New day trader. Had some losses.

Hi,

I ve recently completed final yr medicine, I know some fundamental analysis and technicals too, from a long time, but it took me so long to trade coz i had to trade with the money i earnt myself, i cant gamble with parents money, and i am only a day trader. I would never ever invest.

I started off with Rs.20000 in day trading with sbicapsecurities, which allowed me 5X exposure, i.e, 1,00,000.

In the beginning i was careful in making choices so got till Rs.24,000 but now i'm down to Rs.7,000 coz of my rash and perhaps novice decisions.

Can u remember the day ICICI bank flew up recently, a while back? I short selled that day early in morning. lol

Time to review day trading strategies with pros here

Friend, try doing delivery based transactions i.e. you can go for short term delivery period and go for A Group Scrips.

thanks venkateshiyer, but as i said i ve tried delivery trading quite a few times, and i realised that its taking too much time to give reliable profit, and the commission rates r also high.

I'm kinda swing trader, i trade intraday and book profit even for profit as low as 1-2%, and given the volatility in some stocks, there are plenty of opportunities everyday.

The last few days i ve been making profits consecutively every day, i am on a run, though the profits are low.

but as we r given 5 times exposure, it means even 1% change gives 5% profit, only thing is u need to identify the change of trend and quickly ride it.

point to note : Group A scrips suck when it comes to day trading, but are relatively safe, as my experience tells me.

Hi There,

I am alsoa daytrader/scalper, although a rather novice one; but somethign which did strike me from day 1 is that we need the lowest brokerage possible.

In my experience, (which comes through googling and talking to few major brokerage firms) no one is as cheap as www.zerodha.com.

You can check their website and they ask only Rs 20/trade.. for more infromation you can have a look at the link http://www.traderji.com/brokers-trading-platforms/47790-zerodha.html

So, could you share what analysis u do to identify the trend; I generally follow the volatility principle.

Regards
Arshdeep

I have incurred losses whenever i anticipated that a trend reversal wd take place.

For ex, anticipating a fall or rise when on a flat trend, and taking short or long position.

There's too much uncertainity in that.

Recently i am getting good gains by following 'Ride the trend' principle in which we buy when the stock is rising and viceversa.

There's a much greater probability that it continues the same way, but when u see that the graph is reversing, get out of it.

By trend i simply mean whether the stock is sloping upward is flat or downward.

Also, whenever i took a position during market start, say b4 10:00 AM, i always got losses, coz i dont yet know the trend of that stock for that day ( how most ppl think abt the stock for that day )

Recently i am taking positions after 10:30 where we can identify the trend by looking at intraday graph, but have ample time b4 2:00 to square up.

I advise to square up b4 2:00 when in profit, to avoid last minute hassle.

For a nice selection, it has to be on an up or down trend, but not flat.

And good volumes have to be traded by 10:00 itself , i.e, TTQ by 10AM is greater than weekly avg. trading qty which means more ppl are in the stock and there will be movement.

We want movement and not sluggish stocks. Thats what i learnt till now.

to
Arshdeep,

By the way , what is the volatility principle u were talking about?

It is not uncommon for novice traders to lose money, initially. Even when they do, for the most part they are very disappointed, because they have what they feel is the very best method for trading, and they are ready to conquer the world.

You seem to have a good hold on your personal situation, and even winning, albeit minuscule amounts. Having said that, you are already ahead of the game.

As long as I have read you correctly, and I have a good handle on your situation, the next phase to deal with is the mental part of the game. I remember first entering the markets. I had what I thought was the very best method to trade with. Something happened along the way, and that is I bankrupted my account. In trading on my demo, I could make huge gains and think nothing of it, but something happens in the head once live money is put up. The mental part of trading is something you will deal with on a regular basis. The way it is harnessed is by sticking to your methodology and then eventually getting to the point you are totally unemotional in your exits and entries. That should be the goal. Once there, you have scaled the trades' mountain, and on your way to consistent great profits.

Until you reach that point, be patient. Stay within your personal parameters. By what I have read to this point, I think you are going to do real well.

BTW, I trade forex, but the principles I mentioned are still all the same.

Thanks 4xpipcounter,

yup,

The ones i had huge losses were situations in which i had 1-2% profit by 2:00 PM, yet dint book them thinking i'll get more, and ended up incurring loss due to Auto- square off at 2:45 PM

LOL

yup the point is to be satisfied with 1-2% a day and be unemotional. I'm trying to achieve that, being a novice day trader.

I ve already made some progress from Rs.7000 to Rs.7600 by making Rs.200 on 3 consecutive days, now i feel confident a bit.

I've actually stayed away for a few weeks after being bashed from 24k to 7k.

Dunno why, whenever i made a loss and entered another trade on the same to day to make up for it, i again lost the next trade.

That also counts into the emotional part i think.

Any more suggestions or trading strategies?

Thank you.

Your real confidence will come with the experience. When I first started trading, I was buoyed tremendously by making a few really good trades. Just as quick as I was up after making some good ones, I was down after some bad ones.
Real confidence came after several days, weeks, and even months of constant repetition, and watching my account grow on a consistent basis. At your level, enjoy the high times, but be aware to deal with the low times. Eventually you will be at the point that you have the identical mindset when you lose or win you have a big winning trade. You will enter a zone where making trades is just a part of business. The confidence is in knowing your methodology and margin practices are the principles and the foundation of why your account keeps growing.
Don't worry or be too encumbered over how much you earn on a daily basis. Your goal should be to just develop consistency. The earnings will just fall in place. Even though I am an excellent trader, I still have to shut those things out on a regular basis. Just the other day I made 30%. That feels good! I would like to keep it up. The focus still needs to be to just show up at work and do my job.
Most of the time, the mindset when someone places a trade right after a losing one is to make up for the previous losing one. Wrong way to think! If you find yourself thinking that way, then take the 1st losing trade, shut the computer down, and walk away. Your equity is less than when you started the day, but big deal! That happens. That is business.
The flip side is getting over-confident. You make 3 straight winning trades, gain 10% on your account, and now you ("You" is a figure of speech. Not necessarily referring to YOU.) believe you are indestructible. That thinking will hurt the trader just as much as feeling they need to get back at the market.
The hardest part of trading that you will develop is the intangible part, and that is that mental part. It takes patience. It takes patience being willing to watch your account grow $50 per week (Just an example.), because you want $20,000 week RIGHT NOW!
There is a reward in patience. This is the one thing I hope you gain from all this. If you take the 7K you have now, be patient, and you were only able to make 1/2% per day, you will be a millionaire in a little over 2 years. I understand perfectly we all need to be rewarded for our efforts, and so I'm almost certain you will be pulling some winnings long before you make 1M, but you get the picture.
Here's another way to look at it, and it is practical. Take the 7K, grow it 1/2% per day, then withdraw 25% of your winnings each month, you are a millionaire in 33 months.
Having said that, I did say don't make goals. Just aim for consistency. Just by doing that, 1/2% will become a walk in the park to you.

As far as trading strategies go, that has to be personal. You can learn and gather ideas from other traders, but the final culmination of your methodology will be exactly what is right for "chaitu". I can't tell you to scalp, daytrade, or position trade. I can't tell you what to trade. This is because our trading has to be catered to our makeup. I believe my methodology is the best there ever was. BUT...that is not a fact. That is my confidence speaking, and no one could ever convince me to trade different than I do. In the previous paragraph, I mentioned the core principles. Those are the absolutes. Your methodology is the thing that is personal.