Day Trading Stocks & Futures

[TraderRavi]

re: Day trading Nifty & Stock Futures

BASIC TYPE OF STOP-LOSS EXITS

1. Initial stop.
First stop set at the beginning of your trade.
This stop is identified before you enter the market.
The initial stop is also used to calculate your position size.
It is the largest loss you will take in the current trade

2. Trailing stop.
Develops as the market develops. This stop enables you to lock in profit as the market moves in your favor.
We exit the market when the market goes against us and our stop is hit.

3. Trend line stop.
Use a trend line placed under the lows in an uptrend or on top of the highs in a downtrend. You want to get out when prices close on the opposite side of the trend line

MOVING STOPS
Never move your stop for emotional reasons, especially when it is your initial stop .
As new trailing stops are determined, you can move your stops to lock in profit.
If you add on to your winning trade (increase your trade size), your stop must be adjusted to keep your risk in relation to your new trade size.

kaam aayega

 

[TraderRavi]

re: Day trading Nifty & Stock Futures

Ali, focus of money mgmt is - SURVIVAL. As a trader, we can survive to fight the battle on next day, only when we control the amount that we are going to loose.
We got to set the rules and follow.. (if we don't have the rules, then there is no question of following them). It is not just matter of knowing this number in our head.. but I prefer to keep it in writing so where and also refer to them regularly and monitor them during the market hours.

In my trading, I have various loss limits as % of my trading account size.. i.e.

- Risk per trade 1%,
- Risk per day - 4%,
- Risk per Week - 8%,
- Risk per month - 10%.

At the start of month I calculate these number and then they are reset only on next month begining.

You can have different % here. But higher the number, difficult it gets to recover the loss. In my approach even if I am down 10% in a month, I can easily recover in next month.. but if I am down 30% in a month (i.e from 100, i have come down to 70), then I will need a RoR of 45 to 50% to recover.. which is not practical in a month. So, I keep fighting for 2/3 months just to get back my loss.. Not a good trading loop where I want to be in.

The Must rule for me is to stop trading for as soon as any of the loss limit is hit.
If I have 4 loosing trades in a day, my trading day is over. If I have 1 4% lossing day, and next day again I loose 4 trades, I am on holiday for a week. No more trading, no fighting with mkt to recover my loss.. Psychological impact of losses on our decision making is very different topic.

Plz read something more on this topic and feel free to raise your doubt/query.

Hope this helps.
Happy Trading

risk & MM

 

[TraderRavi]

re: Day trading Nifty & Stock Futures

Hello Ali,

Sorry to hear that you are going through a loosing streak at present but every trader goes through it periodically....so no need to feel bad....winning and loosing is a part of a game called trading....as long as you keep your winnings large and loosings small you are going to be a winner. And this is where MM comes into play..to restrict your losses when trade goes against you.

I follow following MM rules in my trading :

1) The initial risk in any trade should not exceed 1% of the trading capital...with adds it should not exceed 1.5 %

2) Max risk at any point on all open daytrading positions should not exceed 3%

I will also suggest the following to follow in the loosing streak :

1) Trade small till you get on the winning streak and get back your confidence because loosing streak not only dents your trading account but it dents your confidence,clarity of thoughts,judgement etc

2) You must learn to hold on to your positions when they are going in your favour...also add to your profitable positions...this is the key to trading profits....no amount of brilliant thinking will do that for you ....it is your adding and sitting with profitable positions which will make enough money in your succesful trades much more than your losses in loosing trades....and this applies to daytrading as well you can have 2-3 profitable adds during the day.

3) Wait for proper set ups to develop before you take a trade...this is particularly necessary in loosing streaks..

I am sure you will get out of this loosing streak and get on to rocking streak soon. Look at it from positive perspective that after this loosing streak,the winning period is round the corner....so cheer up and go for it...

Best wishes,

Smart_trade

risk and MM

 

[vijkris]

re: Day trading Nifty & Stock Futures

kaam aayega

Kuch months pehle likha hua post ko aaj yahan pe jagah mila hai. :clap: :clapping:

Chalo acha hai, sabka saath sabka vikaas.

