Day Trading Stocks & Futures

I Trade with FINVASIA.

I am basically a scalper not holding for more than minutes,but after analysing my trade logs i figure out that if i mange to hold my winning position for more time(Say hours),i may make a fortune in a day.

I started doing the same from last weeks ,but there was no long trend and they mostly reversed (i understand there was bull run,but they were not quick enough to benefit in options) making my small gain into big loss.

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Fine, so your cost of trade is minimal. How much of your trading capital do you keep in the account and how much in the bank ? Make a point to keep only 10-15000 in the trading account.
 
I Trade with FINVASIA.

I am basically a scalper not holding for more than minutes,but after analysing my trade logs i figure out that if i mange to hold my winning position for more time(Say hours),i may make a fortune in a day.

I started doing the same from last weeks ,but there was no long trend and they mostly reversed (i understand there was bull run,but they were not quick enough to benefit in options) making my small gain into big loss.

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1) Costs are high. From my perspective, scalping is probably very tough and not worth it but that's just my view without real experience. But holding for longer periods can work.

2) You cannot just change a plan looking at recent behaviour and then go live like that ( or atleast that too should be part of plan and tested as much as possible). Backtesting may not be perfect but it is a good way of checking if your plan might work and what are the returns and dds.

3) Fortunes are not made in a day like that in trading in any sustainable way. That is gambling. But vv is not true, you can lose a fortune quickly.
 

sridhga

Well-Known Member
Last 2 days was pretty messed up and bad for me as i lost 40 % of my capital in index options,i do intraday .
I have been trading fulltime from almost 3 years now and still not able to break even.
Everytime i feel like i understand the game now,big drawdown happens like this happens.
Not sure how to deal with it as i am very tired and have started feeling to give up now.



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What is your trading plan? What are the entry rules? Exit rules? Risk management rules? If you can provide details, someone can possibly suggest improvement.
 
What is your trading plan? What are the entry rules? Exit rules? Risk management rules? If you can provide details, someone can possibly suggest improvement.
My strategy is very simple.
I wait for the Breakout (or mini Breakout)to happen,i check the movement strength after breakout (with help of volume indicators) and then take decision to enter or not,if position is working after entry i will keep it open till it retraces,if not working i exit at mkt price(loss points depends on volatility).
What happened Recently is i had few bad trades and each loss cost me near 1k per lot due to volatility,resulting into big loss for a day.

I understand that one should make a rule of max loss cap but i knowingly refrained from it as i had got away with it in past(like been down 5 k for a day but recovering it back at end of day),My Mistake.


I never drag my loss much on single trades as i am aware of risk management,but things didn't went well for many days accumulating my losses.

I believe i have been thinking a lot today of recovering my loss and that lead to more loss.




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Market has uncanny ability to make traders believe in wrong trading practices.So few times you dont cut your loss and the market after a big loss comes back and the losing position goes into profit so trader starts believing that puting a stoploss is not a right thing ,it is unnecessary....and on few days the market dishes out large crippling loss.This is what has happened to you.

From the above description I get a feeling that you are over trading and taking too many contracts position in relation to your trading capital and when the position goes into loss ,due to large volatility your loss increases and you freeze......if volatility has increased, you need to reduce your lots or keep very strict stoploss....

You have to eliminate these mistakes from your trading yourself.Other people can only point at possible reasons/solutions.

These mistakes are not acceptable after 3 years of full time trading.....so correct yourself quickly.......make sure that you have no large loss day in any month hereafter.

Smart_trade
 

sridhga

Well-Known Member
You said you trade options. You also said that you lost 40% of your trading capital in 2 days. Further you lost 1K per trade.

I do not know if you trade Bank Nifty or Nifty. Let me discuss from Nifty perspective. I do not know your time frame. I do not know if your system has positive expectancy. I do not know how many trades you do per day. I do not know if you buy or sell options. I also do not know if you trade monthlies or weeklies.

Nifty underlying is at 14600 approximately. Nifty January Futures are at 14630. Options are valued based on futures except for on the expiry day. But for convenience let us say Nifty is at 14600. Now, one lot of Nifty has 75 shares. So, 14600 times 75 is 10.95 Lacs. or close to 11 Lakhs. If we are trading in nifty lot, we are trading a product that has the value of 11 lakhs. Last few days, Nifty has quickly moved 100 points intra-day. Some times more than that. Even 1% movement is now Rs. 11,000. How much of an adverse movement can your account tolerate? You may be buying options and so you may feel that 11 lakhs is not relevant for you. But options purchase is merely seeking a premium of the that amount one can lose completely, especially if you are dealing with weekly options. In weekly options a position can lose its value fast if it becomes OTM.

If you are buying Bank Nifty weekly options, 1% adverse movement in Bank nifty can make ATM option quickly into OTM and the option can lose value beyond redemption in matter of minutes.

Even if everything goes right with options, IV changes can create havoc in trades.
Have you considered these points in structuring your trade strategy?

I do not know if you trade a specific set up which repeats often. If so, with experience, you could handle that specific occurrence. This approach could also limit the number of trades per day/week etc.

I hope this helps. If this does not make sense, please ignore.
 

travi

Well-Known Member
My strategy is very simple.
I wait for the Breakout (or mini Breakout)to happen,i check the movement strength after breakout (with help of volume indicators) and then take decision to enter or not,if position is working after entry i will keep it open till it retraces,if not working i exit at mkt price(loss points depends on volatility).
What happened Recently is i had few bad trades and each loss cost me near 1k per lot due to volatility,resulting into big loss for a day.

I understand that one should make a rule of max loss cap but i knowingly refrained from it as i had got away with it in past(like been down 5 k for a day but recovering it back at end of day),My Mistake.


I never drag my loss much on single trades as i am aware of risk management,but things didn't went well for many days accumulating my losses.

I believe i have been thinking a lot today of recovering my loss and that lead to more loss.




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Are you in a habit of averaging losing positions instead of cutting short( a pre-determined fix SL ) and accepting that trade is a loser?
bcos that is how losses spiral out of control and as posted above, habit of waiting for mkt to become favourable and thinking it will happen everytime.
 
When the Vix is above 20, the options tend to get wiped out in a whipsaw, when the vix is below 20, the options only seem to lose premium. So, intraday option trading is a very tough game.
 

travi

Well-Known Member
When the Vix is above 20, the options tend to get wiped out in a whipsaw, when the vix is below 20, the options only seem to lose premium. So, intraday option trading is a very tough game.
very tough indeed :DD

some ppl are in/out managing trade very frequently and probably like it. I prefer taking a trade and sitting back without thinking too much. Maybe not suitable for such a style.
An example is someone like IT Jegan who could punch a few hundred orders in a day.
 
@travi , @dpksingh571 , how do you guess the intraday trend ?

I rely a lot on adx(14) on 15 minutes. One gets a trending day about twice a week.
 

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