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nrollment for new paid subscriber started only for limited subscribers. http://mytradingtechnique-mysar.blogspot.com/p/services.html  Daily MySAR Levels For Future Segment : Daily MySAR Levels For Cash Segment : | |||||||
  From 15th June till today, In Nifty future, 9009 points (i.e. Rs. 4,95,,450) earned In Bank Nifty 17172 points (i.e. Rs. 4,29,300) earned  Maximum exposure used 4-5 lots each in Nifty and BankNifty during these days. For Total Profits earned in Nifty and BankNifty : | |||||||
Many Many Congrats to all positional traders | |||||||
Security | High | Low | Close | MySAR_A | 5-EMA | High-EMA | Low-EMA |
Nifty (F) | 5328.80 | 5231.30 | 5285.35 | 5273.51 | 5306.86 | 5379.84 | 5256.85 |
Bank Nifty (F) | 10439.70 | 10141.00 | 10311.00 | 10261.44 | 10362.69 | 10574.63 | 10219.20 |
Pivot Levels to be used on 26th March    | |||||||
For other Nifty 50 (future) scrips click link :  Reasons to incur losses Many people think trading in the stock market is the easiest way to make money. Especially now a days young generation think so and does not want to change their ideology. They want easy and quick money without any painstaking…., and ultimately it results in to heavy losses. Of course as per my opinion, trading and making money in stock market is easy…..provided one possesses “3D” and “3M” factors. “3D” Factors are : Discipline…., Determination ……and Dedication “3M” Factors are : Mind ….., Method…..and Money. In the absence of all these factors it is natural that any trader would get negative results in his trades committing certain mistakes. Below are some of the ways of undisciplined trading. Have a guard against them otherwise market will wipe you out completely. Trading during first 15 minutes of the session: The first 15 minutes of the trading day is mostly driven by emotions of the traders affected by overnight movements in the global markets and hangover of the previous day’s trading. Also this period is used by the entry of novice traders in taking new entry which might be contrary to the real trend which emerges only later in the day. Mostly experienced traders simply watch price movement during first 15 minutes to study intraday patterns of the trend and subsequent break outs. Similarly last 15 minutes the trend is not real due to squaring off of positions by the intraday traders. And hence new entry should be avoided during last 15 minutes too. Failing to reduce the position size: A trader should be flexible in reducing his position size whenever market is not giving clear signals. For example if he takes an average position for 10 lots in nifty futures, he must be ready to reduce it to 2 lots only if situation of price movement arises so. This can happen either when a trader wants to trade counter trend or when market is not displaying a strong trend remaining in very narrow range. The size of exposure should be as per the market mood at the given point and partial profits should be booked as soon as the trades starts earnings two or three times the average risk taken. Undisciplined traders driven by their ego mostly do not reduce their positions nor become ready to book partially and ultimately put their trade into more risk. In fact a trader should be firm determined to book partially so as to reduce the risk factor. It creates confidence and faith in the trade taken, protects the employed capital. Over Trading: In most of the cases intraday trades lose money in over trading. They use the exposure given by the brokers for intraday trading. But when trade goes wrong they lose their most of the part of their capital due to over trading. In fact a disciplined trader creates position size as per his own financial capacity. And as a result he has not to lose and waste unnecessary time in search of finance when his capital gets reduced due to hitting of stop losses. When a trader uses exposure given by the broker, the broker earns his brokerage, but trader earns only if the trade goes in his favor. If the trade goes against him, he has to incur loss for the whole trade. Let us take example, if a trader has 35k for trading, he is capable to trade only one lot of nifty future with the general rule of stop loss of 20 points. Now if he trades only for one lot, he may have to lose 20 * 50 = 1000. But if his broker gives him 4 times exposure and if he trades for 4 lots …and if the trade goes wrong, he would have lost 200 * 20 = 4000. Means his risk become four time more and it reduces his capital from 35 k to 31 k only …more than 11% loss. Of course, one may argue that if the trade goes in his favor, he would have earned more due to large size of position. But this may lead to conversion of trading into gambling in the long run. And at that time he will lose more and more due to over trading, getting not any help from any side. The market has no mercy for any mistake made by the trader. The disciplinary rule says: “Don't judge the success of anyone in the trade by the amount of money he has made. Judge the success by his trading strategy. Money can get