Golden Rules of Stock Market - All
about Discipline
-- Do not play in more than 3 stocks a day! You only understand market direction 100% correctly only in 2-3 stocks a day.. So do not overplay in Stock market!
-- Invest in business you understand: It’s always more beneficial and fruitful if you invest in business rather than stock! In other words, before investing in a company, you should know what business the company is in and what’s there future is likely to be. Proper research should always be undertaken before investing in stocks.
-- Always remember, if market is not stable and very volatile, please stay out of the market for few days, staying away from the market is also A POSITION (which is very tough to do but always beneficiary!)
-- Most of the time, market will go against your wish, so always put STOP LOSS and calculate how much loss you can make in that particular trade if that goes against you.. Do not trade in volumes specially in margin plus or take multiple lots in future plus etc…
-- IMPORTANT POINT: Rather than booking the profit in short term, always place the SL at that point where you want to book the profit and let the profit run, if keeps for few hours, profit will be much higher…
-- Monitor meticulously: Financial markets are connected worldwide from one way or another! Any important event happening in any part of the world has an impact on our financial markets. Hence we need to constantly monitor and keep changing our portfolio to create long term wealth.
-- Results day, let the results come only then take position unless you are sure of more than 100% of your result predictions.
-- Patience pays always in stock market, you need to keep the stock for 2-4 hours to 2-4 days to earn maximum profits and avoid huge brokerages… best way is to revised the stop loss to your buy or sell price and let the profits run for few hours or days you will always benefit more and save brokerages also.
-- Do not play in intraday during results day as rate is likely to swing either side for 2% before taking the decisive way on one side.. Either up or down… main problem is results usually come later in the day and by that time you are stuck in the wrong direction usually... if you are sure of positive or negative results of more than 100% take the position a day before for 1% profit next morning before results come!
-- It is wise to take position after 3:05 pm after the results declared and square off before 10 am next morning!
-- Markets / stocks goes in trend, suppose trend is strong, usually a negative news stock will open very low but will gain strength and end in positive due to short covering later in the day… i.e. do not short weak stocks in the strong market!
-- Nifty stop loss should be at the most of 50 points during intra day…
-- During Intra day, always buy or sell one rupee high or low at the support or resistance level and then place the stop loss at half % and book half to 1% profit - thats good profit in intra day during few minutes only.
-- Do not take overnight risk before results in Infosys and TCS as it shoots up 5-10% and results comes before market opens!
-- When rupee appreciates i.e. $ moves higher from $50 to $55, IT/pharma companies such as HCL Tech, Infotec, Dr Reddy benefits more and shares moves higher followed up pharma companies… and negative for oil companies such as BPCL, HPCL
-- Day traders (avoid intra day trading, if possible!) who suffer from lack of discipline often allow their emotions to rule their trading decisions, which often leads to bad decisions and unacceptable trading losses. Never allow your emotions to rule your trading. In order to day trade successfully, you must develop a trading plan (subject to any changes to it that you feel may be necessary from time to time) and consistently stick to such plan. Get out of the market when you have reached your initial objective and do not let emotions like fear and greed influence your trading decisions.
-- Never borrow money and invest only your surplus fund: If you want to take risk in a volatile market like this, then see whether you have surplus funds which you can afford to lose!
-- STANDARD STOP LOSS - For all the cash positions always keep 10% as your stop loss and 2.5% if you trade in futures. Always keep modify your stop loss as per your discretion /targets specially once you come in profitable trade.
-- IDEAL PORTFOLIO - Please ensure to diversify your portfolio by investing equal amount of money in all the sectors like Banking, IT, Auto, Capital Goods, Pharma, Media, Oil & Gas, Metals, FMCG, Reality, Cement, Power, Telecom etc. as that will help you as some sectors/ stocks will always work for you even in weakest of market. NEVER put all your money in one sector / stock. Ideal stocks should be constituted of blue chips as well as quality midcaps stocks giving blockbuster results along with divided yield companies.
-- For all the new comers - please REFRAIN from thinking of playing in BTST / STBT future calls as it is high risk/ high return trade and only for experienced and professional ones. Still, if you wish to trade in futures / options, please take dummy trades in excel for a month or two at least to see that IF you can handle the volatility of futures. Also, please do not borrow money to trade/ invest in stocks... You will find recommendation on stocks for short term (1-3 months) to long term (6 months to 3 years) at every corrections / dips opportunity. Please invest for long term wealth creation. IDEAL scenario to utilize your surplus money is -- You should put 25% each of your surplus money in Real Estate (Property); 25% in Gold; 25% in NSC/ Bonds / Fixed Deposits and rest 25% money in equities only. I hope this helps!
-- BTST / STBT calls are for future trade for 2-5k profit next morning with 1.5% as your standard stop loss!
-- Do not ask me for day-to-day targets of any stock as I am not an astrologer and do not encourage regular intra day trading as more often than not you will end up giving your profits back to the market by becoming habitual intra day trader!
-- Do not follow calls blindly and use your discretion to book profit or place stop losses as per your risk aptitude.
-- Stock market is all about to be disciplined and have full control on your greed / fear emotions. You can easily make money once you follow my above golden rules; prepared based on my real time trading experience. It`s tough to follow religiously but once you master that and blessed with `abundance of patience` like I am, success is yours!! I can sit in front of TV / market without actually initiating any intra day trading, that`s my mantra to preserve and enjoy my profit :)
I am available if you have more questions.
