Come into the Trader's Den

[whyLately]

To break the ice, here comes the first question from me - to all of you.

I want to improve my trading.. and want to set just 1 goal for April month. By end of April, I want to crack this problem.
What should it be ? and more important how to implement it ?
Any idea /suggestion/help ?

If I've understood this right, here is one of the things that I would have taken up if I had time ...

What one misses is known price curves against which to watch indicator behavior or test hypotheses. Examples of such curves are:
- Sine curve, composite sine curve (sum of two frequencies/amplitudes), elliot curve, saw tooths, (maybe even) known random walks
- above curves superimposed on a trend line, or between channel lines
- above curves with random shifts / gaps, etc
(no volume info; not aware of any way to do so)

The need for known curves has often arisen. Given a chart, what should be the parameters of an indicator or what parameters enhance or muffle divergence? Does this pattern occur more frequently at major tops or minor pivot highs? Testing exceptions such as does the afl value not settle to zero when price are flat? The other day I was reading about Parson's Magic Reversal technique and it would have been most straight-forward to test it on a known price curve before taking it further but, surprising, this is not available (or I do not know where to get such).

Generating known price curves is perhaps doable in Excel. But I would prefer an application that can generate the data for import into charting software of choice.

As to how to do so ... guess the basic curve need no elaboration. Elliot generation not sure. Randomization has a lot written about:
- Coin Tosses and Stock Price Charts
- A Multifractal Walk Down Wall Street
- Geometric random walk model
But I would not get too involved with randomization without funding

Again, throwing an idea if this is what was intended. (And as someone once said: Most of us have ten good ideas before breakfast; a good manager knows the nine & half to shoot down).

 

[AW10]

...........I would like to ask here what is it thats keep motivationg all of (besides money) sucessful traders ?

pchartis, if you observe the successful professionals in any field - sports/corporates/music and trading as well... you will find a common factor that they are committed to their passion. They excel in their passion. And money just follows as by product.
The factor that motivates each of us differ from person to person. It depends on what we value most and what we enjoy most. Most of the time, it is people in our life, freedom of time and freedom of money to do the things that we really want to do.

We always give excuse that we don't have time or money.. and wait for that dream day when we can give time to those valueable thing/personal passion.
We hardly try to find the way out to fix the problem and break this rat race.
But to me it is more of putting your happiness at the mercy of future. Why don't we face upfront and start being happy from right now...or atleast take small steps so that in next 2 or 3 years time we can be more happy.

I can only share my approach here. Ofcourse, my family and friend are on top of the list.. but I am also passionate about learning and sharing, and helping less privilaged one. By doing 9am to 9pm job, I will never be able to get satisfaction on these points. I will never have flexibility of time. Hence I explored the options and found that trading could help in solving my time and money related constraints and give me the freedom that I want. So for me, trading is a mean to my bigger goals.. It is not my full time job. Ofcourse I enjoy trading and it is my passion so can't stay away from it.

Ofcourse, once I have that flexibility, then I can decide to do what I want. I may still decide to do full time trading, or take up a corporate job but that will be my choice. Not by compulsion as I don't have anyother option.

By keeping this in mind, I have adopted my trading as well. If I need the time, then I can't daytrade hence I got to master swing/higher TF trading and option trading fits pretty well with those goals.

Think about what would u do if you have got all the money, all the materlistic possesion and all the time of the world. Very soon, you will get the answer of What are your drivers.

Hope this helps in clearing the confusion.

how do they cope time management as besides trading one has to learn from various sources like net,books etc along with their personal commitments.
I found time management very difficult as i always lacks it when it comes to trading & learning
Do share your views and experineces

Time mgmt is universal skill that we need. Core of this subject is to organise the clutter in some sort of masterlist.. and then prioritize the to-do items. Each item should be do-able in 30 mins to 60 min time..and just focus on completing them. If item takes longer time, then break it down into smaller items. 30 mins task look manageble to most of us and most of us can easily concentrate for 30 mins and get over it. But if task takes longer, then our subcounscious mind konws it well and keeps giving us enough execuses to push it for next day..typical procrastination.

That is big topic on its own.. lets discuss it sometime later.

Have enjoyable trading

 

[AW10]

As always very lucidly write up by you. how manage to explain in such a lucid way.

And of course I remembered setting loss limits but reserved your advice for future use as I have kept my capital very low.

well I agree too wth Swamy's suggestionand next 3 days is holiday I will keep away my mind from market and trading . only relaxation and meditation .

From monday I will keep my number of trades very low and rest of trades will
be paper trades.

Will try lots paper trades. lets see what happens.

Will be reporting next week .....

Sunny, better to treat all money with same respect. If you don't inculcate right habits now (your mind will learn the wrong things.. and I am sure you know it well that how easy it is to learn wrong thing).. And later on you will spend extra time/energy /money to unlearn them.

If you have small account, you can still follow risk mgmt/money mgmt fundamentals. Later on as account grows, it will be just matter of changing the multiplying factors... You would become master of these rules by the time your accout grows..

And when u take off from market, it should be no trading when mkt is on..If mkt is closed, or you have other demanding task, that should not qualify as trading break.

just my views.

 

[AW10]

Can we really make good money trading?

If so, is it a concentration of full time or part time?

