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I got an interesting comment in my article “As Predicted Nifty Hits 8000 in 14 Days” and thought that the question and my reply is both worth sharing with you and post it in a new article. The reason is my website visitors usually do not read the comments in the post. Please note that to hide the real person’s name I changed it to just his initials.
Here is the interesting comment:
Dear Mr Shaw,
I must accept that your writings are very true and many who read can relate themselves to the facts mentioned in your writings, like lose too much money too fast, and I am one of them, may be its greed or desperate attempts to recover the lost money, which is never recovered and losses mount till one throws the towel in with nothing left to trade.
All said and done, I wish you could advise investors when and where to invest and when to book profits than giving them courses to learn to trade, frankly no one has the time to learn and grasp the ever changing funds of market, you can have your conservative charges for buy and sell calls, I think that will generate more confidence in you than your courses. After all everyone is not Dilip Shaw to predict market moves like a true fortune teller.
Never the less love reading your write ups.
Keep It Up.
This was an interesting question and my reply become too long so I did not post the reply there instead its here as a new post which I want you to read:
My reply to the above question:
Thank You KPS for the encouraging and nice words. The idea of writing in this blog is to share the knowledge of trading and options I have with my readers. And remember its free for all who want to read, no one is forcing them to pay me before taking knowledge away from this site. It is sad that only 10% who visit my site subscribe to get my free 5 day course, option beginners free course and newsletters full of trading knowledge for free. I think 90% do not register because they think – “Oh again some hard work I do not want to work and study”. 🙂
Note that I share true trading and life knowledge not fake ones like many blogs share. I do not believe that depending on someone can make money ever in any business. To make money in any business you will have to learn the trade and for that hard work is required. Stock trading is also a business.
Why do people do MBA or Engineering then? Why not take a Job and take help of tip providers and complete the job and keep getting promotions? Because God has made sure that short cut to success does not exist in this world else everyone would take the short cut to success route. In that world no schools or colleges will exist at all, because no one will go there to study. Because tip providers are there, why study and work hard? Do you think that world can ever exist?
In that kind of world then who would seek knowledge when short cut to success already exists? In fact within years you will not find any tip provider too because everyone will look for tip providers no one will take the hard route to seek knowledge and the whole world will collapse because there will not be a single person who has true knowledge. God will never allow this to happen.
Name me one person who has made it rich in any business taking help of tip providers? Not a single person exists in this whole world in any business who made millions by getting ideas to trade by tips providers.
Moreover I hate lazy people and I do not want to make money doing a SIN in the eyes of God creating lazy people. I fear God and I am sure God will punish me for that. I know that if I start giving sell and buy signals I can make a lot of money every month because people believe me and trust me – but I will feel guilty for my life for taking that money because it will be in my mind that I am doing a sin. So frankly I do not want that money. I love peace more than money.
Also I fear God and do not want to make money by making people lazy and dependent on anyone to make money. I am very happy where I am today in my life and do not want to run after money that will surely make me unhappy. I have written my goals in life and how much money is required to achieve those goals and I am going right on track – that’s more than enough. I do not want to destroy my peaceful life and make more money because I do not know what I will do with that money. If you buy something that you have never used in your life then you wasted money. In other words I do not want money that I will just keep in my bank and make the banks rich and I myself will never use it. Whats the point in earning that money?
Let me tell you a bit more about myself – I love people and want to see them prosper in life through hard work. I do not love money like most people do. They just run after money day and night and do not care about their health, family, and peace. The result? They do make some money or do not, but Gods make sure they live a pathetic life without knowing that they are living a horrible life. 24*7 they think about only one thing that is money. Their health suffers, they live a stressful life and are always unhappy in life because there is no end to zeros that can be added to their net worth. Adding zeros is unlimited which never ends so their dream never ends. They want to keep making more, and they ultimately die without enjoying the money they had made. And you know what their families also suffer when they were alive because these people never give time to their families they only give their time to a printed paper with something printed on it. God only knows what makes them fall in love with that printed paper so much so that they destroy their life.
