SH's 315 Strategy - how to use if effectively

[forestflower]

It is not the critic that counts,not the man who points out how the strong man stumbled,or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena,whose face is marred by dust, sweat and blood,who strives valiantly and errs and who with great enthusiasm and great devotion spends himself in the worthy cause,who at best knows acheivement and who at worst if he fails at least fails while daring greatly so that his place shall never be with those cold and timid souls who know neither victory nor defeat
THEODORE ROSEVELT

 

[mmca2006]

Dear TJ friends and traders,

I have written about 315 strategy at different places in the past and I started writing this thread in July 09 here. In the last 6 months I have spent a lot of time here trying to explain, demonstrate, fine tune and at the same time learn more about this strategy myself with you all.

I started posting live trades here as per 315 since November since I firmly believe any theory not backed up by practical demonstration is like saying we have a billion stars without any ways to prove it. I believe,largely, people enjoyed this live trading with me. I wanted to stop mid way somewhere but people urged me to continue it and I agreed.

Today as the year ends, I believe I have been successful to build some good understanding of this strategy amongst the traders here. In the process of doing this, I made some good friends here and also earned some critics. I thank everyone here for whatever time they have spent on this thread for I have learned with each answer I gave out to queries.

I also apologise to my critics for showing my human side and probably hurting them back while they hurled their accusations at me.

Like all good things have to end somewhere, I believe this is the end of my posting live trades here from hereon. I will still be around to answer any genuine queries.

Best of luck with your trading and have a blast in 2010.

Cheers
SH :thumb:

SH,
Since inception I am following this thread , I did not find any thing wrong in your strategy ,but today I found wrong in your decision , of course no body likes to degrade himself, his strategy , self respect must be there. But same time you should also consider the feeling of other fellow members who are following the strategy gifted by you , very few person usually provides his/ her personal strategy and you are one of them . So I am requesting you to reconsider your decision for the benefit of followers of your strategy.Please go back to previous 68 pages of this thread ,you witness how many member has shown interest in your system, please don't dishearten them.
Happy new year .

 

[forestflower]

Dear SH,
THE Docomo ad says "why walk alone when we can dance together"
You say that you wanted to continue the sharing part but the mud slinging has made you reconsider your decision.
Then you are my friend producing exactly the result your detractors yearned for out of this banter.Inspite of having proved them wrong the net outcome would be their victory. I think you need to deny them this pleasure.And it's not about victory or defeat,it's about standing by your convictions, that's the larger issue at stake here.It's about our character, whether we are mentally organised enough to accord importance to things we think deserve importance and chuck the rest.My concern is if we allow mindless criticism/opposition to effect us than our choices will always be controlled by others.We give them that power over us.
Freedom is the greatest yearning of mankind since inception.The ability to remain free of other people's opinion of you and about you is spiritually progressive.
Strenth is not an object we possess, it's a relationship we have with the world.To be truly strong requires nothing of the world.
Desirelessness is a very powerful state of mind. Exibit that my freind, because you have it in you.
Like a class batsman we should be ready for anything that is thrown at us and respond effectively.A wise had said that "the only way not to have enemies is to fail".In our society only the dead are praised as they are no more a threat or competative. As long as you are productive there will be people wanting to have a piece of you, it's a sign that you are effective.
Please appreciate that by doing what your detractors wanted you to do, you are penalising your well wishers and rewarding your critics. IRONICALL I say.
Please continue your good work and remember what RATI AGNIHOTRI said in
'EK DUJE KE LIYE': " ULFAT KE DUSHMANNO NE KHOSHISH HAZAAR KE,PHIR BE NAHI ZUKI JO US NAZAAR KO SALAAM"
My apologies if I have gone overboard here.

And like you say "CHEERS' and let the good times roll buddy.

THANKS

 

[kkr555]

I like the option strategy to preserve profits - but there is a gotcha as well

Hypothetical example (No way connected with today's price quotes) :

Sometime back you bought NF at 5000 on a bullish 3/15 crossover. Today, NF trades at 5200 and you are having a 200 point profit. So as per this strategy, to book your 200 point profit in NF, you sell NF at 5200. As per this option strategy, you buy a 5200 CE at Rs 140.

Yet again assume,

15 day EMA is around 5000.

So our strategy here would be to close your 5200 call and then buy back NF as soon as it touches 15 day EMA at 5000.

