why 95% lose
- Thread starter XRAY27
- Start date
Since Discussion is going on very healthy mode. For simply learning -Phantom of pit - is very good.
When 1st time i learnt trading is a business ,where rules r different in various ,it gives me good up.
When later , i change 40% wrong- is OK,so i am ready for them ,also out of 60% right, half ie. 10 out of 3, will give chance to add , i have no problem -to earn in market.
So at start of simple trade set up, after my entry, i wait since by price it guide me to be wrong, and then when Right , -i get a scope to add or not. Rule is its showing strong momentum ,- instead of profit booking i add.
A simple 5/20 ma x , helps me some bias. Only check i do nifty Vs $/inr inverse relation . Today its telling , very little volatility , so i dont take trade.
As i am poor hedger, only directional player - i can not take no probability trade.
Price action/Candle/Higher time frame r my imp Odd Enhancer.
,,,,,,,,,,,,,,,,,,,
I always read psychology ,as without it, i go back to my habits of impulsive momentum trade, so i watch pivot , price action near to it to get direction.
So no high probability, No trade.If market can move bothway , i wait.
.......................
Without understanding context, TA is more harmful to a trader.But when u can understand the intricacy - like pattern failure, sector rotation , gap filling , Trap- its worth than a house in mumbai.
When 1st time i learnt trading is a business ,where rules r different in various ,it gives me good up.
When later , i change 40% wrong- is OK,so i am ready for them ,also out of 60% right, half ie. 10 out of 3, will give chance to add , i have no problem -to earn in market.
So at start of simple trade set up, after my entry, i wait since by price it guide me to be wrong, and then when Right , -i get a scope to add or not. Rule is its showing strong momentum ,- instead of profit booking i add.
A simple 5/20 ma x , helps me some bias. Only check i do nifty Vs $/inr inverse relation . Today its telling , very little volatility , so i dont take trade.
As i am poor hedger, only directional player - i can not take no probability trade.
Price action/Candle/Higher time frame r my imp Odd Enhancer.
,,,,,,,,,,,,,,,,,,,
I always read psychology ,as without it, i go back to my habits of impulsive momentum trade, so i watch pivot , price action near to it to get direction.
So no high probability, No trade.If market can move bothway , i wait.
.......................
Without understanding context, TA is more harmful to a trader.But when u can understand the intricacy - like pattern failure, sector rotation , gap filling , Trap- its worth than a house in mumbai.
Few attitudes that screw ton of new traders:
* Lets double the money in X months and go shopping for a private jet in 3X months.
* Its all buy low, sell high and price can go up or down, so how can this be tough!?
* Discipline and psychology: This time its different, lets take a jackpot trade (or revenge trade or piling loss trade) which is clearly a No-No trade as per system and risk management policies. Failing to pull the trigger and endlessly analyzing the situation.
All the above attitudes are result of searching for a short cut to success, it only cuts short once trading life. Am still suffering from 3rd point.
* Lets double the money in X months and go shopping for a private jet in 3X months.
* Its all buy low, sell high and price can go up or down, so how can this be tough!?
* Discipline and psychology: This time its different, lets take a jackpot trade (or revenge trade or piling loss trade) which is clearly a No-No trade as per system and risk management policies. Failing to pull the trigger and endlessly analyzing the situation.
All the above attitudes are result of searching for a short cut to success, it only cuts short once trading life. Am still suffering from 3rd point.
1. I don't know if it 5% or 20%. But whatever may be the number the fact is, many traders will lose money and it cannot be avoided. The idea that everyone can make money is impossible. Everyone making money means there is no market, because who would be taking the other side of the trade?
2. There is a deeper reason as to why most traders will lose regardless of what methods they employ. It is not about money management, risk management, bad government policies, world events etc.. It is because they are part of the crowd (95%) and they do not have their own system.
3. Successful traders find something that works and stick to it, not letting others pull them away from their strategy. This is where most traders go wrong and why the crowd loses money.
4. Most of the trends is created by professional money managers who are managing trillions of dollars in assets. They normally start the Trend early and will be the first to get out. The point is the Trend was not started by the crowd but by the 5% who had enough money.
5. So the simple answer is, For you to win(be part of 5%) in the market, Do not follow the crowd (95%) and follow your system which works. And mostly you will have to take a Contrarian view. People will laugh at you, Will make fun of you. But you will have to learn to stick to your system, whatever happens. For that first of all you should also have a system which you believe will work.
Note: As Gandhi said, "Even if the whole world is against you, you should have the courage to stand alone for what you believe". Like Gandhi believed that Non-violence will work when everybody believed on Guns and nobody believed non-violence could work. I personally not a great fan of Gandhiji. So please do not start a war on Gandhiji and non-violence. It was just a point to illustrate that Gandhiji was firm on his decision and stuck to it, even when the whole world was against his ideology because during his times non-violence was not something which was proved to be working.
