The Key Signals of a Tiring Market

A successful self trader – Rule # 47

A tiring market is when the domination is gradually slipping out of the hands of the bulls. A tiring market is a signal to cut long positions and also a signal to initiate short positions in the market. Just as a lackluster market indicates a grinding bottom, similarly a tiring market indicates a grinding top. You must know the 6 signals that can confirm that the market is tiring and the tide is turning. Continue reading

Always Have Your Plan-B In Place

A successful self trader – Rule # 46

This rule is an extension of the previous discussion on market panics. Any decision must be taken with a plan-b. Remember, plan-B becomes relevant when your decision goes against you. When your decision goes right, your rulebook is good enough. But, do you have plan-b for macro shocks, global uncertainty, monetary tightening, sharp corrections and basket-selling? Continue reading

Don’t Let Taxes Drive Your Decisions

A successful self trader – Rule # 45

It is a common belief that your investments should be tax-efficient. Remember, taxes should never ever drive your investment strategy. Investing should always be a risk-return trade-off. If you get tax benefits in the form of exemptions or lower tax rates, it is just the icing on the cake. The danger here is that a tax-based strategy can lead to wrong allocation and bad investment decisions. Continue reading

How to Set Your Stop Loss in Trading?

A successful self trader – Rule # 44

Stop loss is one of the critical pillars of equity trading and investing. You trigger a stop loss when the price movement goes against you. Your stop loss is normally determined by two factors viz. What the technical charts suggest and how much loss you can afford. A trade without a stop loss is like a life without insurance. The benefits may not be visible but the risks of not having it can be humungous… Continue reading

The buck stops with you, and you alone

A successful self trader – Rule # 43

Whether you are trading or investing; the buck always stops with you. Once a decision is taken you need to take accountability for the same. You cannot pass on the blame to extraneous factors. It just doesn’t work that way. You need to answer 2 questions. Why do i want to buy at this price and why does someone else want to sell at this price. Once you grasp the other side, you can be fully answerable for your decisions. Continue reading

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