But as your luck would have it, NF is extremely bullish and never touches the 15 day EMA even once. Upon expiry, NF closes at 5200 (tough luck eh!). So you end up losing your entire 5200 CE premium of Rs 140 upon expiry. This is also a whipsaw of a different sort.

SH, How does one handle such a scenario ?

This is a really wise advice Rk Karnani, this is exactly how to go about with any strategy. Test it, paper trade it, start with small quantities in real world and increase your trade since gradually if system is giving profits.

By the way, I can give you another suggestion here to protect the capital and some profits here .. you can accept that or ignore it based on your trading style.

When your positions are 150-200 points in profit, close your Nifty Futures and book profits. Out of that profit ... buy at the money option ('Call' if the 315 is bullish & 'Put' if 315 is bearish). They usually trade at 140-150 points at the start of the month and you can get it cheaper if your are doing it in the middle of the month .....This way your entire risk in mkts is the profit you have already made in the trade.

If the trend is strong, even your options will earn profits.. if its weak and has to whipsaw.. you will be able to exit that option for 50% of its value (remember that 50% is still your profit)... and at crossover start afresh with NIfty futures.

This is again one innovation/common sense one can take to preserve capital and preserve profits (IF my positions are 500 points in profit.. I would not leave all that on the table, I usually get into options immediately).

By this, probably the annual returns would become 150% from 300% ... but even the risk goes down significantly.

Cheers
SH

 

[VJAY]

Dear Tradewithhunter,
Wishing you a happy & prosperous new year-2010...Am new to this thread....I liked your strategy...looking to papertrade it...have some doubts please reply..
1.We enter trade at closing....looking the crossover...if it ema crossover is just happen @EOD then can we wait for next day or enter it immediately?
2.Add comes when price go towards our trade then reverse to touch 15ema...here we wait for complete the bar which touches 15 ema or at touching price?
3.same doubt when we exit the trade if price not touch 3 ema and then reenter when price touches 3 ema again.......here also wait for last minute of that day or enter it when price touch 3 ema?

 

[Tradewithhunter]

Dear SH,
" ULFAT KE DUSHMANNO NE KHOSHISH HAZAAR KE,PHIR BE NAHI ZUKI JO US NAZAAR KO SALAAM"

Dear Forestflower,

Only if I had a 'salute' icon here .. I would have filled this space with those icons.. all salute to you sir... (i dont know you, your age, your nationality, your location.. but i know you are one hell of a motivator!!)

It will be fantastic if ever I could get a chance to meet you or speak to you .. your rock man !!

:thumb:

SH

 

[Tradewithhunter]

I like the option strategy to preserve profits - but there is a gotcha as well

Hypothetical example (No way connected with today's price quotes) :

Sometime back you bought NF at 5000 on a bullish 3/15 crossover. Today, NF trades at 5200 and you are having a 200 point profit. So as per this strategy, to book your 200 point profit in NF, you sell NF at 5200. As per this option strategy, you buy a 5200 CE at Rs 140.

Yet again assume,

15 day EMA is around 5000.

So our strategy here would be to close your 5200 call and then buy back NF as soon as it touches 15 day EMA at 5000.

But as your luck would have it, NF is extremely bullish and never touches the 15 day EMA even once. Upon expiry, NF closes at 5200 (tough luck eh!). So you end up losing your entire 5200 CE premium of Rs 140 upon expiry. This is also a whipsaw of a different sort.

SH, How does one handle such a scenario ?

KKR - at 5200 you book 200 point profit, you buy 5200 CE at 140 and hold. As you say if NF is extremely bullish ..why would it expire at 5200... It will have to go upto 5400 if its extremely bullish? At 5400 you again book 100-120 points profit in 5200 CE and buy one lot 5400 CE for around 100 .. let NIfty expire at 5200 then ... you would have still booked 180-200 points profit .. what say? (advantage options !!)

Lets assume, scenario 2 ,at 5200 you book 200 point profit, you buy 5200 CE at 140 and hold. Then bearish crossover happens at 4950 before expiry .. you will be able to salvage 30-40 points in 5200 CE and immediately short Nifty in futures. (In this case you are still able to book 40 odd points profit whereas if you were trading only in futures you would have had a loss on 50 points as soon as nifty whipsawed and SAR got hit at 4950..advantage options!).