Since I am already making a profit of around 15-20% from my business, will I be able to come close to that by trading.

I also think now learning(investing lot of time), is it worth.....later.....for a slow and steady income.......

tvrssvk, as I have mentioned in my prev posts... money is byproduct of good trading. so if one is exhibiting right trading practices, I don't see any reason why money can't be made. In fact, that will bring consistency in +ive returns.
Without right practices, some people are lucky for certain period of type (specially the bull mkt) and they make money.. but eventually most of them end up giving it back to market.

There are various approach of trading. I know people who make 6 to 8 trades a month, and make living from tradign (ofcourse their trading account is big).
There are other people who trade just the 1st hour after mkt open and they are done for the day. (ofcourse they have spend time to reach this stage).
One can't afford a lifestyle costing 1 Lac rs a month, with 50k account.
It is matter of knowing one's constraints and finding right trading system to meet one's requirement.

One of the beauty of trading business is that it is easily scalable. If one is consistent in making say 5% return on 50k account. Getting 5% on 5Lac account is not difficult(ofcourse there will be some psychological challanges but that can be handled). Within 1 to 2 months time, your return goes up by 10 times. This buss has readymade market available everyday, it doesn't go thru recession or there are no competition..
I don't think, any other buss will give this kind of advantages when it comes to growth. Being a business person, you might know the kind of challanges you will face to just double your business. But that is not case here.

Just some more of my thoughts.
Have enjoyable trading

 

[Engineer]

Dear Friends,
I am new to trading and welcome all advice.
I dont know how I can use STOP-LOSS to protect by investments already purchased & in my demat acount. Do I have to put a stop loss every morning ? Or I can put a stop-loss once for all ?

 

[Placebo]

Aw10 Thanks for starting such a wonderful thread. Your experience in this field and passion is quite clearly reflected in your posts and the fact that you try to help people. Keep up the good work mate.

Cheers And Happy Trading

 

[veluri1967]

A good place to discuss ATM (Any Theme Matters) of course quite related to trading.

Congratulations to AW-10 for this wonderful initiative.

When seniors said one should have a proper money management, i never thought of it until & unless I had a series of loosing trades and a fast depletion of my trading account. Just two trading days wiped out my entire earnings plus 10% drawdown in a/c.

As a new trader, one will experience a streak of winning trades thus making him to build false confidence in his trading skills.

I used breakouts at my earlier trading days, and it was galla time for me as my a/c was growing +ve without much drawdowns. It all started when the breakouts failed and whipsawed and that hit me hard and my a/c depleted even before I could understand what was happening.

AW-10's signature then made me realise what I was missing in my trading journey. His advices to new traders like me is a light house to where we should set sail to reach our goals.

My initial lessons were 1) have a plan - which i did not have 2) trade your plan - how could this be possible without a plan.

Plan your trade. It should be based on practical backtesting of the plan at different conditions of the market ie trending, non-trending.

Trade your plan. Once had a definite plan, implement it vigorously. Setting goals realistically and implementing them without greed and fear make your plan work.

As well said, the profits should come as a side effect of good trading practices, but not targeting them.

I once again congratulate AW-10 on this good initiate.

I wish members should make use of this thread to their betterment in trading.

 

[AW10]

Veluri, you are not alone to have this type of experience in equity curve.
Late is always better then never. And market is not going anywhere. It will throw enough opportunities to you.. just stay in the game for long enough and practice right trading .. You will start seeing the reversal of curve again.

I had gone thru similar phase as well... recovery was tough till someone showed me the right path.. I guess, some of us need that first hand experience to realise.. some are fortunate to learn from others mistake or reading.

All the best.

 

[AW10]

Dear Friends,
I am new to trading and welcome all advice.
I dont know how I can use STOP-LOSS to protect by investments already purchased & in my demat acount. Do I have to put a stop loss every morning ? Or I can put a stop-loss once for all ?

Engineer, yes you need to put stop-loss everyday. In our market, max life of an order is 1 day.

I am assuming that u are positional trader.
I can suggest some slightly easier approach - to use the alert facility of the your brokers trading platform or any other place.

There is somethign called ATR = which approximately gives idea about average price the stock is expected to move in a day. So for all your stock holding
1) Find out the ATR for each of them
2) Find out the target booking price level or stoploss level for each of them where u want to action.
3) Set trigger for 2*ATR or 2.5*ATR from those level .
In this way when price reach near your price level, you willl get alert. And then u can go and place stoploss order.

Take example, u bought a stock at 60, and it has ATR of 3. i.e. on average price moves by 3 rs every day. You want to cut the loss if it reaches 50, or want to book profit when it is reaching 75.
So 2*ATR gives you = 6 rs. So put a alert for price reaching 50+6 = 56 level so that u can go back and place stoploss order. Or set alert for 75-6 = 69 level so that u can put profit booking order.

If alerts are not triggered, you enjoy the life and let stock bounce here and there. Hope this helps.

 

[SwingKing]

Hi all,
now a days all my trades are going in loss. Whatever i do i am making losses.
Dont understand wht the hack is happening. Anyone had similar experiance plz share and advice. Frustrated from past two days of heavy losses.

You need to chill out Sunny. Loss is an alias for Trading.

Take your girl out for a nice drive. That's gonna take away all your stress. :lol:

That's what I do.