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A lot of people are now moving towards what traders are trying to do in US, UK and other developed nation – Algorithmic and Quantitative Trading.

So I thought let me write a quick post and tell you what it is.

Algorithmic trading is basically done by machines. You must be thinking – wow machines who do not have any emotions of greed and fear – wow they will make a lot of money trading on formulas.

I have made formulas in bold. WHY? Because this is the most important part of Algorithmic Trading. read more

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Date: Wed, Jul 18, 2018

Nifty saw a resistance at 11000. Resistance at 11,000 is a Huge Psychological Resistance At Play in Nifty.

I hope you know that Nifty does not move depending on the derivatives markets – it is totally depended on the Nifty 50 stocks:
https://www.moneycontrol.com/markets/indian-indices/?ind_id=9
https://economictimes.indiatimes.com/indices/nifty_50_companies

On top of that not all stocks have the same weightage on Nifty. Some have more some less.

I am sure you may be surprised that currently some stocks are below their level when Nifty was at 10,500 a few days back. Today its at 11,000 still many Nifty 50 stocks and others too are below what they were when Nifty was at 10500. read more

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Losing money in stock market trading is common but when I come across heavy losers, I write in my blog.

Some examples are 3 crore loss, 2 crore loss, 40 lakh loss (must read) and now this 60 lakh loss. Total loss of these four traders equals 6 CRORE.

Read this whatsapp chat:

Yes I feel bad when someone says he/she lost money trading the stock markets. Well if you start a business without knowing the ins and outs of the business you are sure to lose money. But thne somewhere sense should prevail. You must stop trading and start researching. read more

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In the year 2007 a few people from a local stock brokering firm came to my house to explain about stock markets and I was done. I opened a demat account the next day with a lot of dreams. What happened after that you can read here. Now in 2018 the story has changed but it was after a lot of struggle.

In short I started with stock investing – failed, then intraday trading – failed, then moved to derivative trading – failed there too – lost 7 lakhs and stopped trading to learn trading. Its 2018 now I am totally deepened on trading and investing profits. I left my job in the year 2016 and pretty happy about it. I am also happy that my conservative option course is helping a lot of traders since 2015. Testimonials. read more

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First what is physical delivery of stocks in options & futures (derivative) trading?

All over the world, on the expiry day derivatives are either settled by cash or stocks. Until June 2018 in India all derivatives – options and futures were cash settled. Well no more – Securities and Exchange Board of India has introduced long awaited physical settlements of stocks from July 2018 in 46 stocks only (list below), but soon I assume all the 170+ stock F&O contracts will be physically settled. From July 2018, there will be physical settlement in equity derivatives (options and futures both). read more

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You need to know more than Delta, Gamma, Theta to be a good option trader. To be honest Delta, Gamma, Theta are just the theory on how options are made – they do not give direction of options. You can download a file here where I have explained in details about Delta, Gamma, Theta of options. But this is theory after this you need to learn strategies to make monthly income.

See this chat where this person is failing to make profits even after knowing about Delta, Gamma, Theta:

I keep getting calls from some option traders like Sir I am shorting an option with Delta 0.4 – will this make profits for me. read more

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What Is Hedging?

Hedging is an insurance of a trade which comes into action when the original trade starts losing money. Hedging is a great way to protect your capital when trading or your portfolio as a whole.

Do you know that HIIs (High-Net-Worth Individuals) and DIIs (Domestic Institutional Investors) & FIIs (Foreign Institutional Investors) always hedge their portfolio against any odds. It does not matter they pay a price for hedging but they know very well the importance and necessity of hedging. They have crores at stake they are not fools to trade derivative naked (without hedge). read more

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How To Become A Full Time Stock Trader

A lot of traders who call me to inquire about my course ask me this question after I tell them about the course – “I want to become a full time trader, I want to make trading my profession – is it possible?”.

Well the answer is yes, but there are certain criteria.

1. What experience you have in trading? 5 years or more is good.

2. Are you trading on tips or advisory service? If the answer is yes you will never become a full time trader. Tips/advisory service do not work and will never work in stock markets. read more

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Margin Short Penalty Explained July 2018

Note: From 2nd July 2018 onwards, SEBI has made it mandatory for both SPAN and exposure margin to be blocked in order to take and carry forward an overnight position. If it isn’t, margin penalty will be applicable. Click here for the circular from NSE.

Your broker will now block both Span & Exposure margin. In some parts of India some brokers used to block only Span margin, so this rule was made. Now every derivative trader is on the same platform – earlier some traders had an advantage of paying less and making more but losing the same. Now they will also have to pay the same money (margin block) to trade futures and sell options. read more

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When Nifty Does Not Move Its Hard To Trade

When there is no movement in Nifty it becomes very difficult for option traders to decide what direction to trade – in fact same for future traders. See this:

Nifty 25-06-18

Its like a small mountain – down, then up, then down, then up, but over all its just 26 points move – so which direction to trade?

This is confusing for traders.

This is the reason trading volume in derivatives drop when there is little movement in Nifty. By looking at the intraday chart most traders will buy puts only to see Nifty rising to hit stop loss and then fall. read more

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