2. There is a deeper reason as to why most traders will lose regardless of what methods they employ. It is not about money management, risk management, bad government policies, world events etc.. It is because they are part of the crowd (95%) and they do not have their own system.
3. Successful traders find something that works and stick to it, not letting others pull them away from their strategy. This is where most traders go wrong and why the crowd loses money.
4. Most of the trends is created by professional money managers who are managing trillions of dollars in assets. They normally start the Trend early and will be the first to get out. The point is the Trend was not started by the crowd but by the 5% who had enough money.
5. So the simple answer is, For you to win(be part of 5%) in the market, Do not follow the crowd (95%) and follow your system which works. And mostly you will have to take a Contrarian view. People will laugh at you, Will make fun of you. But you will have to learn to stick to your system, whatever happens. For that first of all you should also have a system which you believe will work.
Note: As Gandhi said, "Even if the whole world is against you, you should have the courage to stand alone for what you believe". Like Gandhi believed that Non-violence will work when everybody believed on Guns and nobody believed non-violence could work. I personally not a great fan of Gandhiji. So please do not start a war on Gandhiji and non-violence. It was just a point to illustrate that Gandhiji was firm on his decision and stuck to it, even when the whole world was against his ideology because during his times non-violence was not something which was proved to be working.
........................................................
Detail is ton worthy writing ,only hints r given. (No fund manager tells it, as its their bread & butter)
1] Market up starts with banking sector.
2] Cement/steel - 1st sign of economic boom. followed by infra structure.
3] when transport works , infra structure ok- Power sector moves.
4] then starts consumerism - FMCG etc. Common people think of bull market .
5] official growth factor data publish - future looks bright . hotel/tourism moves.
6] With money flow automobile sales up- the sector moves up.
7] All looks good - service provider IT/pharma moves & shifts money as doller appreciated. So safe money starts to move out- dumping to fools.
8] money moves from stock to fixed/Gold etc .
9] Report some problems by media- common people understand , though some corrected - still continue slow price fall.
10] people understand recession/inflation - but broking is still ok( as short possible)- Pharma fund / FMCG in demand as defensive -all r dumped.
...........................
Again a good hope brings up some yrs later.
IF U LOOK SECTOR ,AS MENTIONED IN NSE/BSE AGAINST WEEKLY CHART OF INVERSE CORRELATION up vs down - u can get , this intermediate term trade plan .
for intraday it not suits, some think misnomer - pair trading , for upbias buy/ equal value down bias SELL .
Hope it helps.
Detail is ton worthy writing ,only hints r given. (No fund manager tells it, as its their bread & butter)
1] Market up starts with banking sector.
2] Cement/steel - 1st sign of economic boom. followed by infra structure.
3] when transport works , infra structure ok- Power sector moves.
4] then starts consumerism - FMCG etc. Common people think of bull market .
5] official growth factor data publish - future looks bright . hotel/tourism moves.
6] With money flow automobile sales up- the sector moves up.
7] All looks good - service provider IT/pharma moves & shifts money as doller appreciated. So safe money starts to move out- dumping to fools.
8] money moves from stock to fixed/Gold etc .
9] Report some problems by media- common people understand , though some corrected - still continue slow price fall.
10] people understand recession/inflation - but broking is still ok( as short possible)- Pharma fund / FMCG in demand as defensive -all r dumped.
...........................
Again a good hope brings up some yrs later.
IF U LOOK SECTOR ,AS MENTIONED IN NSE/BSE AGAINST WEEKLY CHART OF INVERSE CORRELATION up vs down - u can get , this intermediate term trade plan .
for intraday it not suits, some think misnomer - pair trading , for upbias buy/ equal value down bias SELL .
Hope it helps.
Here is one useful information .... Ofcourse many may disagree.... Have an capital of 2 lacs. Trade ONLY Copper/Calander spread hedge... DO NOT put any other Commodity on the trading watch list...Strictly NO EXPOSURE LIMIT. Trade only 4 lots at a time..So,effectively using only one lac approximately at any point of time.. Watch the magic and enjoy!! I am doing since last five years..
Here is one useful information .... Ofcourse many may disagree.... Have an capital of 2 lacs. Trade ONLY Copper/Calander spread hedge... DO NOT put any other Commodity on the trading watch list...Strictly NO EXPOSURE LIMIT. Trade only 4 lots at a time..So,effectively using only one lac approximately at any point of time.. Watch the magic and enjoy!! I am doing since last five years..
in MCX i guess no options are possible ....only futures are available ...am i right?
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