Simply speaking people lose money in stock markets because they want to take short cuts to make money fast and do not want to get any knowledge or do any hard work. Here is some proof – less than 1% of people who visit my site enroll for my course. Which proves that 99% of them just do not want to learn and are only looking for a tip provider. You know the result – they lose money trading their tips too and on top of that they pay them to lose money.
After a few month they realize their mistake and call me to tell their story. Looks like they feel guilty after failing in the short cut way to make money. People looking for tips forget that their parents sent them to school to get education and knowledge and work hard to make money. If tip providers can make money then people can save lakhs of rupees on school fees by not sending their kids to school, but as a parent you will not do this mistake but you yourself are willing to commit that same mistake and of course end up paying a heavy price for it. Mind it this is not a small price but a heavy price – with this money you could have sent your kids to a better school making sure they get a better career and life – but they pay a price throughout their life for you trying to take short cut to success.
Due to almost 10 phone calls I get in a day, I have experienced that controlling over greed is the biggest issue with most traders even those who are trading since last 10 years and have lost heavily in markets. Most people who have taken my course are making 2-3% a month, but then some mail or call me to ask if there is any strategy which can make 5-10% a month because they are not satisfied with 3% a month return. I give them a very simple answer – when Warren Buffett the best stock trader in the history of stock investing is averaging only approximately 25% a year return since the last 20-25 years and became the richest man in the world how on Earth do you think you can beat him? Do you think you have more knowledge than him? Then they realize that they are falling for greed and keep their phone down of course after thanking me.
So if you are making even 2% a month return from trading or stock investing be very happy with the returns. Today’s inflation is around 7% and you are beating inflation by 24-7 = 17% a year. That’s huge.
Do not fall for greed because it will take away whatever you have made till date. And do not forget that compounding is the best magic in the world which most of us can try and do but do not want to take benefit of it.
See this: Rs. 1 lakh invested every year for the next 25 years (which is highly possible with most of us having a good job) at the rate of return of just 24% a year will become Rs. 133,017,562.18 (Rupees Thirteen Crore, Thirty Lakhs, Seventeen Thousand, Five Hundred and Sixty Two). How much was your investment? Only Rs. 25 Lakhs. Assuming that you are 30 years of age having a good job the above investment is very much possible. Now by the time you become 30+25 = 55 years of age you are richer than many people in the world. On top of that still 5 years are left for retirement. Do not forget even Warren Buffet took two to three decades to become the richest stock investor in the world. He did not achieved it overnight or in 2-3 years. He knew it will take some time and knowledge. He was willing to give time, and see the results are in front of all of us. Strangely we want to read about him but we do not want to follow his patience and hard work way of investing. How on Earth you will succeed in making more than him and create history?
You said that no one has the time to grasp the fundas (fundamentals) of markets. Oh really? You have all the time in the world to watch movies, have fun on weekends, go on long holiday trips, watch 5 days cricket match, other sports and serials on TV but when it comes to reading news on markets you say you do not have time? That’s an excuse. Say that you do not want to work hard.
As far as confidence in me is concerned I am not wring in this blog so that you have confidence in me, I just want you to read and get some knowledge. If you get it its fine else it’s your life over which I do not have any control so I cannot force you to learn. If you are willing to learn you benefit else it’s your life.
When I said that Nifty will hit 8000 in some time, I was NOT trying to show off that look I am a fortune teller. The idea was to tell investors to trade it in the correct way to make some money which was also written in the post. In fact we all knew that Nifty may reverse any time because stocks were looking very attractive and DIIs and FIIs will definitely start buying them. It is a different story that my prediction came true in 14 days. I agree that it could have taken more time but 8000 was on the cards and how I plan to make money from these medium term predictions was shared in that blog post to help people get a free idea to make money – that is it – not to prove that I am a fortune teller. Some people did say in comments that it is not a big deal and I accept that it was not, but I made money out of that prediction, how many of others make? I just wanted to share that idea with my readers and help them make money. I do not know if anyone followed the idea and I never forced anyone to read this idea but still some people had issues. Somebody is working hard to help investors for free and you have issues – isn’t it strange? Actually it’s not because I have experienced this many times that giving free tips is not at all valued by people.
