Trading Rule – “Beware the Risk of Selling Options”…

Selling options has limited upside and unlimited downsides. If you thought people must be crazy to sell options, think again! 95% of all options expire worthless. That means, in 95% of the cases, it is the seller of the option who makes money. But selling options is for the experts. If you try selling options without knowing the downside risks, it could spell disaster for you. Watch out! Continue reading

Trading Rule – “Don’t be in a hurry to bottom-fish stocks”…

There is something seductive and buffettian about bottom fishing for stocks. It is the dream of every trader to buy at the bottom and sell at the top. In practice, though, it rarely happens. P/E and valuations are just a plain theoretical approach to buy stocks of deep value. In reality, the time for bottom fishing is when the last optimistic bull has been squeezed out of the markets.
Continue reading

Trading Rule – “Go, get the power of online trading”…

Online Trading has redefined the contours of Broking in more ways than one. It has brought about transparency in an otherwise opaque industry. It has made the entire broking value chain from order placement to confirmation to Demat credit absolutely seamless. But above all it has empowered the retail investor like never before. With information and action at the tips of her fingers, online is a natural choice. Continue reading

Trading Rule – “Always Focus on Your Real Returns”…

Real return is a simple idea, most people fail to appreciate. Eventually, the real return you earn matters i.e. return after inflation. Nothing steals your investment value as much as inflation over a period of time. Not including inflation into your workings can give an erroneous and an extremely misleading picture of your investment health. Get a hang of real returns for that is what you really earn on your assets. It is all about getting real. Continue reading

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

%d bloggers like this: