CAT 2024 Slot 1 · DILR · Question 4

CAT 2024 Slot 1 previous year question on Mixed DI (Radar, Triangular, Stock etc), with the answer and a step-by-step solution.

Mixed DI (Radar, Triangular, Stock etc)DATA INTERPRETATION -High LevelMultiple choiceMedium

Set 1: Candlestick Plot of Seven Shares — this question belongs to a set. Read the full set with all 4 questions →

The chart below shows the price data for seven shares - A, B, C, D, E, F, and G as a candlestick plot for a particular day. The vertical axis shows the price of the share in rupees. A share whose closing price (price at the end of the day) is more than its opening price (price at the start of the day) is called a bullish share; otherwise, it is called a bearish share. All bullish and bearish shares are shown in green and red colour respectively.

What would have been the percentage wealth gain for a trader, who bought equal numbers of all bullish shares at opening price and sold them at their day’s high?

  1. A

    72%

  2. B

    80%

  3. C

    50%

  4. D

    100%

Pick an option, then check.
Answer & solution

Answer: Option B

Solving the set

How to read a candle: the thick body shows the opening and closing prices, and the thin lines (wicks) above and below show the day's high and low.

• Red (bearish) candle: top of the body = opening price, bottom of the body = closing price (the price fell).

• Green (bullish) candle: bottom of the body = opening price, top of the body = closing price (the price rose).

Step 1 – Read all seven candles against the price axis (gridlines every Rs 200).

Share

Colour

Opening (Rs)

Closing (Rs)

High (Rs)

Low (Rs)

A

Red (bearish)

2200

1800

2400

1200

B

Red (bearish)

2000

1700

2000

1400

C

Green (bullish)

800

1200

1400

800

D

Green (bullish)

500

1000

1200

300

E

Red (bearish)

1300

1100

1400

1100

F

Red (bearish)

1800

1600

2000

1200

G

Green (bullish)

1200

1700

1900

1000

Step 2 – Classify the shares. Bullish (green): C, D and G. Bearish (red): A, B, E and F.

Step 3 – Compute SPV = (High − Low) / ((Open + Close)/2) for every share.

Share

High − Low

Average of Open & Close

SPV

SPV > 0.5?

A

2400 − 1200 = 1200

(2200 + 1800)/2 = 2000

0.60

Yes

B

2000 − 1400 = 600

(2000 + 1700)/2 = 1850

0.32

No

C

1400 − 800 = 600

(800 + 1200)/2 = 1000

0.60

Yes

D

1200 − 300 = 900

(500 + 1000)/2 = 750

1.20

Yes

E

1400 − 1100 = 300

(1300 + 1100)/2 = 1200

0.25

No

F

2000 − 1200 = 800

(1800 + 1600)/2 = 1700

0.47

No

G

1900 − 1000 = 900

(1200 + 1700)/2 = 1450

0.62

Yes

Step 4 – Compute the daily loss = (Open − Close)/Open for the bearish shares named in the questions. A bullish share closes higher than it opens, so its 'loss' is negative (it gained).

Share

Opening − Closing

Daily loss

A

2200 − 1800 = 400

400/2200 ≈ 18.2%

B

2000 − 1700 = 300

300/2000 = 15%

F

1800 − 1600 = 200

200/1800 ≈ 11.1%

G

1200 − 1700 = −500 (a gain)

Negative (no loss)

This question

From Step 2, the bullish shares are C, D and G. The trader buys an equal number (say one) of each at the opening price and sells at the day's high.

Bullish share

Bought at opening (Rs)

Sold at day's high (Rs)

Gain (Rs)

C

800

1400

600

D

500

1200

700

G

1200

1900

700

Total

2500

4500

2000

Percentage gain = 2000/2500 × 100 = 80%.

Shortcut: Equal numbers of shares means we simply add the prices: (4500 − 2500)/2500 = 0.8.

Hence, the answer is option 2.

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