friend, i had the same problem 2 yrs ago, before taking rest from trading,
i came back and started trading with the minimum qty possible and max 40-50 % of my total cap.
After a trade loss, I lookout for defect in the trading plan/system. Then, I look forward for next trade.
After a loss, it would be better to take a small break from trading in order to come back with a new strategy but for this one is need to be prepared. a trader should go for a small trip to fresh and regain mindset of trading. Next time choose a stock after using a strong trading strategy.
Yes. Right now i have diversified my portfolio even though the capital is not big enough. Its my dadās hard earned money which he allowed me to invest so i take utmost care that no matter how much market goes down, i have to keep min. This much amt. Of profit. I have diversified my portfolio with majorly small caps and mid caps where min investment amt is around 1500 and currently i have 20-22 stocks in my portfolio.
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When you take a position and it slips into a loss, what is your first reaction and how do you manage your position after that?
- My first reaction is
āI havenāt read the pattern properly and try to evaluate what went wrongā. Sometimes, I am not able to find convincing reason behind the failure of particular trend. I give credit to Market for all such trades.
Has a loss position turned into a profit position? If yes, what did you do to make this happen?
- Yes
When I trade with different scrip.
- No
When I continue trading in same scrip.
Most Important Learning
- Please verify the trade details before initiating.
Few times, I have booked losses because of my will to enter into trade as soon as possible. I have forget to revise the SL of cover order suggested by Zerodha. And if your quantity size is big around (2-5)K. You will easily make loss of 1-3K including brokerage and taxes.
- Please donāt over trade in-order to recover your losses. You will end up making more losses.
- Once your trade starts moving in positive direction, donāt forget to revise the SL so that you donāt book any loss for this particular trade.
Note : I know the 3rd point is highly debatable, but I follow this strategy.
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Yes, exactly. Some times I wired on seeing the opposite trend even though news says company got profit etc.,
FRIEND,
THATāS NOT THE OPPOSITE, EITHER THE NEWS HAS BEEN DISCOUNTED EARLIER BY BIG PLAYER OR THEY HAVE SEEN A OPPOSITE SIDE OF THE NEWS.
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BRO,YOU FIND DEFECT IN YOUR TRADING SYSTEM, MEANS YOU ARE NOT CONFIDENT OF YOUR TRADING SYSTEM.
FIRST YOU MUST MAKE A TRADING SYSTEM, YOU CAN BE CONFIDENT ON THAT.
diversification is a must have thing for a investor, but 20 stocks are very difficult to be tracked on regular basis.
but if for long term its ok.
i have a tip: if your stocks perform as per nifty, buy a put below 10 rs for hedging propose.
if they are not relative to nifty keep tracking them
It is a wrong notion to not rectify trading system out of defects/shortcomings. If u think, ur trading system is 100% fool-proof, thn it is over-confidence.
p.s: Bro, did u notice the Caps Lock ON, only after two replies!
i only react if i did not follow my rules. if loss happened within my rules. its ok
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MY FRIEND I THINK YOU DINāT READ MY REPLY, JUST GAVE A LOOK AND MAKE YOUR REPLY
I TOLD TO BE CONFIDENT OF YOUR SYSTEM, I DINāT SAY IT TO BE 100% CORRECT,
EVEN IN A VERY GOOD SYSTEM SL HITS.
THIS IS NOT A PASSWORD OR LIKE THAT TO BE CAPS ON / OFF
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Sorry, I am new to trading and investments in Equity markets. But I have to ask this:
What exactly, is paper trading?
Hey @Apurva.Kunkulol Paper Trading means you will Buy stock using not real money.
Just to test your skills & learning you will write down the buy price & quantity on paper or using any Dummy Software.
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The best way is to stop intraday
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Oaky, and observe the price movement over time, right?
hereās a virtual trading game which will hone your skills, which I am using myself to get my basics right.
http://chartgame.com
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Loss is a part of trading. You never need to panic when this situation occurs. Many traders try to trade with high lot sizes in order to recover their loss. You are advised not to do this mistake on any cost. You have to keep yourself organized in every situation as long as possible.
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Itās better to consider it as a usual and valuable experience. You donāt need to turn on emotions and listen to them. You need to analyze your losses and understand them.
Whatever people may say,i stopped trading few months back and im happy now and without any fancy i can live my life well and the greatest part is i paper trade ans it adds more thrill to me
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