Showing posts with label lessons. Show all posts
Showing posts with label lessons. Show all posts

Jan 3, 2016

QUOTES FOR STOCK TRADING

QUOTES FOR STOCK TRADING INDIA
stock trading wisdom quotes
lessons in stock trading stock investing
trade less
trade with small SL
Trade with higher risk reward ratio.
Remain consistent in market.
Don't sit in front of screen whole time.
Have tremendous success in your system as far as it is not giving you losses.
join our team to earn and learn


Aug 16, 2014

SIGNS OF NEW TRADER

SIGNS OF NEW TRADER.

1      New Traders believe there is some magic trading method that always wins, they search for the Holy Grail of trading.
2      New Traders do not understand that the very best traders have strings of losses , losing months, and sometimes even losing years. They think rich traders always win.
3      New Traders want to know what is going up or down, they focus on tips instead of the mechanics of trading.
4      New Traders hand out advice freely to others, good traders realize that decisions are based on individual methods and do not give out tips.
5      New Traders are looking for that one big winning trade to go all in on, good traders are trading good systems that they risk 1% per trade on.
6      New Traders confuse bull markets for skill.
7      New Traders confuse luck for skill.
8      New Traders want advice, good traders want robust systems.

9      New Traders run from method to method and from mentor to mentor after every losing streak, good traders know exactly who they are and what methods they trade.

May 11, 2014

TRADER’S TWO MOST POWERFUL WORDS: So What!

TRADER’S TWO MOST POWERFUL WORDS


Let’s face it, no matter the outcome of a trade-lose, win, draw, and even the miss-traders are rarely satisfied with the result.  This is exactly why it is so important that we utilize the two most powerful words in a stock trader’s vocabulary. And no… it does not involve four letters!  The following is a list that you can use these two words with.  You will get my point.  Of course you can add to it if you like.
I missed the trade…SO WHAT!
This trade did not work…SO WHAT!
I excited a profitable trade too early…SO WHAT!
I excited with a loss too quickly…SO WHAT!
My stock gapped against me…SO WHAT!
The stock recovered without me…SO WHAT!
A stock I was bullish on was downgraded by an ANALyst…SO WHAT!
A stock I was bearish on was upgraded by an ANALyst…SO WHAT!
The market is not trending…SO WHAT!
The market is consolidating…SO WHAT!
The market is breaking support…SO WHAT!
The market is busting out of resistance…SO WHAT!
The economy stinks but the market is going higher…SO WHAT!
SO now do you understand WHAT makes these words so powerful?  They allow you to get on to the next trade or, shall we say, the next  ONE GOOD TRADE!


Nov 2, 2013

Percentage gain required to recover percentage loss

There is reason why big names like Warren Buffett and others in investment and trading put focus on 'not losing' money as their first rule.
When you lose money, you have to recover it first and get even before you make any profit on the initial or starting capital.
What happens is that when you lost money from the start or out of the initial investment or margin money in case of trading, you have to earn more in & terms to get even.
Above is the table depicting how much more you will need to make when you lose out of your capital and margin. If you understand the important of the same you will make your investment and trading decisions differently. This is perhaps one of the foremost important fundamental of risk management in stock trading and risk management in investment.

Oct 17, 2013

Education for Investors and Traders for Indian Stock Market

Emphasis on Education:
We have added a new dimension to our work. Yes, that is investors and traders awareness, education and learning. You have been sold tips and advice but never told even once rightly ‘how to invest wisely?’ or ‘how to trade smartly?’ or even the ‘basic financial planning rules’.

We will not just guide you to make money by buying and selling but help you improve your knowledge which will become a part of your wisdom for your entire life.
Education will be provided via webinar, personal phone call discussion, soft copy email files/e-books, spot seminars, group discussion, phone conference calls, and one-to-one discussion apart from the day to day interaction with your own relationship executive at the our premises during the course of your trading.

