Earn 15 lacs in 21 months with 1 lot of Minifty??
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Copied from CRN India site :
Do's and Donts of Intraday Trading
It seemingly looks to be the simplest and the most rewarding. But in intraday trading one has to be very fast and quick and have to be on your toes always, so there are certain rules which one has to keep in mind.
If index is in positive from yesterday and the share you are holding is in minus then it should be cut and if intraday trend of index is in buy then one should buy a stock in which is in plus.
If index is in minus then one should look to short stocks which are minus and not stocks which are in plus.
It is not necessary that a stock which is weak today during intraday trading might be weak tomorrow also, simultaneously if a stock is strong today might not be strong tomorrow
If US Markets have gone up overnight, the markets here in all probability will open strong, so one should be quite careful when buying stocks as the general psychology of public is to buy when good news is there.
Being a contrarians is very important while trading intraday.
Stop loss is a must while trading intraday.
Always trade in very liquid stocks i.e. which have very high volume because as entry and exit can be very fast in such stocks.
Do paper trading before you actually start trading so that when you start making paper profits, then shift to actual trading.
Keep your volume constant e.g.: if you trade in five lots of nifty future then trade in five lots only. This position can be increased only when you are satisfied with your trading for a month. It should not be that one day you buy five lots and next day you trade in ten lots and third day you get a loss and stop trading for two days.
Fear and Greed are at maximum levels while trading intraday so always have less position when you are new to intraday trading as otherwise you will be mostly under tension.
Do's and Donts of Intraday Trading
It seemingly looks to be the simplest and the most rewarding. But in intraday trading one has to be very fast and quick and have to be on your toes always, so there are certain rules which one has to keep in mind.
If index is in positive from yesterday and the share you are holding is in minus then it should be cut and if intraday trend of index is in buy then one should buy a stock in which is in plus.
If index is in minus then one should look to short stocks which are minus and not stocks which are in plus.
It is not necessary that a stock which is weak today during intraday trading might be weak tomorrow also, simultaneously if a stock is strong today might not be strong tomorrow
If US Markets have gone up overnight, the markets here in all probability will open strong, so one should be quite careful when buying stocks as the general psychology of public is to buy when good news is there.
Being a contrarians is very important while trading intraday.
Stop loss is a must while trading intraday.
Always trade in very liquid stocks i.e. which have very high volume because as entry and exit can be very fast in such stocks.
Do paper trading before you actually start trading so that when you start making paper profits, then shift to actual trading.
Keep your volume constant e.g.: if you trade in five lots of nifty future then trade in five lots only. This position can be increased only when you are satisfied with your trading for a month. It should not be that one day you buy five lots and next day you trade in ten lots and third day you get a loss and stop trading for two days.
Fear and Greed are at maximum levels while trading intraday so always have less position when you are new to intraday trading as otherwise you will be mostly under tension.
Hi guys,
I juz had a look at the discussion here and want to add a little bit of personal experience on nifty trading. The particular example I am mentioning is from the place where I work. The clients there trade on advice of a particular trader who is available for them through out the day on chat. Infact this place has a couple of advisors to whom they have subscribed. I will not mention their names, but many will be able to guess who they could be.
I joined them in Nov 2007. since then i have been watching it. clients juz follow the advice of the particular nifty trader(s). The clients were trading normal nifty (50 Lot)
In November made 450 points and lost 200. A nett gain of 250.
In december gained 300 and lost 480. a net loss of 180.
In January gained 2150 and lost 380. Net 1770.
In February gained 230 and lost 500 Nett loss 270.
In march gained 470 and lost 120. Net gain of 350
gains & losses mentioned are nett of brokerage & taxes.
Total gains 3600
total losses 1680
At the end of March 08 there is a Nett Profit of 1920 per lot.
That gives 1920x50=96000 per lot.
per month basis average gain is 384 points. the proposed 300 points is achievable.
We generally collect a margin of Rs.50,000/- from clients even though it was around 36-40k per lot to cover MTM losses etc.
This is something I never believed can happen. for me this was first hand experience. If managed well, stay tuned to what is happening and willing to take meaningful risk coupled with money management one can definitely make decent returns.
As for the discussion here, the said 300 points a month is easily achievable by many traders after taking into account a loss of 300 points every month. Traders generally freeze when they see a loss and books a profit too soon. If you are a day trader in nifty one can definitely make about 20-30 points after brokerage and losses. but then every trader is not disciplined and emotionless when they come to trade. most of them get carried away by what is happening around them and join the mad crowd.
Providing initial capital of 24k for a lot (20) is a wise decision rather than sticking to the actual 14-16k requirement. that way one can trade peacefully without worrying about overnight margin worries and catch the big move that happens next day. Money is made in those big moves. go for intraday if one is sure of what one is doing, otherwise enter the trade using simple TA which one can understand easily, implement and trade during the day without looking into charts everytime.
I welcome all Positive & Negative comments.
So please go ahead and start posting your comments.
May be we all can learn from it and prosper together.
Cheers!!!
