Priyanvada's chit chat home ...
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Yes...Perfectly Right 
... I think so ... any master in the field will term this process as accumulation ... If the trader is retired from trading job, then we can then decide he has made money or not...
... It is all related to timeframe ... See Initially I entered with big amount ... Risked all and made some good amount one day ... the next day I am feeling confident and again risked all and lost double the first day ... So ... So ... So what do you think I will have on third day... or "N"th day...?
At the End of "N" days,
My Account status = Initial amount + Sigma (i = 1 to N) {Profits (i)}
... here as we see,
1. Initial amount = Constant
2. Sigma(bla bla bla!) = This is the term which is going to decide whether you are going to be smiling on "N"th day ...or Sad on "N"th day ...
... So simple logic says, If I wanna make sigma(bla bla bla) positive and big, I must make Profits (i) as big as I can ... So Now,
Profit(i) = function (Amount you Risk on "i" day)
Profit(i+1) = function (Amount you Risk on "i+1" day)
... So this all looks very straightforward to our brain ... and the most important thing which slips out from our eyes is ...
(Amount you Risk on "i+1" day) = function {Profit(i)}
.... In case you make profit "i"th day, Then you are IN. But in case you made a loss on "i"th day you are doooomed!... because on (i+1)th day, you are not going have Risk amout equal to Risk amout on ith day!
Example: - Say you have 10000 Capital ...
Case 1: -
1. On day 1 you risked all and made 10% = 1000 Rs. ...
2. On day 2 you risked all but made 10% loss = 11000*.9 =9900!
Case 2: -
1. On day 1 you risked all but made 10% Loss = -1000 Rs.
Capital = 10000 - 100 = 9000
2. On day 2 you risked all but made 10% profit = 9000*1.1 = 9900!
... So you see in both cases your performance was 50-50,
So at end of second day if you see clearly and honestly,,,
1. You have performed well 50-50 in terms of profit and loss but..
2. The capital at the end of third day you are short 100Rs.,,,, and you are puzzled where this 100Rs. has vanished!...
3. You have TOTALLY wasted 2 days and although performing equal in terms of profit and loss,,, You are at Overall loss on the final day!
... So this overall trading model is very favorable to make loss...it is not fair and equal and straighforward as we think it,,, and thats why I was praising the line,...
Traders obejective should not be making money but to accumulate it!
I hope you got something I am trying to say here...
regards,
priyanvada
... I think so ... any master in the field will term this process as accumulation ... If the trader is retired from trading job, then we can then decide he has made money or not...... It is all related to timeframe ... See Initially I entered with big amount ... Risked all and made some good amount one day ... the next day I am feeling confident and again risked all and lost double the first day ... So ... So ... So what do you think I will have on third day... or "N"th day...?
At the End of "N" days,
My Account status = Initial amount + Sigma (i = 1 to N) {Profits (i)}
... here as we see,
1. Initial amount = Constant
2. Sigma(bla bla bla!) = This is the term which is going to decide whether you are going to be smiling on "N"th day ...or Sad on "N"th day ...
... So simple logic says, If I wanna make sigma(bla bla bla) positive and big, I must make Profits (i) as big as I can ... So Now,
Profit(i) = function (Amount you Risk on "i" day)
Profit(i+1) = function (Amount you Risk on "i+1" day)
... So this all looks very straightforward to our brain ... and the most important thing which slips out from our eyes is ...
(Amount you Risk on "i+1" day) = function {Profit(i)}
.... In case you make profit "i"th day, Then you are IN. But in case you made a loss on "i"th day you are doooomed!... because on (i+1)th day, you are not going have Risk amout equal to Risk amout on ith day!
Example: - Say you have 10000 Capital ...
Case 1: -
1. On day 1 you risked all and made 10% = 1000 Rs. ...
2. On day 2 you risked all but made 10% loss = 11000*.9 =9900!
Case 2: -
1. On day 1 you risked all but made 10% Loss = -1000 Rs.
Capital = 10000 - 100 = 9000
2. On day 2 you risked all but made 10% profit = 9000*1.1 = 9900!
... So you see in both cases your performance was 50-50,
So at end of second day if you see clearly and honestly,,,
1. You have performed well 50-50 in terms of profit and loss but..
2. The capital at the end of third day you are short 100Rs.,,,, and you are puzzled where this 100Rs. has vanished!...
3. You have TOTALLY wasted 2 days and although performing equal in terms of profit and loss,,, You are at Overall loss on the final day!
... So this overall trading model is very favorable to make loss...it is not fair and equal and straighforward as we think it,,, and thats why I was praising the line,...