EDUCATION FOR INVESTORS:
Investors need education more than knowledge. Not all can gather wisdom to become an astronaut, or rocket scientist yet everybody can know the basics of how a space mission works and what to do in space and what not to do to live and die. Similarly, ‘education’ is necessary to find out what is market, what is investing, why invest, why invest in stocks, what to do, what not to do, how to select right advisor, how to reject wrong advisor, what question to ask to your advisor and so on. So, now you understand what we mean by investors ‘education’. Yeah!
You will find listing or our very very very important such articles prepared  by text book study, practical live testing, back testing, experience of world’s top successful investors, writing and teaching of world’s top successful investors, and by advisory, portfolio management and personal experience of investing of our in house and freelance fundamental research team.
Education will be provided via webinar, personal phone call discussion, soft copy email files/e-books, spot seminars, group discussion, phone conference calls, and one-to-one discussion apart from the day to day interaction with your own relationship executive at the during the course of your trading about the various topics here.
Please find below the articles. Some have links to our other investors and traders portal, while some articles are provided here below only, while some links will open in this very website. We have tried to provide them in ascending order of ‘knowledge’ and investor needs.
So, go on, be a tiger!
Investor Education is all about how to benefit from investment opportunities without falling into pitfalls. Understanding the right approach/orientation/mindset and adhere to it. Understanding the wrong approach/orientation/mindset and discard it or stay away from it.

Investors don't need to learn ratio analysis, that's our work. But they must know what a ratio analysis is. Investors education doesn't mean teaching you to analyse stock market. It means teaching you and making you aware about the opportunities that markets offer. This will enable you to understand the crucial 'Dos' and 'Don't' of the market which everyone must know. It means developing the right healthy approach towards investing. When you go on board a flight, you don't fly yourself, you are not supposed to fly the plane because you want to reach somewhere, no. But you need to know the manual for safeguarding, you are advised about the rules to be adhered and guidelines. Suppose, if you panic due to noise created by take off or become fearful and panic when you look out from your window from ten thousand feet, you get crazy and faint or puke. Suppose, you think you can ride the plane and suppose, you somehow find the way to cockpit and start tackling the gears! Because you think you know about 'stuff'. Suppose, what if you are carrying a pistol full of bullets? Suppose, it is a small charter you are boarding or you are alone in it.  These example seems extreme. But it is not. It is completely fitting. Suppose, you are not informed about the oxygen mask and a disaster strikes and the oxygen level drops. You are in dire trouble then.
Now, come out of the plane. Suppose, the plane is 'market' or 'investing' or 'trading'. You can co-relate and give analogy. Getting on board with pistol bullets means you are investing with emotions, you get cheerful and optimistic when market rise and blue channel and yellow papers say so, and you get sad or panic when the market falls. You don't know where the oxygen mask is in time of extreme need on board is similar to not knowing what to do in a falling market or when your stock is plunging and portfolio value starts bleeding. If you have education/awareness/understanding/right orientation/right approach/Do's and Don'ts in terms of different situation and important issues of markets/trading/investing then there is no way you can fail. You are bound to succeed. These is what Investor Education is!
  
Our research team has prepared the following topics which must be known to every investors. We are preparing more such topics which will be imparted to Members via modes of pdf e-books, video tutorials, webinars, one to one phone call discussion education, seminar, and hard cover books.