Lets assume scenario 3, at 5200 you book 200 point profit, you buy 5200 CE at 140 and hold. Nifty immediately starts correcting and touches 15 EMA at 5000. Here instead of buying Nifty futures, you buy one more lot 5100 CE for 60 points (and continue holding the previously bought 5200 CE). Remember this 60 points are leftovers from the 200 points profit you booked earlier in futures.

NOw here for 200 points you now hold 1 lot of 5200 CE and 1 lot of 5100 CE Now if Nifty expires below 5200 .. so be it, you have lost nothing. But if Nifty bounces from 15 EMA and reaches 5200 again before expiry .. your 5100 CE would become 140 -150 & your 5200 CE would become 100 again .. you now have 250-300 point profit.. book both and buy next months 5200 CE again .. (advantage options!) However IF Nifty expires at 5200 .. you still get 100 points as profit in 5100 CE (this is where you are at disadvantage since you get only 100 points whereas if you had futures you would have had 400 points profit)

As i said earlier, using options will have its own advantages and some disadvantages over pure future trading.


Cheers
SH

 

[Tradewithhunter]

Dear Tradewithhunter,
Wishing you a happy & prosperous new year-2010...Am new to this thread....I liked your strategy...looking to papertrade it...have some doubts please reply..
1.We enter trade at closing....looking the crossover...if it ema crossover is just happen @EOD then can we wait for next day or enter it immediately?
2.Add comes when price go towards our trade then reverse to touch 15ema...here we wait for complete the bar which touches 15 ema or at touching price?
3.same doubt when we exit the trade if price not touch 3 ema and then reenter when price touches 3 ema again.......here also wait for last minute of that day or enter it when price touch 3 ema?

Dear Vjay - I have answered these questions several times in the past. I know the answers are lost in so many pages now. I will again answer these for you.

1. Enter it immediately. If cant enter today, enter tomorrow morning.

2. ADD at touching the 15 EMA if your original positions is already in good profits OR if you are a high risk high returns aggressive trader. If original position not in good profit, dont ADD (what is good? I would say 100-150 Nifty points).

3. 3 EMA rule is simple... re-enter when you see 3 EMA touch. However you will see that as Nifty falls 3 EMA will also fall. so you can sometimes not wait until a 3 EMA kiss but enter 10-15 points higher than 3 EMA (this is becuase if NIfty reverses from that point and goes up you will find 3 EMA is pulled up and it kisses the candle at your entry point).

Cheers
SH

 

[Tradewithhunter]

SH,
Since inception I am following this thread , I did not find any thing wrong in your strategy ,but today I found wrong in your decision , of course no body likes to degrade himself, his strategy , self respect must be there. But same time you should also consider the feeling of other fellow members who are following the strategy gifted by you , very few person usually provides his/ her personal strategy and you are one of them . So I am requesting you to reconsider your decision for the benefit of followers of your strategy.Please go back to previous 68 pages of this thread ,you witness how many member has shown interest in your system, please don't dishearten them.
Happy new year .

Dear MMCA - thanks for your kind comments.

I see a lot of people have liked the system and they have even rated this thread as '4' star (only 5 votes though out of which 1 is mine

Those are the people I am greatful to and they have kept me going this far. As i said, I will continue to address all queries here and will be around always

Cheers
SH

 

[forestflower]

Dear Forestflower,

Only if I had a 'salute' icon here .. I would have filled this space with those icons.. all salute to you sir... (i dont know you, your age, your nationality, your location.. but i know you are one hell of a motivator!!)

It will be fantastic if ever I could get a chance to meet you or speak to you .. your rock man !!

:thumb:

SH

Dear SH,
True freinds are like stars. You don't always see them ,but you know they are there.
Thanks for the kind words,It's an honor SH.Since joining in augest I have only observed and absorbed.I hold in high regard people like you who share their wealth of knowledge with others.Criticising or pointing out aspects which according to one's perception are fallacies, is within one's right and part of well-meaning discussion. But to take it to the level of subjugation is undemocratic.But such is the duality of life,the interlinking of good and bad, right and wrong, so very natural to itself.It would be a great loss to the trading community if people like you feel wronged and move away.
SH, I believe that whenever we are shown disregard,we need to check ourselves. If we have done no wrong and our intentions are well-meaning,we then need to take that situation as a test of our abilities to remain beyond the jugdement of others.
I am sure the support and love you have received has got you back in the groove. It would great to meet or speak with you buddy.

Thanks and "cheers"

P.S. The meeting of two personalities is like the coming together of two chemical substances. If there is a reaction, both are transformed.