All the best. :thumb:

 

[TraderRavi]

re: Day trading Nifty & Stock Futures

notice the difference in charges for same quantity in equity and Futures
1 Lot Tatasteel 2000 Q.
Equity segment charges vs Futures charges.
STT in EQ is very high , transaction charges also high.

 

[TraderRavi]

re: Day trading Nifty & Stock Futures

spoof orders by operators (which aren't meant to get executed - just used to scare)
on friday morning tatasteel fell to 416/17 then it tried to go up , generally orders in TS are 2000 to 6000 /10000 ie 5 lots. but then a order apperared on sell side of 94000 Q which is huge , only to scare people and then disappered , price jumped many points after that. obviously it was to fool people that with such huge selling price going to fall :annoyed:

 

[vijkris]

re: Day trading Nifty & Stock Futures

notice the difference in charges for same quantity in equity and Futures
1 Lot Tatasteel 2000 Q.
Equity segment charges vs Futures charges.
STT in EQ is very high , transaction charges also high.

Yes true tax is high in eq.

As a simple calculation assuming 0.01% brokerage, i just fixed approx charges of 35 rs per lakh turnover.
Whereas for futures it is 25 rs per lakh turnover.

 

[TraderRavi]

re: Day trading Nifty & Stock Futures

Ab giri ye nifty ,
chalo jo thoda bahut subah mila wohi sahi
Waise bhi bakwas trading this week , especially exits ������������

Sent from my SM-G7102 using Tapatalk

out of 5 days , 3 ended in red, and so week in red.
one of the mistakes commited is leaving profit on the table.
a long on BNF was giving 60 points but it refused to move above 18150 , but as it was attempting multiple times to break it so I thought it will break it and I shall recover my previous loss in it, but in my mind I knew that it is failing to break it and retracing back everytime price reaches near it , but hope wins over logic and I got only 5 points in it for brokerage etc.
the reason for this behaviour was loss of 70 + 40 points in BNF on 1st january , that played on my mind and I tried to recover it instead of whatever I was getting from a particular trade , when you do not book profits in winning trades then losing trades piled up losses , so pressure increased in coming days as few NF trades also failed , then similarly 3 trades in TM/TS good profit not booked in hopes of getting bigger profits to cover losses and then whipsaw.
I found out that in these 4 trades if I had booked profits , the week would have been in good profit.
so for next week the plan is to trade with fresh mind and do not affect with what happened in previous week.

 

[monkeybusiness]

re: Day trading Nifty & Stock Futures

I shall recover my previous loss in it, but in my mind I knew that it is failing to break it and retracing back everytime price reaches near it , but hope wins over logic

Ravibhai,

I am also going through the same phase, to recover previous loses from winning trade, I manage to screw that winning trade into a lossa trade. Greed seems to be my nemesis.

 

[vijkris]

re: Day trading Nifty & Stock Futures

out of 5 days , 3 ended in red, and so week in red.
one of the mistakes commited is leaving profit on the table.
a long on BNF was giving 60 points but it refused to move above 18150 , but as it was attempting multiple times to break it so I thought it will break it and I shall recover my previous loss in it, but in my mind I knew that it is failing to break it and retracing back everytime price reaches near it , but hope wins over logic and I got only 5 points in it for brokerage etc.
the reason for this behaviour was loss of 70 + 40 points in BNF on 1st january , that played on my mind and I tried to recover it instead of whatever I was getting from a particular trade , when you do not book profits in winning trades then losing trades piled up losses , so pressure increased in coming days as few NF trades also failed , then similarly 3 trades in TM/TS good profit not booked in hopes of getting bigger profits to cover losses and then whipsaw.
I found out that in these 4 trades if I had booked profits , the week would have been in good profit.
so for next week the plan is to trade with fresh mind and do not affect with what happened in previous week.

Ravibhai,

I am also going through the same phase, to recover previous loses from winning trade, I manage to screw that winning trade into a lossa trade. Greed seems to be my nemesis.

Atleast you people are attempting to trade next day with the hope of recovering previous losses. :thumb:
After big loss i do not have enough courage to open terminal next day. :lol: :annoyed: