Few questions for Traders and Investors

Industry Insights
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  1. Would you say that your trading and investment activity have a positive effect on the overall economy?
  2. Have you ever encountered a situation where you were forced to reduce number of alternative choices (Shares/Companies researched) due to time constraint, tediousness and human errors?
  3. If you had the means to analyze charts and look at fundamental and technical indicators automatically, would it be helpful?
  4. Do you use youtube videos, economic newspapers and tips from top traders/executives to make your stock selection?
  5. What is your opinion on practices like margin/leverage, spread, and fees?
  6. What is your opinion on practices like stop-loss hunting, data mining, funding of brokerages by investment banks (conflict of interest) and brokerages taking opposite trades of the trader.
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  • Would you say that your trading and investment activity have a positive effect on the overall economy?

Stock market is the reflection of the economy. It is an ocean and I am a tiny nemo in this ocean. Yes, my investment, I am sure will make a difference, my mother used to say, drops of water makes an ocean, one thing is for sure, Icici direct is making quite a good amount of commission, paying stt, and other taxes will ensure that there is a postive effect. At the same time, the market will (God Willing) make me richer and wealthier.

  • Have you ever encountered a situation where you were forced to reduce number of alternative choices (Shares/Companies researched) due to time constraint, tediousness and human errors?

Oh Yes. The more you have, you lose track of it. At one time, I had so many stocks in my portfolio that I would not even review it. Sometime it could be a blessing - One example is HUL, I had got it when it was in the 500 range years ago. I totally forgot about it and now it is over 2300. The other mistake is if you keep looking at one stock you tend to sell it - Maruthi - I had it when it was again in the 500 level sold it now I it is in the thousands.

  • If you had the means to analyze charts and look at fundamental and technical indicators automatically, would it be helpful?

All this is required when you want to invest in a new company. For existing companies in your portfolio, I do not rely on charts etc as you know by the red or green in your portfolio how good or bad it is.

  • Do you use youtube videos, economic newspapers and tips from top traders/executives to make your stock selection?

I do watch you tube video to understand what these guys are saying. Will never use this info to buy or sell. I used to watch CNBC TV, sometime, they do give out breaking news and based on that i have sold and later realised I was a jackass. So will watch but will never use this info to buy or sell.

  • What is your opinion on practices like margin/leverage, spread, and fees?
    I am a investor and will only deal in cash segment. Will never use margin/leverage etc. Fees is a factor which you keep trying to ask your broker to reduce which he will never do.

  • What is your opinion on practices like stop-loss hunting, data mining, funding of brokerages by investment banks (conflict of interest) and brokerages taking opposite trades of the trader.

I used to watch a guy in you tube and he was insisting that if you invest in stock market you should have stop loss. I could never fathom this idea. However one point is very clear. If your stock is falling do not hold on to it for dear life, sell and get out. You do not need a stop loss for this but you can do it manually. One example was ITC, it was at 300, it fell gradually over the year and came down to 165. I was watching it fall but did nothing. I could have easily sold and bought it back at lower levels. The other positive example is Reliance Communication. I had got it at ipo level, it fell, I averaged, fell, averaged and averaged. In the end it was at level when I closed my eyes and sold it. I am happy I sold it as it is nowhere to be seen. Same thing with 3iinfotch - was supposedly icici backed company average cost at 114 and fell to below 8 or 9. Sold it when it was 8.50.

Again quoting my mother “no one can take care of your money like yourself” I do not have any faith in MF, look at the number of scams that has arisen, FT is a classic case. In one of the website which I follow personal finance plan I read that during last year Adity Birla AMC, jacked up the commission on one of the funds from 0.30 or so to 0.60 (approx not sure of the numbers). The increase meant additional 60 crore for them. AMC can do anything they wish, as the money is already with them. All they do is take it from your portfolio. All this and many more made me realize that even if I lose money, I own it and take responsibility. So no AMC or MF - do it yourself and do it ETF way.
This is the only industry, where AMC make money whether the MF is making money or not. I have never come across one fund which states that if it falls below benchmark, there will be no commission charged.

I also learnt from you tube video the way these online app who deal in shares and offer you zero commission is making money. They claim it is free but the customer is the jackass as there is nothing called free lunch, I have learnt that better to give commission for the work they do and have a peaceful and good night sleep.

Learnt to ride a cycle, drive a car, after education started working and on occasions excelled as well. If I can do all this, this is nothing. Just learn the pros and cons and understand the risk taking capacity you have.

These are my personal views only - I could be wrong and I always am wrong.

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Thank you for your time and detailed answers provided. Hope you stay safe and in the Green!