Therefore these kind of ideas will now reduce significantly because a lot of people hate free advice even from experts in stock markets. I got too many people unsubscribing from my newsletters on that free trade idea article. So I have decided to reduce the free ideas in my blog especially prediction of markets. This was an exception because I cannot control myself when it comes to helping my blog readers.
It is strange that you have lost too much money to greed but still are not willing to work hard and learn and want to take tips. Let me tell you that if you do not have time to invest in knowledge then you can never make money in stock markets because people who have invested in knowledge will take your money away and they deserve it and its justified too. Why do you think only 5% of traders make money? Because these people invested first in knowledge then in markets. Those who took short cuts and invested in markets out of greed without any knowledge keep losing time and money for years.
Hope this article helps you to understand that knowledge, hard work, risk management and patience is the key to success in any business and stock trading is also a business. If you are not willing to listen to me it’s up to you, no one can force you to learn. But let me tell you that time will force you to learn or you will lose money and regret and stop trading. I just hope you listen to my advice and do not let that time come in your life.
Thanks for reading. Do you agree that knowledge helps in trading? If yes or no please write in the comments section.
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Good article. Retail investors who want to make money in stock market must educate themselves.
Yes Kirit very true but most do not believe it until they lose lakhs. I am also an example.
I totally agree, without knowledge there is nothing in life. I have subscribe in your web site around month back and read most of your articles. You have written real truth. I am really impressed with the way you’re thinking and writing. It shows you’re honesty in sharing the knowledge not only in nifty option trading but also about real life.
Thanks Srinivas. Yes in other fields people think knowledge is important to achieve success, but strangely when it comes to investing everyone thinks they are smart and know everything as if 2+2 = 4 is enough knowledge to invest. Its far from the truth. Investing in stocks for a long term may not be a business, but trading is and to succeed in trading you need knowledge and patience.
Excellent article. Many people think trading is easy just two things buy and sell, you do the desired and get huge profits. general mindset of people is stock market traders makes lots of money in quick time. I fail to understand how this notion got developed that too on large scale. Trading is just like any other business. apart from entry in trade stoploss, trade management and money management is very important part of trading. trading style differs from person to person so what is suitable for one person may not be liked by others. This is also one of reason why tips do not work.
True Kaisar. I think “making money is easy in stock markets false notion” is there with almost everyone because a lot of people keep telling them false things. Like if you call your broker and ask I want to invest in *** stock will it go up – they will say absolutely yes within months you will make 20%. And the investor gets duped by a false acclaim because they think brokers know a lot about stock markets forgetting that brokers make money if they trade else they do not. So why they will say no? Then of course we keep getting SMS like make 16 lakhs from 2 lakhs in one trade. People think it must be easy to make money in stock markets so why work hard. And then they start taking tips. Both the above routes leads to losses then they realize their mistake. But by that time lakhs have already been lost. Unfortunately this story is same with almost every stock trader.
Thanks for the comment.
You hit the nail on the head, bang on target. It’s the greed to get too much too soon takes out even the last penny from traders account. With get rich soon attitude the new traders leap into market with all the money they have just to be thrown out of it pennyless.
They learn the lesson the hard way. So in short hard work is important, very important in Stock market. You need to read all the time, grasp the knowledge and enhance the same on regular basis. I specifically want to thank you for helping me out with ur course as well as blogs. I have read all ur articles more than once and still reads them just to enhance my knowledge. Keep the good work going, we are with you…
Vinod Kumar Prasad
Thank You Vinod Kumar Prasad 🙂
Dear Dilip, very good article, no shortcut for success , only hard work is perfect way , even for stock market reading and analysis of daily financial news is very important to take decision on stock selection , thanks for below article
Thanks and Regards,
Hats off Dilip shaw for such a great article .every word you said is 100% truth .
