I have the knowledge but no capital to trade


#1

I was in the market since 2016.I am interested only in f&o sigment. I traded options (only buying options) f or the intial one year and lost some money. I had stopped trading since last 1 year to review my mistakes. After the review i found out my mistakes as listed below.

  1. Not having enough capital to trade futures. For example, i start trading whenever i have 1 lakh as capital which is really not sufficient for trading futures and i vl be out after two to three losing trades.

  2. No risk mangement and capital management. If I had done around 100 trades, 80 were closed in profit and 20 were closed in loss but the loss will be huge whereas the profits will be small. The reason i found is that i will not wait until my target is met even if the trade is winner. I closed the trade once it turns in to profit.Again the culprit here being fear of losing the capital.

  3. No hedging while holding futures overnight.I lost around 60k in two trades due to market collapse overnight.

I have corrected most of my mistakes and now i have preapared a checklist. Now iam paper trading with virtual capital of 10 lakhs from last two months and know what i was earning profit of 50k everymonth.

Now i want to start trading in real market but do not have the capital. It will take 3-4 years for me to arrange that amount i.e. 10 lakh by way of savings. Taking a loan had crossed my mind but refrained my self from doing that as it is the first step in destroying my peaceful and healthy life.

Now my request from to all of you is

what should be the ideal capital size required positional trading of futures.

Should i keep on doing the paper trade for another 3-4 years untill my capital is arranged.

Thanks in advance.


#2

10 laks or more…


#3

You will just be wasting your time cause the main thing you won’t be able to experience is emotion control and proper risk management if you just keep doing paper trading for years and years. You will be only be fooling yourself and wasting time.

Ideal way to start trading is to start trading small instead of trading some huge lots futures.


#4

Yep…u r correct…i know it.

But the problem in cash market is i wont be able to hedge the position to avoid overnight risk in case of long positions.

If my system generates a shorting oppertunity, the same cannot be done in cash market.

Any ideas on how to overcome the above difficulties?


#5

Your case is somewhat similar to mine.

Today first time I traded with real money & I lost 4k on my first day of trading.

Before this I was paper trading & profitable for 2 months.

I suggest u to trade only 1 lot at a time. 1 lot on intraday basis can be purchased within 50k for most of the scrips.

Start small. Find ur error, fine tune ur stategies.Make profits.

Wish u good luck my frnd.


#6

You can’t short Equities in Cash market for overnight position. And you are talking about shorting Futures overnight which carries huge risks even with hedging and you will need a big enough capital to be successfully doing so.

If your system generates shorts then you can buy puts but i won’t say you should just blindly buy puts whenever you see a Sell. But yes it can be done profitably given that you know what you are doing quite well.


#7

If you can save 10 L in 4 years, you should not be trading in my opinion. Wisely, use that amount to plan for retirement.


#8

Bad advise… All it takes is one bad scenario or a spoiled kid to exhaust all your savings…


#9

Better than speculating, loosing it all and then going into depression, isnt it ?


#10

Thanks for your valuable advise…

I am presnetly 31 years old.I am doing a good job in govt with reasonable salary. I may get good amount as reirement corpus and in addition i am presently saving around 20k per month.

I want to make it big in life like many of the traders. In my opinion trading is not speculation but all about discipline and risk management where u will have chance to make it big.


#11

No… Not at all… One should learn the methods of proper speculation before doing it…


#12

Exactly !!!


#13

Yup…thanks for the valuable suggestion.

I do agree that options need small capital compared to futures. It can be done but u need to spend lot of time in anlysing options as the options price depends on many factors like delts,theta,vega etc.

For futures, the time taken for analysis will be much less when compared to options. Since i am doing a full time job spending too much time in front of trading screen is not possible.


#14

All the big ones you see on social media have ancesteral wealth and other sources of continous fund supply, not the case with a working individual like you.

not speculation but chance, its all the same isnt it ?


#15

Yup…may be u r correct


#16

No…i dont think so…trading needs knowledge like any other job.

But in trading, the psychological stress will be much higher…People who can overcome this will be successful.


#17

My sincere advise for you is please dont do intraday that too in futures unless u r a full time trader and have a strategy which is back tested.

Do not start trading in futures with 1 or 2 lakhs as capital.


#18

Thanks for the advise.


#19

swing trading it will take years to make much money. Because Return in Swing trading is not going to much because stock gap down, gap up. One bad trade or Some bad News about stock you bought and poof your all profit of whole year gone in one trade. Good luck next year.

Also I think government employees not allowed to trade… I’m not sure and I may be wrong, but you should check it out.


#20

This psychology Bullshit has been going far too long.

This is typical excuse given when a trader fails , because you can always blame the psychology.

This is one of the biggest lies/scam in the trading education industry.

Don’t fall for it.