 1.    What is Investment? What are the objectives of Investment? Devastating effect of inflation on your money. Why invest ? Why invest in Stocks ?
2.    The Concept of Compounding Rate of Interest. The Concept of inflation and investment simply explained. The history of returns on investment in Indian and World Stock markets. Why NOT investing in Stock market is Risky?
3.    Classification of Investment based on Duration. Meaning of Short Term, Mid Term, Long Term, and Longer Term investment.
4.    Classification of Asset Classes. Classification across asset classes and Classification within Equities. Ideal asset allocation within equities and across all asset classes.
5.    3 Essential Strategies for Investors.
6.    Portfolio Investing: The key to superior returns in markets.
7.    About Diversification and Concentration in investing.
8.    About Wealth Destruction in Stocks and How to avoid it. Aviation Sector Case study. SKS Micro case study.
9.    The art of making your Stock Investment cost zero.
10. Important things to know about IPOs. Why avoid most of the IPOs?
11. Classification of Money/investible money.
12. Why you must stay INVESTED in markets? The Cost of missing best days in markets.
13. What is Strategy based Advisory vs. Blind Tips.
14. What is Contrarian Investing? How it is useful to you?
15. About market correction and more
16.  Enter before these 10 crore investors & benefit from early bird investment in Indian Equity markets?
17. How handful of people ate cream of Indian Economic Growth and Why it is not their fault?
18. The most common mistakes of investors? Including irony etc…
19.  Why bubbles will continue to create in markets?
20.  How to overcome fear of falling markets?
21.  What is a Stock/Share? What is a Stock market?
22.  What is investing? What is trading? The difference between them.

Oct 12, 2013

9 QUESTIONS TO ASK AND THINGS TO CONSIDER BEFORE SELECTING YOUR ADVISOR

9 QUESTIONS TO ASK AND THINGS TO CONSIDER BEFORE SELECTING YOUR ADVISOR

  1. What risk-reward ratio will you give me?
  2. Please give me 10 investors and traders awareness and educational articles prepared by you.
  3. What is your educational qualification and experience in market of how many years?
  4. Are you providing advice and recommend only to trade or investment also? (one must recommend and suggest about long term investment also)
  5. Will you give me trading calls in segment which I tell you or will you tell me in which segments and sub segments to trade? (advisor must not let client to select their own segment and sub segment, because advisors must know better than clients who are seeking advice which segments and sub segments to trade and which not)
  6. Are you giving free trial or not? (true advisor will not give free trial. Reason is simple. He must be already having enough paid customers and not have time to give free tips. Also such advisor believes ‘free things has no value and quality thing always has value and are costly. He will ask you ‘How can you take judgment of my service in 2 day of sample calls? This is unreasonable’.)
  7. Do you give trades daily or there is no fixed frequency of it? (There should not be any frequency of trading calls giving, every day is not good for trading and no one knows which day will present best opportunity and which day worst. So, there should not be fixed frequency of giving calls.)
  8. What is your accuracy ratio? ( If the advisor says 70% or 90%, beware. Ask him about ‘WHAT NET PROFIT WILL YOU GIVE ME AT THE END OF SO AND SO NUMBER OF TRADES?’ Do not ask about accuracy ratio in %. It doesn’t make any sense and doesn’t give you any idea about accuracy either.)
  9. I have 1 lakh trading capital, what kind of exposure will you give me? (if the advisor say that he will make you trade on full exposure, then beware. A good advisor always cuts 30% from your trading exposure and then gives you positions on the rest of size.)

BEST OF LUCK WITH YOUR HUNT FOR A GOOD ADVISOR!

Oct 6, 2013

14 ATTRIBUTES OF SUCCESSFUL TRADERS

14 ATTRIBUTES OF SUCCESSFUL TRADERS:

1.      View TA as a picture of where traders are lining up to buy and sell
2.      Approach trade no.5 with the same conviction as the previous 4 losing trades
3.      Use naked charts
4.      Comfortable making decisions with incomplete information
5.      Do not think of markets as expensive or cheap
6.      Aggressive with trade size when doing well and modest when not
7.      Realize the market will be open tomorrow
8.      Judge their trading success on anything but money
9.      Study human psychology – Use ful books are- The wisdom of crowds by James Surowiecki, the art of strategy by Avinash Dixt and Barry Nalebuff, Markets Mobs and Mayhem:A modern look at the Madness of Crowds by Robert Menschel, extraordinary popular delusions and the madness of crowds by Charles Mckay.
10.  See themselves as market makers.  Think like a market maker and not just a trader
11.  Practice reading the right side of the chart, not the left.
12.  Always have an edge, don’t trade if you don’t
13.  Determine position size based on risk, not round numbers

