Is Daytrading dangerous?

[AbhiRao]

Hi All,
I have been doing day trading quite regularly.I have never used charts or nor looked at the price movements of stocks at the first 5 minutes.My intention is not to offend anyone in this thread.
But all that it takes is little bit of luck and timeliness.I were watching one of the analyst in CNBC talking about a particular stock(I do not remember the stock).It's market price at that time was 55Rs.This analyst was saying don't enter this stock until it breaks out 62Rs levels.Once it breaks this level it might go upto 85Rs.Bull ****! You do not buy a stock when it is @ 55Rs You Buy it when it reaches 62Rs!
I do not subscribe to this idea of resistance levels etc.It's all rubbish.Looking at chart when sensex was hovering @ 5000 levels when BJP government fell, did any of the analysts(by looking at charts of course!) predict that sensex will touch 14000 in 2006.
My trading stratergies for day trading are very simple.As I am ambitious I do day trading in highly volatile scrips.I do not invest all the money at once.I keep buying at lots of say 100.If it goes below I buy more of it.If it goes above I sell them off.
Good thing about volatile scrips is you can predict the day's low or high most of the times.When it is nearing bottom huge buy order comes in at the lowest possible levels and it starts going up gradually from there on.Actually one could make out that some operators are behind it nonetheless for me the important thing is to notice is when to buy.Of course you need to have a streaming quote based system where you can watch the fluctuations in real time & also frequently look at best 5 buys/sells so that you know which way the stock is going to go!

Best Regards,
Abhi

 

[raju600005]

We had an unususal short lived Bear Market before July and you r right....
It did seem as if it was a Bear market rally.I also fell into that thought trap.
However if one had sold prior i e in April/May they could have made fortune by picking the same scrip at very low rates.You must be watching for trend reversals....

Refer to Victor Sperando's The Principles of Speculation.

I am Curious about Abhi.Does Abhi make a decent return from Day trading?

 

[jassinko]

i also trade like abhairao
see on friday i had only 10k and i bought 200 nissan copper at 50 and after a min or so it goes to 57, i sell it and same procedure of bying and sell of 200 hares continues to 5400 level and in the end earning a profit of 11.5k in a day
i dont want to boast of me but to tell there are many opportunities to grab in day trading
just look out for those and u will definately earn profit

 

[Agilent]

We had an unususal short lived Bear Market before July and you r right....
It did seem as if it was a Bear market rally.I also fell into that thought trap.
However if one had sold prior i e in April/May they could have made fortune by picking the same scrip at very low rates.You must be watching for trend reversals....

Refer to Victor Sperando's The Principles of Speculation.

I am Curious about Abhi.Does Abhi make a decent return from Day trading?

I too am curious

I wonder how he operates


He says :
As I am ambitious I do day trading in highly volatile scrips.I do not invest all the money at once. I keep buying at lots of say 100. If it goes below I buy more of it.If it goes above I sell them off.

I am thinking .. what happens if it goes down further .... surely there must be several such cases where he wd have 'averaged' and got into a bit of mess (unless he has taken delivery and the scrip has bounced back later)

As for his rubbishing resistance levels etc. (and why buying at 'higher' levels in some cases makes more sense) I wd suggest seriously that he reads some good literature on the concepts (after all, a little knowledge is a dangerous thing ...)

But at the end of the day, the proof of the pudding is in the eating ....and if he consistently makes money without employing any structured methodology, then hats off to his skill /luck/intuition /whatever else.

Who are we to complain , or criticize !

AGILENT

 

[AbhiRao]

Hi Agilant,
Many of you in this thread are suspcious about my talk I guess For a long term investment I would definitely do a research on the balance sheet ,P/E ratio company fundamentals & market capital etc.

However anyone who does a day trading cannot rely on any of the above as you know infosys also can go down on any given day.Isn't it?

To your question whether you wonder I have made money???In fact I have made money in day trading.My day trading funda is very simple.Don't be very greedy.When you have sufficient margin to book profits sell them off.Whether it is 50ps or 25ps per share it really does not matter.

Though I do not look at the charts I do look at some of the following things.