made and vanish in the blink of an eye. A good strategy stays with you for a long period of time and success becomes enduring.” Today most of the young traders have got such type of mentality to over trade with only token money, but mostly 90% failed in such trading. The pity is that they even do not accept the reality, but go on finding excuses. When they get success, their feelings for winning become so much powerful that they lose control for taking new right decisions for the new trades and ultimately wipe out their entire capital funds only due to over trading. Failing to treat each trade as new one: Every trade should be considered new trade and only normal profits should be expected from that new trade. Generally after losing money in the first trade of the day, an undisciplined trader expects some more profits over and above his loss incurred in the next trade. Say if he loses Rs.1000 in the first trade, for the second trade, his expectations become to earn more than Rs.1000/- without considering the exposure and price movement trend whereas in real sense the normal profit would be less than Rs.1000….And here he fails by joining new trade with the old one. Every trade is to be considered new independent trade and only normal profits should be expected every time. Super normal profits should be considered as bonus when they occur, but should not be expected every time. Over eargerness in booking profits: Traders should not be over eager to book profits so long as the market is acting right in favor of Trade. Most of the traders tend to book profits too early in order to enjoy the winning feelings, and thereby letting go substantial trends even when they have got a good entry. If at all, profit booking should be done in stages, always keeping some position open to take the advantage of the rest of the trend. A disciplined and determined trader knows : “His trading should consist of small profits, small losses and big profits….and big losses must be avoided.” Lack of self confidence and self judgement: Lack of self confidence mostly shakes the faith of the trader for his decision. Being ignorant of technical knowledge and other disciplinary rules, generally traders have tendency to wonder for better trading system, better scrips, better trades. They go on asking for trades to their relatives, friends etc. go on hearing media, go on reading tips in newspapers, magazines, web sites etc. And all these noise create confusion in traders’ mind, do not allow them to take right decision at right time, in short creates psychological pressure which ultimately result into losses either due to fear or greed factor. In fact a trader should not talk to a lot of people during the trading hours. He can talk to experienced traders, but after market hours, and talk should be for methodology instead of individual trade. And such talk will improve his trading ability in the long run. In short, a disciplined trader fully follows the Disciplinary Rules of Three Monkeys……of Mahatma Gandhiji. Do not hear evils Do not see evils Do not speak evils.  Following the disciplinary rules, a trader should constantly try to improve his trading skill. By trading skill I mean not only charting skill, but also position sizing and money management skills. Successful traders recognize that money cannot be made equally easily all the time in the market. They back off for a while if the market is too much volatile or choppy. He accept this truth of maket. He never blames the market …whatever the result market may give him, particularly in the case of losses. For him Market is supreme…..and Price is God. He accepts the market and price as it is. Even if he incurs losses in some trades, he believes that negative results arise due to his own faults, and not because of market. And such acceptance creates faith - fearlessness sooner or later in his mind and results in gaining in the long run. My teacher once said me, “Gauresh, in this stock market there is always a battle between bulls and bears. And you are one of the worriers in it…may be bull or may be bear….but being a worrier you must be well equipped before entering into a battle.” I seen so many traders trading on intra day basis, but have not any facility of real time data, have not capacity to sit tight in front of computer during the market hours, have too much less capital and using exposure given by brokers, lacking basic knowledge of stock marketing etc…..and ultimately wipe out their most of the capital funds. How a worrier without any equipment can fight….? Even wrestlers must have some basics with them to wrestle……. Three Thumb Rules : (1) Always trade only at the levels given.(2) Keep booking profits without missing a winning opportunity.(3) And once in profit, trail stop loss to the entry level to protect the capital funds. Wish you all happy and profitable trading ahead……… | |||||||
Showing posts with label Reasons to incur losses. Show all posts
Showing posts with label Reasons to incur losses. Show all posts
Reasons to incur losses
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