14.  Play reaction, not the news

SOME TRADING SUCCESS MANTRAS BY RENOWNED TRADING COACH TODD MITCHEL

SOME TRADING SUCCESS MANTRAS BY RENOWNED TRADING COACH TODD MITCHEL:
Trade for skill, NOT the money=.  If you’re focused on the money aspect of trading…you’re not focused on the ‘trade’.  And SCARED MONEY NEVER WINS!
Concentrate on what you are trade.  Each market has personalities, habits and friends…get to know them all.
Focus on your executions.  Remember, every execution is a trade.  Money is valuable…don’t leave it on the table.
Remember that even the best of the best traders lose money.  Learn to accept your losses and move on to the next trade.  That’s just part of the business – you will NEVER win 100% of the time.
When in Doubt, Get Out (or Stay Out)!!  Deal with reality, if the market doesn’t behave like you expected, Get Out Immediately!
Learn the difference between gambling and trading: (1) Don’t trade just because it’s irrationally high or low, (2) No positions before major market announcements, (3) always use a protective stops,  and(4) always have a high probability trade set-up before putting on a trade.

Anticipate, identify and take full advantage of momentum in the market.

Aug 22, 2013

Jun 12, 2013

What is a Stock or Share? What is a Stock Exchange?

What is a Stock or Share?
A stock or Share can be simply defined as a share or ownership into a business which has been formed under a legal registered company.
It is an ownership part. For example ABC Industries Ltd has 1 lakh equity shares.  Suppose Mr.A owns this shares are the owner of the company and so its profit and loss. 
A share is also known as ‘equity’, ‘stock’, ‘scrip’, ‘counter’ also in stock market parlance.



What is a Stock Exchange?
A stock exchange or Share Market is nothing but a place or platform where companies’ shares are listed (listed means –the company has completed formality so that everyday buy and sale can be allowed of its shares on the stock exchange)
In India there are mainly 2 stock exchanges. One is NSE and another is BSE. Notably BSE is world’s 2nd oldest and Asia’s oldest stock exchange. This shows that Indians were one of the pioneers in investments in the world.

I don’t know much, I don’t have a demat or trading account yet?
No problem. Simply contact us and we will guide you through opening a demat account and trading account and explain you how stock investing works, the important Dos and Don’ts. 

Feb 27, 2012

MAKE YOUR INVESTMENT COST ZERO: Practical Lesson for Investing



Making Investment Cost Zero.

This is interesting. You may think that how it is possible to make investment cost zero. This can be done in reality. When the markets are bottoming out and rising to mark the beginning of the run up, the stock prices rise 20% to more than 120% in few weeks and months time period. This is basically because the stock prices are already ruling at multi months and in many cases multi year lows. The stocks which were in triple digits are now available in double of even single digits! These stocks and even the better ones out of this lot attract a lot of investment and trading attraction.

So the prices rise in a manner as told earlier in this paragraph. Now, when you are entering in markets at an early stage of the price rise cycle,
You get the stocks at good price. Suppose you invested Rs.1 lakh in 10,000 Lanco Infratech shares at Rs.10 and it rose to 20 rapidly then you can offload 50% i.e 5,000 shares and thus get back your original investment amount. So now the rest of 5,000 shares that you hold are absolutely cost less as your original investment capital is out of them. Now whatever monetary benefit as to bonus shares, dividends, or price rise you get is absolutely free is can be measures as ‘infinite return’ on investment, as your investment is practically ‘zero’ in it!

Another way your cost of investment can be zero is to hold blue chip investment for a longer duration. For
e.g. those who are holding reliance industries or grasim or even hind unilever for that matter, for more than 10 years now are indeed holding it for free. Because the price appreciation, dividends and bonus shares etc. in aggregate have given them more than their investment amount.
So, the conclusion is that the advice to pull out sum of initial investment capital after rise in share price can be a general advice to retail and fearful investors.  While the cost of investment long term investment in large cap, blue chips, and value investing stocks automatically becomes zero over the longer term if invested at good valuations.