Happy investing
-- Do not play in more than 3 stocks a day! You only understand market direction 100% correctly only in 2-3 stocks a day.. So do not overplay in Stock market!
-- Invest in business you understand: It’s always more beneficial and fruitful if you invest in business rather than stock! In other words, before investing in a company, you should know what business the company is in and what’s there future is likely to be. Proper research should always be undertaken before investing in stocks.
-- Always remember, if market is not stable and very volatile, please stay out of the market for few days, staying away from the market is also A POSITION (which is very tough to do but always beneficiary!)
-- Most of the time, market will go against your wish, so always put STOP LOSS and calculate how much loss you can make in that particular trade if that goes against you.. Do not trade in volumes specially in margin plus or take multiple lots in future plus etc…
-- IMPORTANT POINT: Rather than booking the profit in short term, always place the SL at that point where you want to book the profit and let the profit run, if keeps for few hours, profit will be much higher…
-- Monitor meticulously: Financial markets are connected worldwide from one way or another! Any important event happening in any part of the world has an impact on our financial markets. Hence we need to constantly monitor and keep changing our portfolio to create long term wealth.
-- Results day, let the results come only then take position unless you are sure of more than 100% of your result predictions.
-- Patience pays always in stock market, you need to keep the stock for 2-4 hours to 2-4 days to earn maximum profits and avoid huge brokerages… best way is to revised the stop loss to your buy or sell price and let the profits run for few hours or days you will always benefit more and save brokerages also.
-- Do not play in intraday during results day as rate is likely to swing either side for 2% before taking the decisive way on one side.. Either up or down… main problem is results usually come later in the day and by that time you are stuck in the wrong direction usually... if you are sure of positive or negative results of more than 100% take the position a day before for 1% profit next morning before results come!
-- It is wise to take position after 3:05 pm after the results declared and square off before 10 am next morning!
-- Markets / stocks goes in trend, suppose trend is strong, usually a negative news stock will open very low but will gain strength and end in positive due to short covering later in the day… i.e. do not short weak stocks in the strong market!
-- Nifty stop loss should be at the most of 50 points during intra day…
-- During Intra day, always buy or sell one rupee high or low at the support or resistance level and then place the stop loss at half % and book half to 1% profit - thats good profit in intra day during few minutes only.
-- Do not take overnight risk before results in Infosys and TCS as it shoots up 5-10% and results comes before market opens!
-- When rupee appreciates i.e. $ moves higher from $50 to $55, IT/pharma companies such as HCL Tech, Infotec, Dr Reddy benefits more and shares moves higher followed up pharma companies… and negative for oil companies such as BPCL, HPCL
-- Day traders (avoid intra day trading, if possible!) who suffer from lack of discipline often allow their emotions to rule their trading decisions, which often leads to bad decisions and unacceptable trading losses. Never allow your emotions to rule your trading. In order to day trade successfully, you must develop a trading plan (subject to any changes to it that you feel may be necessary from time to time) and consistently stick to such plan. Get out of the market when you have reached your initial objective and do not let emotions like fear and greed influence your trading decisions.
-- Never borrow money and invest only your surplus fund: If you want to take risk in a volatile market like this, then see whether you have surplus funds which you can afford to lose!
-- STANDARD STOP LOSS - For all the cash positions always keep 10% as your stop loss and 2.5% if you trade in futures. Always keep modify your stop loss as per your discretion /targets specially once you come in profitable trade.
-- IDEAL PORTFOLIO - Please ensure to diversify your portfolio by investing equal amount of money in all the sectors like Banking, IT, Auto, Capital Goods, Pharma, Media, Oil & Gas, Metals, FMCG, Reality, Cement, Power, Telecom etc. as that will help you as some sectors/ stocks will always work for you even in weakest of market. NEVER put all your money in one sector / stock. Ideal stocks should be constituted of blue chips as well as quality midcaps stocks giving blockbuster results along with divided yield companies.
-- For all the new comers - please REFRAIN from thinking of playing in BTST / STBT future calls as it is high risk/ high return trade and only for experienced and professional ones. Still, if you wish to trade in futures / options, please take dummy trades in excel for a month or two at least to see that IF you can handle the volatility of futures. Also, please do not borrow money to trade/ invest in stocks... You will find recommendation on stocks for short term (1-3 months) to long term (6 months to 3 years) at every corrections / dips opportunity. Please invest for long term wealth creation. IDEAL scenario to utilize your surplus money is -- You should put 25% each of your surplus money in Real Estate (Property); 25% in Gold; 25% in NSC/ Bonds / Fixed Deposits and rest 25% money in equities only. I hope this helps!
-- BTST / STBT calls are for future trade for 2-5k profit next morning with 1.5% as your standard stop loss!
-- Do not ask me for day-to-day targets of any stock as I am not an astrologer and do not encourage regular intra day trading as more often than not you will end up giving your profits back to the market by becoming habitual intra day trader!
-- Do not follow calls blindly and use your discretion to book profit or place stop losses as per your risk aptitude.
-- Stock market is all about to be disciplined and have full control on your greed / fear emotions. You can easily make money once you follow my above golden rules; prepared based on my real time trading experience. It`s tough to follow religiously but once you master that and blessed with `abundance of patience` like I am, success is yours!! I can sit in front of TV / market without actually initiating any intra day trading, that`s my mantra to preserve and enjoy my profit :)
I am available if you have more questions.
Happy investing
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