My Trading Journal

Hi all,

I am Raj, I am maintaining this journal as a record of my trades and the reason for entering or exiting a scrip. I have a starting capital of Rs.37854.00. I am trying to earn maximum returns on my investments through purely cash trading as I have found intra-day or margin trading to carry an unreasonable amount of risk. In future when I have a larger capital I will trade in F & O. I would be delighted if anybody wants to share any ideas or suggestions

: My Trading Journal

Market outlook: I am currently pessimistic about markets as I use RSI as a benchmark to check the current market sentiment. On it there was a double bottom created last month. Hence I feel markets will be sideways at best or negative for a month or two. Beginning with 7900 would be crucial on Nifty. If it holds, then for reversal from this position would. i.e. bearish to bullish, be confirmed when Nifty rises above 8300.

Hence I am maintaining my cash position. I have purchased Reliance Liquidity Fund Daily Dividend today for Rs.23000.

Let's see how it works.

Thanks and regards
Raj Sheth

Raj all the best....

so u have invested in Mutual fund ... good good..
Reliance liquidity fund daily dividend ... has given avg return of 9% yoy...

at least 15% return u should get yearly basis...

all the best....

Dear all,

Thank you for following this thread. Since there is not much trading or analysis to be made. I feel this is a perfect time to recapitulate my experience with the market and trading as a whole. I don't expect my views to be totally correct But I feel I owe it to all to share my embrassingly short 'knowledge' about technical analysis in particular and trading in general.

Trading: An art

Rationality and planning have no relation with each other. When we plan we try to take into account every factor that we can think about. Based on which a decision is made. After acting it out we became aware about various 'other' sets of factors that we did not consider; or did not think they were that important. In the light of this discovery we find that the decision we made was irrational, this situation arises more particularly in financial decisions.

Through the above process many of us learn trading. Even after years we find to our dismay that we were unable to avert bad trades or close a good position too early. There is no guarantee that even after learning this shortcoming in anticipation we still stumble around the market like blind men. We cannot avoid this process. But there is a solution to minimize this hindrance. It is called management.

Management is process of handling things or people; in this case situation. This process is initiated by acting out certain sets of principles that guide us and provide alternative course of action.

Example.
Here are my principles borrowed heavily from William F Eng's book Technical Analysis of Stocks, Bonds and Futures.

1.Always have a fixed stop loss. He suggested 8℅. A scrip(or a trade) which has gone down 8% rarely turns around.
2. Investment decision have to be made objectively. It is not an ego satisfying exercise. Trading successfully/ unsuccessfully does not prove anything personally. It is just a simple act of buying and selling. Many have done it before and countless million would do it after you. It is not an invention.
3. To spread the risk do not make lump sum investment.
Try to invest in multiple stock.
4. Do commit any money that you can't afford to lose.
5. Do NOT take loan to trade in securities market.
6. Avoid any attempt to 'time' the market. Set a regular investment plans.
7. Set an achievable goal based on rigorous research
8. All the methods or tools that you plan to use make decisions should be thoroughly understood and tested before making decision based on them.
9. Try to take a long term view of investment as in the long run markets beat other asset classes. But in short term it could be risky.

Once again thank you so much for giving your time. Suggestions and feedbacks are most welcome.

Trading: An art
10. Be flexible

Now I will take a look at the decision and relevant factors. While trading we make decisions like what to buy; hold; sell, or even when not to trade. The last decision really makes the difference between success and failure.