MOST IMPORTANT ONE –
” short cut to success does not exist in this world, else everyone would take the short cut to success route”
Exactly but how many people believe that? It has been proven years after years that the only route to success is hard work and time, but when it comes to stock markets trading people forget that simple rule to success and of course pay a heavy price for that.
Your reply was too good to be ignored. I wish you added that you too made losses even with all the conservative techniques you taught because loss is part of the game. Another perspective is that people should be expecting something like 10-15 pm as additional income. So it will require a 5-7.5 lakh investment. I am unsure but people will be thinking that investing something 50k or 1 lakh should fetch them this return possibly because they can afford to lose that money. So most of us ended up in losses. I have also started making money since the last two months after several years but not in line with the course that I learned from you. In effect, markets are quite similar to gambling though technique plays a good role in addition to lady luck’s favor. But your articles and analogies help me in keeping control on clicking the buy or sell button. That was the biggest mistake perhaps that I made for several years. Thank you.
Welcome and nice to know you have learned something from the course. I never tell a lie. Even in my course details page and when people call me I do say that it succeeds 80% of the times since we are trading and sometimes losses may happen even if they are the best strategies to trade. The losses are very limited since all my trades are properly hedged. So there is no fear and stress of trading. But at least over a period of time it makes money which is more important than losing money. Like you were losing since last 2 years but after the course you started making money without stress and you should be happy with that even if its slightly less than 3% a month. Let me tell you some months can be more than 3% when VIX is at the higher end. Also if you remove brokerage costs you will see that returns were more. If you need 10000-15000 as additional income then yes its a business so you will have to invest more, that’s the rule of a business I cannot change that rule. Exactly the goal of my course is to make sure people learn to keep control on clicking the buy or sell button and of course also on greed which is the biggest destroyer of wealth in any business.
hi sir in my point of view greedy people don’t deserve your article but for me your each and every article is like a immunity to my mind now i don’t mind if i don’t make money also i feel knowledge and hard work is very important in life and god also will punish us for short cuts and sir 2-3% is more than enough so as i am 20 ! 20+25=45 i will enjoy my success 10 years before 🙂 please sir please don’t think to reduce your ideas because your my inspiration i respect you and your precious articles its very hard to find a person like you who could even tell the values of life
Thanks Priyanka for kind words. Only problems with giving free ideas is that when it works 10 people say thanks, when it does not 100 come and start abusing. And I feel its not good to post here where the market is heading because I am sure greedy traders will read and buy/sell Futures. That’s exactly I do not want. I predict medium term not short term which is the most important for Future traders but they do not understand and let their greed for money take over. So predictions will almost stop.
Learning points from this post :
Depending on someone can’t make money ever in any business. To make money in any business you will have to learn the trade and for that hard work is required.
Knowledge, hard work, risk management and patience is the key to success in any business and stock trading is also a business.
Plz correct the following lines :
In paras under sub title ‘ My reply to the above question : ‘
In 5th para :
‘ Name me one person who has made it rich in any business talking help of tip providers? ‘
‘ Name me one person who has made it rich in any business taking help of tip providers? ‘
In 7th para :
‘ I am very happy where I am today in my life and do not want to run after money that will surly make me unhappy ‘.
‘ I am very happy where I am today in my life and do not want to run after money that will surely make me unhappy ‘.
In 9th para :
‘ Here is some proof – less that 1% of people who visit my site enroll for my course ‘.
‘ Here is some proof – less than 1% of people who visit my site enroll for my course ‘.
In 15th para :
‘ You said that no one has the time to grasp the funds of markets ‘.
‘ You said that no one has the time to grasp the fundas (fundamentals) of markets ‘.
M S Rao
Sir done. Thanks from my heart.