Lessons To Learn From My Tradign Guru !!

By | September 5, 2022 4:36 pm

In Continuation with the previous 2 articles

Trading Lesson Learnt From my Trading Guru

Valuable Trading Lesson Learnt From my Trading Guru Part-II

Happy Teacher’s Day to the Great Teachers who have taught me how to Trade and above all being *Humble* !!

Remain calm and stay disciplined

The stock market can be very unpredictable and volatile at times. The key to success for an trading is to ride the volatility without getting affected by it.

Don’t make emotional decisions   

Emotional decision making is highly dangerous and can lead to irrational investment decisions that can ultimately harm your wealth creation progress. There may be times when the underperformance of the market can push you emotionally to cut down on your losses by selling your holdings prematurely.

Never stop educating yourself

Keeping an open mind is of paramount importance when it comes to trading. The concept of the stock market is very vast and although you might think that you know everything about it, it is likely that there’s always something that you’re not aware of.

Therefore, it is very important to keep an open mind and accept that you may not be aware of everything about the stock market. Once you’ve come to this realisation, the next step is to continue to educate yourself.

 “Have the courage to trade in big quantity ”

He meant the willingness to carry a very, very large position when you have a high degree of conviction and the risk/reward makes sense.

This is actually the flip side of  My Guru’s last pearl of wisdom- when there’s nothing to do, do nothing. But when there’s something worth doing, then do it in size.

Geroge Soros frequently talks about this, because it’s a common trait of all great traders. In order to be a big winner, you have to be very, very large in the positions that have the best risk/reward. Considering that most traders make their year on two or three big trades, then you have to pile in when you see an opportunity.

The key question is: how do you judge when to trade big quantity ?

The answer: you have to rank your positions in terms of overall attractiveness/conviction and then size them accordingly. Once a trade meets all of the minimum criteria for you to put it on, then you go further and rank it on a scale of 1-5 of overall attractiveness.

To simplify, I have the following criteria:

–        Confluence of Time Cycle of Gann and Astro 

–          An overall stock market that’s trending higher

–         If move coming after 1-2 Whipsaw

–          Higher Time Frame and Smaller Time Frame in Sync

–          Buy as per Stock’s Gann  Positional System

If Stock/Nifty could just barely meet your criteria, In this case, you would rate it a 1 out of 5 (the lowest). On the other hand,if stock/Nifty This would merit a 5 out of 5.

How would your position size vary depending on the rankings? For a “5”, you would want a position size that’s several times larger than for a “1”. That means you could put a “1” at 1-2% of your trading capital, which you would feel comfortable putting on a “5” at 6-10%. After all, you would feel most comfortable betting more on a position where things couldn’t be better, rather than in something that’s barely meeting your entry criteria.

That’s how my trading guru did it. Whenever he found a trade where all of the stars were aligned and he felt that the risk/reward was skewed in his favor, he would put on a gigantic position. And while it wouldn’t always work, the gains on his winners would far, far outweigh his losers, leaving him a substantial winner.

Conclusion:

As discussed  in all 3 article  methodology was quite simple. He would only trust his trading strategy , looking for trades that fit his methodology. When he had no ideas, he would do nothing; when he had a smattering of decent ideas, he would take some risk; and when he had a fabulous idea, he would put on a large position.

It sounds simple enough, but executing it is properly is another matter. As a matter of fact, despite his fabulous example and education,Many traders will be net loser. Why?

When push came to shove, I didn’t have a well-defined methodology for how to approach trades.  Ultimately, no amount of advice will help you when you don’t really have a clear game plan.

As Brett Steenbarger says, the biggest barrier to trading success is usually a methodology problem. Hopefully, my example will show you importance of getting the very basics right.

After that, I hope that the My trading guru advice will help you to transform your trading to the level of the greats.

Category: Learn Motivational Stories

About Bramesh

Bramesh Bhandari has been actively trading the Indian Stock Markets since over 15+ Years. His primary strategies are his interpretations and applications of Gann And Astro Methodologies developed over the past decade.

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