Traders obejective should not be making money but to accumulate it!
I hope you got something I am trying to say here...
regards,
priyanvada
And you say you are newbie to the market ? No way !
Haaaa ......I WAS WAITING for someone to FLATTER me like that...
...Really thanks but this is just my shocking understanding after 7000Rs. Initial loss.....Ohh really...you have to believe this!...
A month ago, I had actually got in with the mindset, just bet on something moving up and more than 50% probable it will move up!...So how in the world I can lose money here?? ... Impossible!!!...only way was becomming too greedy for upward movement ...which is not the case with my mind ... I am not greedy at all ... So I was sure there is NO CHANCE that I can lose ... And As the time pass, I WILL be in more and more profit and very soon I will be having lakhs in my bag ... I had calculated everything in Excel!... hohoho! This is so funny...
...but alas ... I acctually made consistent loss ...
... Then in the mean time, suddenly my eyes opened!
So anyway.......
... You see there, what I have written there is also not 100% right!...
(Amount you Risk on "i+1" day) = function {Profit(i)}
... This is absolutely wrong... Correct would have been,...
(Amount you Risk on "i+1" day) = function{Sigma {Profit(i)}}
This looks correct but still I am not sure ... I don't know how represent an element in the flow as a function of previous history...
... So anyway it is a 12th science math and I am not able to model the trading process correctly ... I will be happy to see if someone has done this already
...
i am a perfect newbie... believe me!...It was that Only last week that I have made some 650Rs. Net profit!
... Now I am in much hope that I will finally learn to swim here!
regards,
priyanvada
...Really thanks but this is just my shocking understanding after 7000Rs. Initial loss.....Ohh really...you have to believe this!...
A month ago, I had actually got in with the mindset, just bet on something moving up and more than 50% probable it will move up!...So how in the world I can lose money here?? ... Impossible!!!...only way was becomming too greedy for upward movement ...which is not the case with my mind ... I am not greedy at all ... So I was sure there is NO CHANCE that I can lose ... And As the time pass, I WILL be in more and more profit and very soon I will be having lakhs in my bag ... I had calculated everything in Excel!... hohoho! This is so funny...
...but alas ... I acctually made consistent loss ...
... Then in the mean time, suddenly my eyes opened!
So anyway.......
... You see there, what I have written there is also not 100% right!...
(Amount you Risk on "i+1" day) = function {Profit(i)}
... This is absolutely wrong... Correct would have been,...
(Amount you Risk on "i+1" day) = function{Sigma {Profit(i)}}
This looks correct but still I am not sure ... I don't know how represent an element in the flow as a function of previous history...
... So anyway it is a 12th science math and I am not able to model the trading process correctly ... I will be happy to see if someone has done this already
...
i am a perfect newbie... believe me!...It was that Only last week that I have made some 650Rs. Net profit!
... Now I am in much hope that I will finally learn to swim here!
regards,
priyanvada
I am getting into a new habit ...
Always consider a movement against your position as double the same!
Example: -
If I bought a stock at 100Rs. and the its price goes down to 99Rs. I think it as 98! ...
Since I never put stoploss to any position (my weakness), due to above considertion my mind is making better exit ... actually it makes exit on two criterias ...
1. Based on against movement as stated above
2. Based on time period ... if it is taking too much time to move from a position, I just squreoff without profit or loss and accept the brokerage penalty
regards,
priyanvada
Always consider a movement against your position as double the same!
Example: -
If I bought a stock at 100Rs. and the its price goes down to 99Rs. I think it as 98! ...
Since I never put stoploss to any position (my weakness), due to above considertion my mind is making better exit ... actually it makes exit on two criterias ...
1. Based on against movement as stated above
2. Based on time period ... if it is taking too much time to move from a position, I just squreoff without profit or loss and accept the brokerage penalty
regards,
priyanvada
The real tragedy of a day trader like mine is there happens a sudden price jump or decline --say in 5 minutes -- in five or more random stocks and in very very tiny amount of time ...
See todays example below ...
price jump was just within 5 minutes from 10:35 to 10:40 ... and at 10:39 I noticed this and still rubbing my hands in anger ...
Many many times I have observed this ... and still can't understand what is the cause of this "Sudden madness" from buyers???
Day traders life is not that easy!
See todays example below ...
price jump was just within 5 minutes from 10:35 to 10:40 ... and at 10:39 I noticed this and still rubbing my hands in anger ...
Many many times I have observed this ... and still can't understand what is the cause of this "Sudden madness" from buyers???
Day traders life is not that easy!
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