One of the things that sets the best traders apart is their ability to constantly improve and innovate. By Constantly improving I mean learning from mistakes and not repeating the mistakes again. So how can you break your bad habits and become a better trader?
Understand How your mind works – Most Important part in trading is Understanding How your mind works. How you react when position goes against you. How your mind react when position is nearing SL or target. Do you have internal fight in your mind to exit or not to exit position when it hits target and SL. These kind of situation can only be sorted out when you know what wrong decision you have made in your last trade. So understand how your mind works.
Recognize the benefits of change – if you can understand how you will benefit from good habits you stand to embrace the changes and become a better trader as a result.You Lost money because you were unable to hold the trade due to lack of patience; making trades without researching; If for example you can approach trades with a greater level of focus and calmness, imagine how your trades would benefit from such changes.
Practice the change you did day in day out – One such example is if you’re always averaging a losing trade – it could be a sign that you’re emotionally attached to the trade, a self destructive habit causing anxiety. Write a plan that you can methodically follow so that every time you enter a trade you have a stop loss, or that reminds you not to catch a ‘falling knife’. you need to practice something until it becomes engrained within you. Put yourself in the mindset that if a situation arises that would normally trigger your bad habit(s), how are you going to react?Implement your new positive habits by systematically going through the appropriate response, and continue to do so until it becomes your habit.
simple, just we have to promise ourselves. We are own enemy.
Position trading requires deep understanding of candles….A candle tells a lot about the price behavior if understood properly.
Be long on bullish stocks and short on bearish ones with proper stop loss limits
Useful information
Dear Bramesh Sir,
I am thinking of this strategy to do positional trading in equity futures.
If i have two trading accounts. Suppose i buy a stock futures (lot size is 500 quantity and buy price is 100 rs) from 1st trading account thinking, it is in oversold position. After i open the position, if the stock further goes down, i will be in loss. and also i analysed that it has support at 96 rs and break of this, stock will go much downside.
So what i want to do is, as soon as i open the position in 1st trading account, simultaneously i place short sell of this stock futures with market order trigger price of say 95.50 rs in 2nd trading account. by this way i am offsetting loss of 1st trading account with profit from 2nd trading account.
after few days, stock went further down till 80 rs, where it has very strong support. i will square off 2nd trading shorted futures with profit and keep open 1st trading account position.
and stock will rebound to say 90 rs i will square off 1st trading account position also. so always i will be getting profit by this strategy.
Please let me know, whether this strategy works. if not what factors are lead to failure of this strategy. Please reply to this bramesh sir or anyone else who already tried this.
Please forgive my mistake, if you find this as silly question. i have incurred lakhs of rupees loss from so many years. so please help me and guide me friends.
thanks very much.
Best Regards,
santosh
dear santosh…………..stock price may choppy……it is not predictable as u r saying…….so ride the trend…… right entry & exit matters………..if you want to hedge than go for option………..
Santhosh,
This is my experience. It works if you get out of the positions at ‘right’ time or else the losses may go up drastically. Many a times I tried this way too, sometime back. The point is how to determine which is the ‘right’ exit point to come out.
We come to this point [both buying and selling] to make sure that we do not incur anymore losses but the reality simple doesn’t fit into. Later, I found that I’m too unbalanced to profit from this ‘strategy’ and so never again traded this way since over 6 months.
Indeed I found another strategy beneficial but the thing is I’m too scared to wait. This strategy is Buying and Selling BankNifty Calls and Puts just around 600 -800 points on the beginning of new Series. This would have fetched me 4 times the total initial capital [4 lacs would become 16+ lacs] if I had waited for 10 days but am too panic-stricken to stay for that period so I came out with a loss.
Man, this whole game of Trading is nothing but testing of human endurance and fortitude. If you can stand still amidst extraordinary losses and laugh, still hope to win oneday, and if you begin that new process this very moment, may be there is real hope because nothing succeeds like success and success always favors the brave.
Best
thanks for sharing your valuable inputs
I tried back testing for my own past trades ( 2 years). The failure of this strategy lies in point of exit of 2nd position. After exit, if stock still goes downside, again need to re initiate 2nd position to protect from 1st position loss.
But i eventually end up in open and close of 2nd position multiple times which leads to multiple losses & may be sum up to huge loss.
Better to take position on one side only based on the trend and price action as suggested by Sourav and jamwalr with proper stop loss and entry exit criteria.
Eventhough we may still incurr losses, we will be still having money in our accout to trade and learn from previous mistakes.
Thank you all for you valuable suggestions and all the best.
Thanks & good luck bramesh sir, for your kind service.
Best Regards,
santosh
Please forward any books / journals on trading with strategies or methodology, risk management,etc. (ksantoshk9@gmail.com)
Thanks & Regards,
santosh
Please backtest the same for 1 year and see the results.. Strategy should be simple not complicated .. you cannot offset loss of 1 account to another.. Market do not work on our whim and fancies..