are eight key ratios. Read on, understand…and happy investing!

Ploughback/reserves: Every year, a company divides its net profit (profit left after subtracting various expenses including taxes) in two portions: ploughback and dividends. While dividends are handed out to the shareholders, ploughback is kept by the company for its future use and is included in its reserves.

Ploughback is essential because besides boosting the company’s reserves, it is a source of funds for the company’s expansion plans. Hence if you are looking for a company with good growth prospects, check its ploughback figures.

Reserves are also known as shareholders’ funds, since they belong to the shareholders. If a company’s reserves are twice its equity capital it can then reward its shareholders with a generous bonus. Also any increase in reserves will push the share price of your share.

Book value per share: This ratio shows the worth of each share of a company as per the company’s accounting books. It is calculated as:

Book Value per share = Shareholders’ funds / Total quantity of equity shares issued

Shareholders’ funds can be computed by subtracting the total liabilities (money owed to creditors) of the company from its total assets. It can also be calculated by adding the equity capital to the company’s reserves.

Book value is an old record that uses the original purchase prices of the assets. However it doesn’t show the present market price of the company’s assets. As a result, this ratio has a restricted use when it comes to estimating the market price of the shares, but can give you an estimate of the minimum price of the company’s shares. It will also help you judge if the share price is overpriced or under-priced.

Earnings per share (EPS): One of the most popular investment ratios, it can be computed as:

Earnings Per Share (EPS) = Profit Post Tax / Total quantity of equity shares issued

This ratio computes the company’s earnings on a per share basis. E.g. you own 100 shares of ABC Co., each having a face value of Rs 10.

Assume the earnings per share is Rs 10 and the dividend declared is 30 per cent, or Rs 3 per share. This implies that on every share of ABC Co, you earn Rs. 6 each year, but you actually get Rs 3 via dividend. The balance of Rs 4 per share goes into the ploughback (retained earnings). Had you purchased these shares at par, it implies a return of 60 per cent.

This example shows that instead of looking at the dividends received from to company as the base of investment returns, always look at earnings per share, as it is the actual indicator of the returns earned by your shares.

Price earnings ratio (P/E): This ratio highlights the connection between the market price of a share and its EPS.

Price/Earnings Ratio (P/E) = Price of the share / Earnings per share

It shows the degree to which earnings of a share are protected by its price. E.g. if the P/E is 40, it means the share price is 40 times its earnings. So if the company’s EPS is constant, it will need about 40 years to make up for the purchase price of the share, after taking into account the dividends and the capital appreciation. Hence low P/E means you will recover your money quickly.

P/E ratio shows what the market thinks about the earnings potential and future business forecast of a company. Companies with high P/E ratios are the darlings of the investors and thus enjoy a higher market rating.

In order to use the P/E ratio properly, take into account the future earnings and growth projections of the company. If the current P/E ratio is low, as against the future prospects of a company, then the shares make an attractive investment option.

But if the company is saddled with losses and falling sales, stay away from it, despite the low P/E ratio.

Dividend & yield: Dividend is the portion of the profit that is distributed amongst shareholders. Companies offering high dividends, normally don’t have much of growth to talk about.

This is because the ploughback required to finance future development is insufficient. Similarly, those companies in high growth sector don’t give any dividend. Instead here they give sharp capital appreciation, which ultimately will lead to higher dividends.

So it makes much more sense to invest for capital appreciation instead of dividends. Rather it makes more sense to invest for yield, which is nothing but the association between the dividends and the market price of the shares. Yield (dividend yield) can be calculated as:

Yield = (Dividend per share / market price of a share) x 100

Yield shows the returns in percentage that you can expect via dividends earned by your investment at the current market price. It is more useful than simply focusing on the dividends.

Return on capital employed (ROCE): ROCE is the ratio that is calculated as:

ROCE: Operating profit / capital employed (net value + debt)

To get operating profit, add old taxes paid, depreciation, special one-off expenses, and special one-off income and miscellaneous income to get the net profit. The operating profit is a far better indicator of the profits earned by the company instead of the net profit.

Hence this ratio is the better indicator of the general performance of the company and the company’s operational efficiency. It is one of the most useful ratio that lets you compare amongst the companies.

Return on net worth (RONW): RONW is calculated as

RONW = Net Profit / Net Worth

This ratio gives you an idea of the returns generated by investing in the company. While ROCE is an effective measure to get a general overview of the profitability of the company’s business operations, RONW lets you gauge the returns you can earn on your investment.

When used along with ROCE, you get an overview of the company’s competence, financial standing and its capacity to generate returns on shareholders’ finances and capital employed.

PEG ratio: PEG is an essential and extensively used ratio for calculating the inbuilt worth of a share. It helps you decide whether the share is under-priced, totally priced or overpriced.

To derive the ratio, you have to associate the P/E ratio with the expected growth rate of the company. It assumes that higher the growth rate of the company, higher the P/E ratio of the company’s shares. Vice versa also holds true.

PEG = P/E / expected growth rate of the EPS of the company

In general, a PEG lesser than 0.5 is a lucrative investment opportunity. However if the PEG exceeds 1.5, it is time to sell.

These are some of the most critical ratios that must be considered when purchasing a share. Extensive reading of the financial performance of the company in newspapers and magazines will help you get all the relevant information to get the correct decision