Can you find out risk in my below trading strategy
1.Invest for just 10% return in equity only delivery.
2.Invest in good fundamental company debt free,good cash flow,good promoter fii dii holding,increasing sales,reserves higher than debt,etc
3.Take entry on breakout
4.Get 10% profit and exit
5.DONT USE STOPLOSS,if stock falls with good fundamental hold it till you get profit no matter how long.
6.Capital invested in single stock is equal to 10% of portfolio.
I want to change my stretegy what it should be?what change should I do to get more…
Fundamentals can change at any point in time. May be due to change in Government policies or some other external factors like (Climate, raw material price variation etc). If you are confident enough to identify this changes faster than other market participants like Mutual fund houses, HNI etc who spends huge resources on research, then may be this strategy will work. Otherwise it will be risky.
Do you think that investing in good companies with good fundamentals will always be profitable ? NO.
My personal opinion - There is no easy way to be profitable in market, return comes with risk.
10% is NOT easy.
Than what changes should I get in my strategy?can you suggest?As only fundamentals are the mirror of company that I prefer to check before any buying,but as u say changes in fundamental news comes late very late…
But I am not a trader I just buy stock and hold it till it gives 10%and then sell,again search for other stock…If fundamental not works than what?technicals are after effect of price so technicals also not valid.
Than what is the safe method…
I am not sure about that. May be If your skill set is more towards analyzing fundamentals of the company, then may be invest in basket of 12-15 stocks with long term horizon like 10-15 years. May be 3-4 companies will go down. But you may get 1 multibagger or so which will cover the risk. Then remaining might give good returns. By including processes like annual reshuffle (Removing weaker and adding more quality stocks) and Monthly SIP mode for investment it may give you good returns. But your above mentioned method with a small target like 10% without any stop loss feels too risky for me. (From your message I am assuming your skill set in identifying fundamentally strong companies is reanably good). Also please note :- I am not that successful trader/investor so it will be better if more successful investors come and guide you.
Some day without SL , You will stuck in a company which will ne remain or go down for next 10-12 months. That amout will ne blocked. Think if it happens for your 4 stocks.
Yes that is the problem actually I am facing…That amount got blocked for long period say in such trending market for 6-9 months…What should I do?Market volatility is at extreme kahi b rakho SL hit hota hi he uske baad hi move aata he…
I will not buy at any price.My buying plan is as below
1.Stock should be in up trend
2.Breakout of pattern or resistance with high volume
3.Deli vol should be high
4.PE should be reasonable as compared to sector pe
5.Volume should be rising
6.MFI should bee above 50
7.Sector trend
After fundamental analysis I will se above said technical parameters
This is my buying plan…
Areee u got it wrong.I just want to know if I will follow above mentioned startegy,is there any chance that I will loose my all money?if yes what can be happen which will spoil my money because of this strategy.
I check technically and fundamentally both and I believe in both as well…from fundamental I decide what to buy and from technical when at what price to buy and sell…
I am searching for my loop holes in my strategy to make a contingency plan
There no rule that all fundamentally strong stock give good returns in the long run, you will just be sitting on net zero profit. You strategy is not vise in comparison with market performance.
Try adding a comparison with other mutual funds or bank returns, if a stock hasn’t given more than 6% return in a year your money is not getting enough ROI which means you took more risk than return!
Try avoiding fixed percentage return, rather than focus on ROI.
Try using supertrend systems or pivot point systems to attain technical targets and not just 10% as you say.
It’s not that easy to earn in stock market.
This means your capital is locked (which otherwise could have earned some money elsewhere). + Mental taxing of seeing your portfolio in Red. You need to ask what if all your holdings are in Red, and you see a great opportunity
Hard to define, Good fundamental companies can also have a significant Drawdown.
Why only 10%, any particular reason ? Instead why not keep a trailing GTT based on the structure. You may get more than 10% which will cover some of your SLs
My first priority will be to protect the capital, then comes the profit. Use SL based on the market structure/ Price action. Size your position according to your defined SL.
There is no clear defined strategy for retail investors. Big funds and HNI decides the market and not retail investors.
My strategy is buy low sell high. It always worked for me. I agree with your view of not to use SL. You must have patience though. If you invest don’t put all your money all at once. When market is going down without any major reason or news, buy stock by putting 15% of your funds, if stock further goes down next day… put another 15% and so on. Learn how options trading works. Beware of fake / propogandist news articles.
I am not a pro. I am in the stock market for 5 years only and my ROI is 20% average per year. You have to change your strategy as per situations prevail in the stock market
Options are risky…I have tried but not succeed over emotions and FOMO,I can’t tackle them.
Yes 15% of portfolio is applicable and seems safe too under any situation…
Buy low and sell high is easy to hear but tough to apply,can you suggest any tool for the same…I use support resistance for trading and trade on breakouts…But already stucked in few stocks in recent fall…it’s ok I know it will return back I m not worried about them.
Can you suggest me any strategy fot buy low and sell high…?
Also can you find any loop hole in my strategy by which I may have huge loss?
I am not saying you have to invest(buy/sell) in Options contracts but you should know Options very well. Many times it is the Options contract(s) that decide underlying stock’s price movement.
Also you should need to learn the ‘game’ of projecting or guessing the stock’s wind flow well in advance. e.g. oil companies stocks are 33% - 44% up from its basis 6 months ago. When we know economy is anyway going to open up after vaccination , oil up trend was bound to happen. Pick the stocks that are volatile for whatever reasons. EPS history of the stock for few past quarters is the key parameter to gauge before you invest. If you got goosebumps while watching Scam 1992 serial especially when scrips starts going up after of Harshad’s entry in the ring, then you are not perfect for investment.