My Day Trading Dairy.

imfine

Well-Known Member
Hi friends

Today have taken entry in Jetairways

buy 348.10
Sell TGT1 354.10 TGT2 359.75
SL 342.60
 

augubhai

Well-Known Member
The only clarity i have now is that i have to repeat that 300% return. If it has happened once it can happen twice thrice and in future also.

So thats why

I restarted.
:)
Hi,

I have seen a few of your charts. I like your trades. It's great that you might have the knack of getting the trades right. Maybe, your risk-reward for individual trades is good, and maybe your win rate is also good - all this maybe giving you a net positive expectancy system.

But your focus on the 300% return sounds alarming to me. All traders have this bravado of trading, but the aim should be to be brave without being dead. Even if you are a good trader and have a net positive expectancy system, you still need to get the money management right. If your money management is not right, and you take positions that much higher than your optimum position size, you will ruin yourself. Yes, you will have those 300% or even 1000% winning streaks, but drawdowns will hit you severely. This has happened multiple times to me (for example this link), before I focused on money management. In fact, with the kind of leverages that we get from the brokers, it is easy to earn 100% or more in a day even with futures.

Please read the below post from @headstrong007. He is talking about building up a buffer to enable taking higher risk-reward trades. While aiming to keep your adrenaline high, also aim to keep your net worth high.

The easiest process of burning out the whole capital is trying to compound capital without knowing the psycholigical limit of handling maximum capital at a time. You always need to shift some profit for backup in a way that, even if 100% capital is lost you can fill it. If u know u can fill it, u have greatest psychological advantage of tension free trading. Then you can go for higher risk and higher return trades and you can wait for long to run on profit patiently. Smart money management never favour such compounding bcoz u always need to shift part of profit for backup caiptal, as soon as you increase the capital for trading. Remember this always. This is the way a pro trader cut the risk. :)

There is no risk in my trading, you know why? Bcoz even if I lost 100% capital, I can fill it next day. I am confident I can get back it soon. When we are trading, we must remember we are using leverage so actual turnover is much much higher. We can't compound it so easily bcoz we need to save backup. All big pro traders are using only a part of capital for trading, they can refill it multiple times if they required(although they know they don't require in real life). There is min risk due to their money management.
 

Similar threads