This concept can be explained in some more ways. Any ways, this concept is one of the very essential practicals that an investor should be aware of.



Jan 4, 2012

Investment classified into 4 on the basis of duration of investment


Now no confusion on what is short term investment and what is medium term and long term!
Read our unique classification of investment based on duration or period of investment.
Plan your investing activity based on our unique classification of investment based on duration of investment.

THE CONCEPT OF SHORT TERM, MEDIUM TERM, LONG TERM AND LONGER TERM INVESTMENTS:

Many (most in fact) investors are confused about equity investments. Main reason being the volatility of markets and the investor’s inability to manage his emotional response to it.           
Other than psychological/behavioral aspects, the investor is also devoid of basic understanding as simple and as basic as ‘what is asset allocation?’ and “what should be called long-term investing and what not?”
Here in this article we have clearly explained the classification of equity investments on the basis of duration of investment. The classification mainly include the

Jan 14, 2011

COMMON AND MUST TO KNOW RULES FOR TRADERS


  • Always have a trading plan. Never trade without a trading plan (a trading plan consists of a trading system which is made of few components)
  • Never trade without a StopLoss (Repeat 10 times).
  • Never ever hold on to a losing position. Never average/add to a losing position. (Repeat this 10 times).
  • Let your profits growing. Add to your winning trades.
  • Trade on Rumors and Exit at news. But

Dec 14, 2010

About correction and more-2


About correction and more-2
(Please click on below link to Read "correction and more -part 1"
http://www.meghainvestments.com/2010/11/about-market-correction-and-more.html
Many investors complained us that we didn’t throw enough light on ‘correction’ thing in our previous post.
Well, let’s start by defining.
To go further into anything which has attributes of understanding we must define it.
What is the meaning of correction?
{
We take it like this. It says ‘correction’ literally meaning ‘something of a process or act of correcting i.e. making it right which is or was hitherto wrong. But when we apply this definition or meaning to word correction and its use in markets, we do not see integrity.
}
{Because the word is used only for declines in prices and it is never used when prices are rising! (This translates that when markets rise after falling on wrong note, it should be called a correction!)}
……This is interesting with respect to how we want to understand the meaning. Mind it. This is not a time pass or ‘intellectual jargon busting’. We believe this whole contemplation will take us through the understanding of markets and its behaviors…….

So when there is any excess of increase in markets, it is ‘incorrect’ and need to decline i.e correct.

Nov 27, 2010

About Market Correction and more

About correction and more-

We were enticed to write this article, by the feeling of amazement the investors were experiencing when they see several stocks making yearly and new lows without making any noise!
They were amazed to see their many of the hi-performer stocks that were analyst favorites and giving them a kick n ride while the hay period of the markets and when it was anything but green on the stock screens.
Correction is a word that is known by all in the market.
You will see any ‘averagely intelligent’ investor saying ‘he will buy in correction’ and that ‘he is waiting’.
But that never happens. Either he jumps at the last movement out of impatience or steers clear by fear of further correction and aversion and pain of notional loss.
Basically, most investors want their stock only to go up from their buy price. Otherwise they will not invest! Or the market is not perfect then!
Why this does happens?
The fact is that they are ignorant and un-knowledgeable. This might sound harsh. But we are not here to please anybody!
Investors simply do not understand when to stay in, when to wait for correction and when to jump in. We will also emphasize the importance of ‘what’ in all these along with ‘how’. Because ‘what’ is what the bottom-line come in the market.
Some of them may know that correction is an opportunity (it is an all-together different subject how to tell a transient correction and a beginning of bear phase. I said ‘beginning’, because as such the bear phase in its form is a boon to investors for a 3 year horizon. We will discuss about it in other article.
So, I believe there are there always a bear phase and correction going on in market! How?
Let’s understand it this way, there are 3 types of correction or bear phases. Any one or more of them is always going on.
  1. For the whole market, which most of us are aware such corrections
The following two might sound unfamiliar to you,
  1. Correction for a particular sector, and
  2. Correction in a particular stock