Raja Krsnan
I juz had a look at the discussion here and want to add a little bit of personal experience on nifty trading. The particular example I am mentioning is from the place where I work. The clients there trade on advice of a particular trader who is available for them through out the day on chat. Infact this place has a couple of advisors to whom they have subscribed. I will not mention their names, but many will be able to guess who they could be.
I joined them in Nov 2007. since then i have been watching it. clients juz follow the advice of the particular nifty trader(s). The clients were trading normal nifty (50 Lot)
In November made 450 points and lost 200. A nett gain of 250.
In december gained 300 and lost 480. a net loss of 180.
In January gained 2150 and lost 380. Net 1770.
In February gained 230 and lost 500 Nett loss 270.
In march gained 470 and lost 120. Net gain of 350
gains & losses mentioned are nett of brokerage & taxes.
Total gains 3600
total losses 1680
At the end of March 08 there is a Nett Profit of 1920 per lot.
That gives 1920x50=96000 per lot.
per month basis average gain is 384 points. the proposed 300 points is achievable.
We generally collect a margin of Rs.50,000/- from clients even though it was around 36-40k per lot to cover MTM losses etc.
This is something I never believed can happen. for me this was first hand experience. If managed well, stay tuned to what is happening and willing to take meaningful risk coupled with money management one can definitely make decent returns.
As for the discussion here, the said 300 points a month is easily achievable by many traders after taking into account a loss of 300 points every month. Traders generally freeze when they see a loss and books a profit too soon. If you are a day trader in nifty one can definitely make about 20-30 points after brokerage and losses. but then every trader is not disciplined and emotionless when they come to trade. most of them get carried away by what is happening around them and join the mad crowd.
Providing initial capital of 24k for a lot (20) is a wise decision rather than sticking to the actual 14-16k requirement. that way one can trade peacefully without worrying about overnight margin worries and catch the big move that happens next day. Money is made in those big moves. go for intraday if one is sure of what one is doing, otherwise enter the trade using simple TA which one can understand easily, implement and trade during the day without looking into charts everytime.
I welcome all Positive & Negative comments.
So please go ahead and start posting your comments.
May be we all can learn from it and prosper together.
Cheers!!!
Raja Krsnan
Hello Seniors:
Consider this scenario. We start trading with 1 lot in Minifty Fut (investment/deposit of 24,000). We get a monthly gain of 300 points (i.e. 300 x 20 = 6000 in profit). We do this for 3 more months. In the 5th month (6000 x 4 = 24000), we trade with 2 lots, etc. Please see the excel sheet attached.
Extending the above, in 21 months, we will have a profit of 15 lacs + your investment of 24,000.
As you would have rightly guessed from the above ambition, I am a newbie.
Now, how far this is possible? How easy or difficult is it to maintain +300 points monthly. Is it a reasonable target to achieve and achieve every month? I plan to trade with a 20 point stop loss, is it a good idea?
What would be your advice to me?
Consider this scenario. We start trading with 1 lot in Minifty Fut (investment/deposit of 24,000). We get a monthly gain of 300 points (i.e. 300 x 20 = 6000 in profit). We do this for 3 more months. In the 5th month (6000 x 4 = 24000), we trade with 2 lots, etc. Please see the excel sheet attached.
Extending the above, in 21 months, we will have a profit of 15 lacs + your investment of 24,000.
As you would have rightly guessed from the above ambition, I am a newbie.
Now, how far this is possible? How easy or difficult is it to maintain +300 points monthly. Is it a reasonable target to achieve and achieve every month? I plan to trade with a 20 point stop loss, is it a good idea?
What would be your advice to me?
Dear friend,
Your XLS spread sheet looks very sweet.
But the real scenario will always different.
What you said is like seeing a cricket match in which Sachin got out in 99, and as a spectator you may think that Sachin should not have tried that shot
in which he got out. Your calculations is like a spectator and the real trader is Sachin. My intention is not to dishearten you, but it depends what is your plan of trade. Out of 20 trading days you may have to book loss in atleast five trades. You must learn to lengthen your profits and book loss earliest.
These are the trading techniques which will keep you and investments in the market. First learn the technicals , like moving averages,trend lines etc., for intraday trade you must have atleast 3 months earlier data , so that where the resistance and support levels are.without these data you may BUY at resistance and SELL at support, which eventually will EAT all your investments.
happy niftying
regards
Akasthyar
Dear Raj,
The target of 300 NIfty points per month is achievable if one follows day trading ( with no overnight LOng/Short positions ) with strict stoploss. By carrying no Long/Short positions one certainly losses out ,but he can lot of peace. Sometimes Nifty gains /losses just 5 or 10 points but if you see on intraday basis this may be 50 points.
The target of 300 NIfty points per month is achievable if one follows day trading ( with no overnight LOng/Short positions ) with strict stoploss. By carrying no Long/Short positions one certainly losses out ,but he can lot of peace. Sometimes Nifty gains /losses just 5 or 10 points but if you see on intraday basis this may be 50 points.
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