• Recent Highs/Lows
• News on the stock

This is stratergy I follow.What I have observed is many volatile stocks go up exponentially during the first 5-10 minutes of the trade.I do a "Short Sell" in such a case.I wait for the price to stabilise which it does and comes down by 3-4% from the peak I do buy & square off my positions.If it went down further I take long position(As I have already made profit by short selling in the first place...Now my risk apetite is much higher).

Now to your question what happens when I average out by buying more at lower levels.It is only human to err.If everyone were to look at the charts and predict the movements of stocks then there would be no loosers in stock market.Don't you think it is too hypothetical to base your opinion purely on charts?

Yes.In few cases I have taken delivery by taking long positions and in a day or 2 I have again squared off my positions with some profits.This is precisely the reason I do not involve in margin trading.As I know if in case the stock went down too much then I have to take delivery.

Hope it is clear.

Best Regards,
Abhi

 

[Agilent]

Hi Agilant,
Many of you in this thread are suspcious about my talk I guess For a long term investment I would definitely do a research on the balance sheet ,P/E ratio company fundamentals & market capital etc.

However anyone who does a day trading cannot rely on any of the above as you know infosys also can go down on any given day.Isn't it?

To your question whether you wonder I have made money???In fact I have made money in day trading.My day trading funda is very simple.Don't be very greedy.When you have sufficient margin to book profits sell them off.Whether it is 50ps or 25ps per share it really does not matter.

Though I do not look at the charts I do look at some of the following things.

• Recent Highs/Lows
• News on the stock

This is stratergy I follow.What I have observed is many volatile stocks go up exponentially during the first 5-10 minutes of the trade.I do a "Short Sell" in such a case.I wait for the price to stabilise which it does and comes down by 3-4% from the peak I do buy & square off my positions.If it went down further I take long position(As I have already made profit by short selling in the first place...Now my risk apetite is much higher).

Now to your question what happens when I average out by buying more at lower levels.It is only human to err.If everyone were to look at the charts and predict the movements of stocks then there would be no loosers in stock market.Don't you think it is too hypothetical to base your opinion purely on charts?

Yes.In few cases I have taken delivery by taking long positions and in a day or 2 I have again squared off my positions with some profits.This is precisely the reason I do not involve in margin trading.As I know if in case the stock went down too much then I have to take delivery.

Hope it is clear.

Best Regards,
Abhi

Listen Abhi... we are not sceptical ... only curious .

I will only reiterate my earlier point : as long as u consistently achieve more hits than misses, great going ! And keep it up

Honestly, it is an admirable skill ... and all of us wd have at some time felt that we have a 'nose' or sixth sense for trends. Obviously yours is more developed than most others'

But tell us ... what happens if u have short sold, and then the scrip gets locked in up circuit (can happen sometimes u agree?) What is your remedy in such cases ?

AGILENT

 

[swagat86]

Listen Abhi... we are not sceptical ... only curious .

I will only reiterate my earlier point : as long as u consistently achieve more hits than misses, great going ! And keep it up

Honestly, it is an admirable skill ... and all of us wd have at some time felt that we have a 'nose' or sixth sense for trends. Obviously yours is more developed than most others'

But tell us ... what happens if u have short sold, and then the scrip gets locked in up circuit (can happen sometimes u agree?) What is your remedy in such cases ?

AGILENT

Hi AGILENT, There is only one answer to this Question and that is Auction.
If ur shorting u gotta be real careful. And also there's no scope of Buying as its in UC according to u. So i think u hav to bear a Loss.

Although i heard Brokers do take a cover order in such cases. But thats just a "heard thing".

Thanks

 

[anjanr]

Its safe to trade with stocks which are in f and o. There are no ckt for those stocks .

 

[AbhiRao]

Hi Agilant,
It rarely happened to me.It happened once with Mirchandani Electronics.Next my broker bought it for me in the auction market.
If I have to short sell I would ensure that there are no news flows for that company.

For example when there was this news that tech Mahindra got 1billion$ order I did not short sel even if the stock went up substantially as i know it will sustain at those levels because there is strong news flow on that stock.

I do take this risk of short selling only on a normal day when there are no news flows or quarterly results are not around for a stock.

Hope it is clear.

Best Regards,
Abhi

 

[abdur]

do't forget that day trading is a one day cricate match so win or lose must come out as result. For that your trade must be right for that day.There is no other option. It is not dengerous but a work of skill hands and exprience.

thank you.