Bull Zone

[raosrinivas]

I am not sure if my previous prediction has turned into a "self-fulfilling prophecy". i am starting this thread to cheer up the bulls. while i do not care where the market goes, i am sensitive to losses of individuals, and i am wishing that the market reverses it's trend and starts moving up. whatever is the case,

1. always keep your SL's intact,(this is for people who are already in position)
2. stick to scripts, what profit you want to get out/ what loss can you take. do not use discretion during such times
3. temptation to get into a position at the bottom is difficult to overcome, if you want to invest x amt in a stock , its better to invest x/3 first and when it moves higher put another x/3 amt and another move another x/3. if it moves higher it's fine. if it moves lower you get out with only 1/3 of loss .

you guys are smart. i am wishing you all good luck.

i am hoping the market moves higher tomorrow(looks like my timing is not correct here, it may open gap down because DOW,NASDAQ and SP500 down more than 1%).

thanks
Srinivas

 

[raosrinivas]

so i can dictate the market direction just by wishing....i should start charging....

 

[sudoku1]

so i can dictate the market direction just by wishing....i should start charging....

If wishes were horses .....

 

[amir786]

guru this is not alice and wonderland...................

 

[raosrinivas]

Markets look poised to end the day in green. there does not appear to be a lot of conviction on the part of buyers as is evident from lack of a convincing rally. market is range bound. range being ( 16500-15500 ) , i know that is a big range. look for a break of either.

 

[raosrinivas]

I am not a great investor/trader but I just thought of sharing one of my experiences with a Trading System.

TRADING SYSTEM

most experienced people in in forum know , but for the benefit of new to market members, a trading system is simply a set of rules using which you make your buy and sell decisions.

DISCRETION : it is very difficult to stick to a system, the reason is if you have a rule of 7% stop loss, then you have to sell at 7% loss , but over time you see the stocks you sold rallying 100% and 200%, so over time you start doubting the system and start using discretion, i always had a problem with SL's.

STATISTICAL ADVANTAGE

the reason you want to have a trading system, is you wanted to gain a statistical advantage, if you flip a coin you have 50% chance of being correct, but if you have to call correct face of the dice you have 1/6 chance of being correct. if you can come up with a system that can atleast give 55% chance of winning then you will make money long term and the more bets you place the more you will win. the idea is to have a statistical edge.

BIAS : once we start developing a system, when we start to see that we are not getting the expected output, then we get frustrated and when we see something very close , we get fixated and will try to rig the results by selectively altering the input. the formula is working fine for a index so we don't want to test it using any other data series.

i will follow ...

thanks
Srinivas

 

[raosrinivas]

there are some pseudo bulls in the forum who are actually bears but pretending to be bulls, be warned. now coming to my trading system experiment

i never do any intraday trading, i try to hold atleast for 3 months and want around 10 positions in the portfolio dividing the entire amount equally. i looked up the data for stocks that have gone up 100% and tried to deduce(if that is the correct word) a set of rules , that would have bought the position before it took off. a combination of rules that has criteria using Moving averages, volumes, momentum last 15 days, and confirmation(when all the conditions are met, wait for a no of days and buy. a system was built and i back tested the system with data from some stocks, it works. i never had the sell criteria, i thought of selling at discretion.

i employed the system and started buying at my portfolio did go up 10%, 2 out of the 10 had to be sold at a steep loss,but still overall i was very pleased, then many stocks started moving south and my portfolio cam don -3%. it took me some time to believe it but then again it went to +5% and i sold off every position.

then i executed the back-test using all stocks, and then i found that the system actually consistently produces a -2% on all positions, so i was lucky that i did not end up with losses in the real market. before employing the system i was testing the system on the stocks on my watchlist , which are generally better stocks. may be i was biased and i wanted to make the system work , tried rigging the backtest by selectively using the input data.

CONCLUSION: you are your best friend and worst enemy. assumptions and presumptions are very harmful, you will try to unconsciously rig your decisions based on your view.

 

[nansrired]

Does Anybody have a clue as to why sensex ended up by just 2 points when Dow Jones ended up by more than 400 points. I am banging my head but got no answer. Here one more thing most of the Asian markets and European markets ended positive.

If anybody has some information about this please post as i feel its very important for me to understand this phenomenon.

 

[raosrinivas]

Does Anybody have a clue as to why sensex ended up by just 2 points when Dow Jones ended up by more than 400 points. I am banging my head but got no answer. Here one more thing most of the Asian markets and European markets ended positive.

If anybody has some information about this please post as i feel its very important for me to understand this phenomenon.

It seems FII's have sold off $280 Million (net sell) today. as long as they are selling market will go down.

 

[jnj333]

Does Anybody have a clue as to why sensex ended up by just 2 points when Dow Jones ended up by more than 400 points. I am banging my head but got no answer. Here one more thing most of the Asian markets and European markets ended positive.

If anybody has some information about this please post as i feel its very important for me to understand this phenomenon.

Mainly because of poor IIP numbers.