iCharts Discussions

[buffet71]

[color=green]Hello Friends,I have few questions in my mind hope all icharts subscriber will attend my question including the moderators :- Q.1 :-Is Trading can be made a total loss proof business???? Q.2 :-Despite having sound technical knowledge many traders take trading as a secondary and their primary is their jobs or business.Isn't bcoz of that they are not confident enough with their technical knowledge??? Q.3 :-Can trading give us that return where jobs and other business stands far behind??? Q.4 :-Do you feel that trading needs a huge capital to establish you in this field??? [/color]regards, buffet71

[rk_a2003]

1.No, it can not be a total loss proof business. It can be made a net profit business over a certain period of time.

2.Irrespective of the fact whether traders are confident in their technical knowledge or not; trading is risky business (a sudden collapse/spurt in the market may happen at any point of time even with out triggering your stop loss, in that case your capital can very well be wiped out.).That could be the reason for making it as secondary keeping a primary source of income on which they can bank on for survival. It again may differ from person to person .I know few traders whose primary activity is trading.

3.This again depends on strategies adapted and the ability of the trader to apply them to the market conditions and also the capital that can be deployed.

4. Not necessarily; but substantial capital is definitely required.

[amitagg]

1. Trading can never be a loss proof business...if u see some web presentations of actual high profile global traders who have marked their trading performance over 20-30 year period, and the losing winning streak percentage one can realise that "year of losses" can arise....In the end, for me, the performance profile of succesfull trader shall be "only" ( who has the right experience and technical skill set) the act of "sitting tight in profits" and cutting losses short...
2. Because most traders do not have the right experience of "being in the market and intra day chart watching over years", and / or the personal traits of a trader (have not yet developed), they have to take trading as secondary source of income
3. Trading can lead substitute other income sources including primary source but in view of life cycle changes and ris k bearing abilities with time, trading becomes 'teaching trading'..
4. Substantial capital is required for trading..a word of relative significance ...protection of capital...not feeding your trading capital with outside sources routinely...leveraging risk capital (not personal capital) on occasions (and selectively)...all needs to be done one or more occasions for a successful trader....some trading strategies have to be deployed in one go (which most traders again forget but is important for "diversification (of risk)") and hence the need for substantial capital to iron out the losses in any strategy over a period....

[pkholla]

Buffet: Please read all books of Dr Alexander Elder. Many of your doubts will be cleared. Even when his trading income became good enough to be stand-alone he continued to practice psychology because psychology helps him to trade successfully.
Many of the best traders are doctors esp psychologists because share trading is 90% a mind game where our doubts, fears, greed etc may overcome logic and common sense!
Read books like trading strategies of highly successful traders because they help you identify what separates them from the rest and point out your path ahead!
I had many losing trades in end 2010, early 2011, because of listening too much to losers who also came to the brokerage where I traded. One trade was done (selling puts at peak to see what will happen!) while I slept at the back around 230PM, the market bombed 500 pts from there. YOU LEARN TO KEEP TRACK OF TRADES, AVOID LISTENING BLINDLY AND DO TRADE MGT INCL BEING ALERT TO INVASION OF YOUR ACCOUNT BY OTHERS INCL CROOKED TRADING STAFF

Prakash Holla

[amitagg]

[systrader]

Q.1 :-Is Trading can be made a total loss proof business????
Ans : NO
Q.2 :-Despite having sound technical knowledge many traders take trading as a secondary and their primary is their jobs or business.Isn't bcoz of that they are not confident enough with their technical knowledge???
Ans: At there early stage they prefer but as the time passes they become enough confident and prefer to switch Trading as PRIMARY.
Q.3 :-Can trading give us that return where jobs and other business stands far behind???
Ans: Sir ji suppose you got average of 5000/day/Lot in early days with limited capital and knowledge so 5000*15 trading days=60000/= (if supposed you got bad trade for five days) and as knowledge and capital increases so the monthly income too.
Q.4 :- Do you feel that trading needs a huge capital to establish you in this field?
Ans: No. Start Small, increase capital, Increase Experience, Increase Lot Size, interms Increase Profit too.

[amitagg]

Hi disagree with Q4 response..while the response if "theoretical"..don't think trader (except the famous ones) make profits from year 1 (I mention year not day)...so when a trader actually becomes a "professional trader"...by that time years elapse and do does his income (trading or other sources) and hence greater capital can be "profitably deployed" in trading....when the transition to a more loss limiting trader has been completed...

So "greater capital" actually helps to "trade your plan" as they say...it is utmost needed practically (I don't believe practically people deploying less capital are currently successful traders..they are actually learning the tricks...and fresh in business as do anyone of us has been in beginning)

[systrader]

[amitagg]

Agreed that capital cannot be "greater" initially...but if the question begets "capital needed for successful trading"...its "greater capital"..after one has burned and learnt the trade...as a saying goes "money follows money"...in trading it is true "provided" one has learnt the tricks...otherwise the burning process shall continue
Regards.

[amitagg]

So that my comments are not misunderstood let me add that it is a matter of personal trading style and perference...and there are no hard and fast rules..and also that "famous traders" can make a 10000 dollar account to 1 million consistently in a given period and recurrently...so capital deployment become practically unimportant for such traders...but I was only talking of "average professional traders"...

[Rebel]

1.No, it can not be a total loss proof business. It can be a good income generator and can boost networth till you stay in business...your networth is 20x times roughly ,your capital.

2.sometimes unexpetctedly within few seconds your capital can be wiped out.so,make second source income so when such situation occurs you can still enter with other source income,by this way you can be always in the trading career.FYI im also a full time trader with a secondary income backup.

3.there are plus and minus in every area,for job u need to answer ur manager/boss,leave policies travel etc,for other business need licence,premise,goods,staff etc,here there are no such barriers.

4. Not necessarily; but substantial capital is required,i love trade a sizeable volume so that when u earn for the day/week big it make u feel great.so make sure one thing first try to take all ur capital as profit within few months without withdrawing the profits so that ur money is back,then u can trade with earned profits.FYI im also a fulltime trader,just a 24 year old trader.i have seen a person who had lost almost more than a crore rupee trading commodity gold/silver he belongs to jain community,but still he is trading.if it doesnt suit surely we need to bid goodbye to markets after a specific time...just a a personal view.


thank you...

[shekharinvest]

[amitagg]

[ProTrader]

[svkum]

Buffet- As any human being cant be healthy and sickness proof , he needs medical attention whenever he falls sick ,
similarly in TRADING losses are required to keep trading career healthy and robust. learning while trading is like vaccination , so that trader make himself loss resistant, (though cant be avoided)

so losses are good , dont shy away , face boldly .

only retired ppl can opt for full time trading , with small capital .