Evaluate my Margin Trading Technique plz

#1
After making considerable loss in Margin Trading Intraday...Now I wanna start right...So started paper trading now...Here's the technique I wanna follow and pl be aware I do not know to use charts and do not want to use one becoz, It is harder to automate the trade in later time (which I am strongly planning to do)...

1. Market Trend : Identify whether market is going up or down.
2. Sector Trend : Identify whether sector is going up or down.
3. Stock Trend : Identify whether sector is going up or down.
4. Volume Trend: Confirm volumes are according to the trend.
5. Place order and book profit.(Im expecting 0.4 percent per transaction,)

Example: Assume I wanna buy ICICI Bank in the following situation:

Variables:

1 Market Trend: Positive (Market is moving up)
2.Sector Trend: Positive (Banking sector is up)
3.Stock Trend: Positive (change more the 1 % of previous day close)
4.Volume : More buyers than seller (total bid to total offer ratio > 1.2%)
5.Check Derivatives of the particular stock (This seems to be important but I do not know what's derivative (after considerable reading) and how to deduce anything out of this.)

DECISION: In the above conditions I BUY ICICI Bank and keep checking for all the above trend remains same during the period I hold my stock.
> If any of the above conditions change, especially Volume, say if total bid to total sell ratio falls to 0.9 percent (price should fall, Square off with Loss)

> If total bid to total sell ratio reaches more than 1.2% say 1.5% the Square Off with profit.

I know there a lots of Punters here, Pl don't laugh at this, If this is pretty lame. Pl tell me whether this technique works or any suggestions to improve this technique or pl tell me if this doesn't work at all.

Thanks a lot guys...hoping to hear responses...
 
Last edited:

findvikas

Well-Known Member
#3
After making considerable loss in Margin Trading Intraday...Now I wanna start right...So started paper trading now...Here's the technique I wanna follow and pl be aware I do not know to use charts and do not want to use one becoz, It is harder to automate the trade in later time (which I am strongly planning to do)...

1. Market Trend : Identify whether market is going up or down.
2. Sector Trend : Identify whether sector is going up or down.
3. Stock Trend : Identify whether sector is going up or down.
4. Volume Trend: Confirm volumes are according to the trend.
5. Place order and book profit.(Im expecting 0.4 percent per transaction,)

Example: Assume I wanna buy ICICI Bank in the following situation:

Variables:

1 Market Trend: Positive (Market is moving up)
2.Sector Trend: Positive (Banking sector is up)
3.Stock Trend: Positive (change more the 1 % of previous day close)
4.Volume : More buyers than seller (total bid to total offer ratio > 1.2%)
5.Check Derivatives of the particular stock (This seems to be important but I do not know what's derivative (after considerable reading) and how to deduce anything out of this.)

DECISION: In the above conditions I BUY ICICI Bank and keep checking for all the above trend remains same during the period I hold my stock.
> If any of the above conditions change, especially Volume, say if total bid to total sell ratio falls to 0.9 percent (price should fall, Square off with Loss)

> If total bid to total sell ratio reaches more than 1.2% say 1.5% the Square Off with profit.

I know there a lots of Punters here, Pl don't laugh at this, If this is pretty lame. Pl tell me whether this technique works or any suggestions to improve this technique or pl tell me if this doesn't work at all.

Thanks a lot guys...hoping to hear responses...
Here is the problem with this system, you are not tracking the chart of the stock that you buy but looking at entire sector... why can't a single stock outperform or underperform the sector or even market? days back entire markets were down 1.5% and all the high beta were down... energy pack was down after US's energy pack was down... according to this you should have shorted Suzlon, right? but Suzlon was up 5-7%...

So take my advice, get some knowledge first. What you have so far is data... but not really sure how to analyze it and make decisions on the basis of that. Charts are like ECG for any stock.. you need to have an open eye on ECG while doing operation :)
 

trader.trends

Well-Known Member
#4
4.Volume : More buyers than seller (total bid to total offer ratio > 1.2%)

> If any of the above conditions change, especially Volume, say if total bid to total sell ratio falls to 0.9 percent (price should fall, Square off with Loss)

> If total bid to total sell ratio reaches more than 1.2% say 1.5% the Square Off with profit.

...
Amongst all figures please understand that TBQ and TSQ are the easiest to manipulate. If a stock is quoting at say 100 with TBQ at 100000 and TSQ at 80000, you might think there are more people who want to buy the stock. I will put a buy for 25000 shares at 80/- immediately creating a demand for the stock as the demand has now gone up by 25%. See how easy to manipulate that figure? If there is one figure you have to ignore when trading it is the TBQ and TSQ. Give importance to volumes. That figure indicates how many have already been bought and sold. If the stock is up with above average volumes then it indicates bullishness.

Creating a strategy based on just TBQ and TSQ is a recipe for disaster.
 
#5
According to me, if you do 10 trades under this strategy, you may incur loss for 3 trades.

I did not use any charts,TA, Etc.. Because i am not an expert. By taking high volume traded shares, i will fix profit for 0.30% paise only. i will not put stop loss. because 0.30% will incur
within 5 minutes. daily i am doing 20 trades. but incurring loss is just 4 trades. i make more than 4% on my investments.

This is working well for me.

Vinothbabu.
 

rkkarnani

Well-Known Member
#6
According to me, if you do 10 trades under this strategy, you may incur loss for 3 trades.

I did not use any charts,TA, Etc.. Because i am not an expert. By taking high volume traded shares, i will fix profit for 0.30% paise only. i will not put stop loss. because 0.30% will incur
within 5 minutes. daily i am doing 20 trades. but incurring loss is just 4 trades. i make more than 4% on my investments.

This is working well for me.

Vinothbabu.
Great going indeed!!! Trust like any other trade you also must be incurring brokerage , slippage, STT on your trades!!! I do believe that trading without a SL is an invitation for disaster!!! Your target may reach in 5 minute but so could the market hit the circuit in 5 minutes or the stock could plunge without a warning!!! Be careful, trade with caution!!! As you have been successful in the past , you are best judge for the strategy but I would like to tell you : Please dont get overconfident!!!
 

jxcess

Active Member
#7
According to me, if you do 10 trades under this strategy, you may incur loss for 3 trades.

I did not use any charts,TA, Etc.. Because i am not an expert. By taking high volume traded shares, i will fix profit for 0.30% paise only. i will not put stop loss. because 0.30% will incur
within 5 minutes. daily i am doing 20 trades. but incurring loss is just 4 trades. i make more than 4% on my investments.

This is working well for me.

Vinothbabu.
Here are some points to ponder over in regards to the above trading technique:

1. If u do 20 trades at 0.3% profit then u get a total profit of 6% in a single day.
2. But for this u have put you entire capital in a single stock at a given time.
3. Considering there are 6 hours for trading between 9am to 3pm, to do 20 trades u have at the most 18 minutes between any 2 trades. So the stock has only 18 minutes to rise by 0.3%.