Dear all,
So this week I started trading with my options system , which is now a combination of a lot of feedback given by people here plus I've incorporated some rules from Ghosh Sir's system. So a big thanks is in order to everyone who gave me their feedback - thanks a lot guys !
The 1st two days have been very good (maybe I'm having beginner's luck) and I've captured 103 points across 6 winning trades with no losing trade yet. I've attached the details of 6 trades if anyone is interested.
Some findings (maybe too simplistic and already you guys must have known this, but its just for my documentation
)
1 - A trading system with so many rules generates signals all the time, you cannot act on all signals.
2 - While entering a trade based on the system its also important to keep track of news flow (for NIFTY especially) because situations can change dramatically fast.
3 - To keep having winning trades its most important to ALSO close a winning trade fast. Getting a losing trade hurts, but when a winning trades turns into a loser, it hurts even more. So I've been taking my profits when I've thought I cant wait anymore at the cost of losing what I've gained. So a trailing stop is key here , that takes the decision out of one's hand.
4 - Options as we all know are very sensitive to many variables not just the underlying price move. So sometimes we might be trading volatility sometimes time decay or sometimes both or a combination. I think understanding of the greeks and their impact is most critical. Sometimes the underlying price moves but the option just does not, and that can frustrate - but the price eventually catches up in a few minutes - if the trend is still intact. Knowing this lag has been important to me.
Since I'm testing this system, I'm only committing around 50k. Attached are my trades for the past 2 days.
This community is great - very constructive and it is helping me a lot.
Thanks once again.
TJ