A plunge in Indian Stock market

[amitrandive]

Averaging loosers another sure shot recipe for financial disaster.
Along with your original strategy for converting loosers to delivery.

Please check the above post ,that is where you are going wrong again and again.

 

[sspms2002]

FYI

Motherson Stock analysed.

Yes Amit, this stock proved very much the imp of getting out of bad position..cutting losses when they are manageable...
converting this stock to delivery would have meant nemesis for many traders...

i see many people struck in this stock from 350 - 380 levels and there is very slim chance of it getting into 300+ range anytime soon...

i would also like to put up my analysis of why the above problem happens:

When a novice starts to trade..he books small profits...and when any loss occurs, he would not book it..probably as he is already in losses or at breakeven....

this deters him from booking more losses..and as we already know Murphy's law....the situation most time would get worse and he eventually gets out with a big loss...


But certainly this above scenario starts reversing when a trader starts gaining more confidence and and starts making some money...with the renewed confidence in himself...he can cut the losses..when they are manageable...

 

[amitrandive]

Good articles on cutting losses

http://www.investopedia.com/articles/stocks/08/capital-losses.asp?adtest=article_page_v12_v1
http://www.capitaltrader.com/BasicTraining.htm