swingtrader said:
Pravin,
Can you give few more examples which led you to the conclusion that you are getting a raw deal from Ashwini Gujral? The example you gave doesn't support this argument. According to my analysis PBA INFRA is in a good position until it breaks below the support level around 150, if the market stays supportive it could actually breakout to new highs after this slight pullback. After you bought it at 177 it has only had a small pullback. I am not sure how this particular example indicates that all of Ashwini's tips are bad.
This is just my opinion. I am not endorsing Ashwini Gujral's tips, I have no idea about the sort of tips he gives. I firmly believe that nobody can predict anything in the market, not Ashwini Gujral nor any other person giving you tips. Trading is all about probabilities, you take a sensible strategy (even a moving averages crossover strategy will do) and take all trades it gives. You win some & lose some and if your stop loss mgmt & position sizing is good you wll come out ahead. Since you have no idea if he is using single or multiple strategies for the tips, all you can do is make sure your position sizing & stop loss mgmt are good. You might want to relook at your position sizing strategy, smaller size would have allowed you to withstand the small pullback in PBA INFRA and you would probably have not felt like this.
When you got the PBA INFRA tip, you should have seen that the nearest support around 150. So if you select 149 as the stop your risk would have been 177 - 149 = Rs. 28 multiplied by number of shares you bought. If you would have gone thru' this computation you would have known if you were capable of withstanding this loss. If you were not prepared to accept this loss when you initiated the trade then you had no business to be in the trade. When trading, before you enter the trade, be ready to accept the risk. If you had not thought all this and just blindly too the tip then I cannot say anything more.
These forums here have wealth of information buried inside, search and learn some more on how to manage risk and that will train you to not even be in such a position as you are in right now.
I hope you don't get angry and blast me, the above is just my humble opinion. I can understand your hurt but when trading on tips you still need to do lot of homework from your side.
--SwingTrader
It was such a nice explanation swingtrader, I liked it very much. To add a little to what u have said:
In Trading, u can't predict the price its only probable (chances of winning) to be high. When someone recommends a stock then also it is not 100% sure that it will go up, he had seen a probable movement (based on charts) and expecting to be higher.
So in every trade the winning and loosing is always possible. Now we need to pick a trade that has high chances of winning i.e. with right time entry and right time exit.
The concept of price stop is so important that if one dont follow it then he will end up loosing everything. I really have gone through that and learned.
Take an example 7 out of 10 picks u win (If u pick nicely
.
Example - Take a pick with entry as 100. You kept ur stoploss(support level) as 80. And the target for the stock depends on the momentum (Price and Volume) and u fixed short term targets like 130, 160 and 200 (Resistances)
Now when u reached 130 keep ur stop trailing upwards as long as the trend continues and when u see the trend reverses and touched ur stop loss then exit the trade.
Imagine it touched 180 and ur stop loss trailed to 155. And some reason ur stock coming down and touched ur stop loss (Determines the reverse of trend) then exit the trade. (Please dont think that I could have made more money If I would have sold at 180 because we dont know that stock is going to up or not but we are just following the trend)
Now ur trade can be a win or a loss. Chances are 70:30. If its a win then u gain 55 and if u loose its 20. If u dont have stop loss dont even think about it, u can loose 100 also
Overall if u calculate in such a way and out of ur 10 trades you can 85% profits and 15% losses with the concept of stop losses in place. I put up percentages to make it more understandable but nothing relative.
7:3 ratio is just meant to be good picks. Since u r in traderji, it would be definately 8:2 but pls take care to follow the right time entry, right time exit and trailing stop upwards.
The disadvantages of not having a proper stop loss are u can end up loosing everything, significantly waiting for a time that will come up, loosing ur sleeps etc. Imagine if u dont have a stop losses for any trades existing, look for a trend that continues and get out of rally without thinking about the profits.
This is my 100th post, I thought I could share some valuable information. Hope I did so.
Regards
Raj
