There are somethings which i have learnt in my small experience from people i have learnt from and read about of ....Prevention is better then cure ...Better to have small holes in the pocket then big holes in ur portfolio ...
Below i have quoted some of the lines on trading and speculation written in the book of William D Gann, the only analyst and trader who was the tracked by New York times and had greatest returns ever...Gann Analysis being the most difficult analysis to understand ...
You must always put a stoploss to preserve capital
A small loss or several small losses can easily be made back with one large profit but when you let large losses run against you it is hard to get them back.
Remember when you are out of the market the only thing you can lose or miss is an opportunity.
The fear of the market is the beginning of wisom.
Never average a loss rather buy on the way towards profits.
The most important of all ( HUGE FNO traders and Margin traders. )
When you make a trade you should never risk more then 10% of your capital and if u have a few losses reduce your units of trade.
Some of My views :
1) FNO trading and margin trading .
How many of u guys would buy your food or clothes on margins none isnt it. Gann the best analyst says risk 10% of capital. In FNO trading in major stocks u put in 20-30% as margin. So you know ow much you are risking. actually at times people the accumulated mark to market margin additions become more then the margin needed to trade.FNO was meant for hedging and not for speculating and if you are speculatinng have a stoploss. In Bucket shops an old term a one or two point margin was played on like u buy at 100 stoploss is at 98 bcoz it was only about profit or loss u pay and not any margin so u buy say 10000 shares u give him 20k . I would rather like that at least u know what u r risking. And thats why i have never insisted on FNO trading for all its only who can afford that risk taking.
Now you will say stoploss hit hota hai aur fir bhagta hai...So i keep no stoplosses.All the suckers put in sell orders after the buy. like a guy buys a stock at 100 in FNO keepa sell at 103. When the brokers call him at 96 sir margin he replies cheque will be sent cool sucker na want a rupee give a 5 ....,
The winners put in a stoploss after they buy and keep trailing the stoploss more then keep selling orders....Find what u want to be the sucker who talks only about his good trades.
To end with : If you have lost money doesnot mean you are incapable of making money but educates you to make bigger and easier money.
I ll end of with a few lines in the final notes of the book....
"If i can throw a single ray of light,
Across the darkened pathway of another;
if i can aid some soul to clearer sight ,
of life and duty , and thus bless my brother;
If i can wipe from any human cheek a tear ,
I shall not then have lived in vain while here.
"IF U LIKE THIS STUFF PASS IT AROUND
i feel it will help others too ...