Dear friends !
This is a general discussion and friends are welcome to post their views in any manner they like. This is only meant for sharing views of friends.
All of us know that trading in the stock market involves risk and one should trade as per her/his loss bearing capacity. The followings are some rules that are known to most of traders who are having certain experience in the market and also should be known to new entrants
Intraday trading is an art rather than mere speculation. Some people think trading is gambling. But I have other views. Intraday trading is highly profitable if certain rules are followed.
RULES
- Expect the unexpected and protect yourself from being a victim to the adverse situation that may arise.
- Never ever trade without using STOPLOSS and if you think the stock will hit stops and go up then you may keep the level in your mind till the level reaches stops and quit boldly without any hope and accept the loss as a part of trading.
- NEVER be greedy to grab anything that you see rising.
- Book profits in stages say at 25%on Ist tgt 50% on 2nd tgt and balance as 3rd tgt hits. This may reduce your profits but also reduces your risk or trail stops to catch the big movement. Never be sorry if price returns from Ist tgt and hits stop at buy price or sell price. This does happen sometimes but only for 5% of the trades.
- While buying/shorting never jump and start trading rather wait and watch to see that the recommended levels sustain.
- Capital erosion is common in trading, therefore try to prevent it.
- The cause of failure in intraday trading is taking huge losses and small gains and cursing own self for being stupid.
- NEVER EVER fall in love with any stock. Rotate sectors.
- No prayers work in the market; only believe in levels and what you see in the screen. Never follow rumours.
- Never buy a stock because it has fallen much and vice versa.
- Never invest more than 25% of your capital on a particular stock and always sit on 50% cash.
- Big Players know where the stop is kept by the common mass and drag the market to that point to trap small players as happened on 31.07.2009
- Never be anxious to earn. Most mistakes are committed only due to anxiety
- Do not calculate loss/profit daily basis. If one earns daily its good, but must accept some loss at stops in a bad day and never feel sorry for that and concentrate on movement of market.
- Always trade with confidence and positive attitude.
- If you win 60% of your trades, you are a gainer at the end of the month.
- Hedge your delivery positions by buying put options if you are confident about market movement downward.
- Invest your gains from stock market in other assets at least 50% of the gains.
- Never take position in anticipation of a big move ahead either upwards or downwards. Hedge your position in such cases.
- Try to recognize the trend with the help of Index mover stocks like RIL, SBIN, ONGC, ICICIBANK, BHARTI,
- Always watch ATP(Average Traded Price) in your screen.
- Accept the fact that market is always right and smarter than the traders. Do not have the idea about beating the market. In fact, nobody has ever succeeded in doing so
- Market gives chance for earning every day; therefore do not feel sorry that you missed a golden chance/oppertunity. Rather try to find other oppertunities..
These are my personal views and also known to most traders.
Comments/views of friends are are welcome.
Thanks,
DEEPA ACHARYA
11 comments:
your post is very helpful for me
thank you
Good morning Deepaji
I am new for FNO & Intraday. Please add me
E-mail : kmpou@yahoo.com
Mobile : 9427318020
Deepaji,
You are PERFECT.
I can't say anything more than this.
Keep up the good work.
God Bless U.
Hi Deepa,
- Do & Donts , covered very exhaustively !
- Very interesting tickers , specially for new entrants.
Inspite of being aware of some of the basic rules, guess its human nature..read as greed, to overstretch & make mistakes, & repeat them.
May be we should aim to try & reduce the mistakes by strictly keeping in our subconscious these golden rules .
Tks ..for your efforts .
deepaji happy friendship day
every important thing is in a nutshell for a new comer as well as refreshing for the regular traders.you are not only giving calls on nifty and other calls ,in day trading as you had stated, but try to inform them about the salient features to be followed.your services are service to GOD. this is not an exaggeration.because some people would have lost and not finding a way to get back .but for them you are a power light house guiding them through.I SINCERELY PRAY THE ALMIGHTY BE WITH YOU. all the very best,
C.A.KRISHNAMURTHY
DEAR FRIENDS
One more point I forgot to add. Go short in the market as much as you go long in intraday trades as its difficult to earn one way.
Thanks and Happy Friendship Day
Deepa Acharya
KINDLY ADD MY ID MAM aumsweet5@yhaoo.in
Hi Deepa,
This looks like my list of mistakes :).
I still have one major problem... I book profit very early and exit losing trade very late. Hopefully I will overcome it now, as I have started putting SL.
Please advise how to put SL for positional/delivery trades.
Thanks in advance.
MS.
HI SMM
If you have a positional future Index/stock, you should have minimum half the amount of margin with you. In simple words, if you have a positional short/long of say 3 lacs(Contract value at entry)you should have 1.5lac as margin. If you are in gain follow at minimum 5% SL Closing Basis and if you have gained enough and still want to hold with handsome profit say 10-15% you may dare to have one more with the rest cash margin say 1.5lacs-margin for the positional future at that point of time. So even if you lose some in the 2nd trade you are a net gainer. So your capital is not at risk.
In case of delivery, as you own the stocks 5% Sl is enough and you may do intra(Sell at Res and Buy at dips) with those and reduce your cost price if market corrects and you want to hold delivery as long term .
Thanks
DEEPA ACHARYA
Hi Viba
You are added
Thanks
DEEPA ACHARYA
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