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Lesson Posted on 13/03/2017 Intraday Trading (Stock Markets) classes Technical Analysis (Stock Markets)

Stock Market Trading tips - 2

Hanamant Kullur

I am a Professional Trader, Trainer and Technical Analyst with more than 4+ years experience. I do Teach...

Ed Seykota Ed Seykota’s Trading Style My style is basically trend following, with some special pattern recognition and money management algorithms.In order of importance to me are: (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell. Those are the... read more

Ed Seykota

Ed Seykota’s Trading Style

My style is basically trend following, with some special pattern recognition and money management algorithms.
In order of importance to me are: (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell. Those are the three primary components of my trading. Way down in very distant fourth place are my fundamental ideas and, quite likely, on balance, they have cost me money.
I consider trend following to be a subset of charting. Charting is a little like surfing. You don’t have to know a
lot about the physics of tides, resonance, and fluid dynamics in order to catch a good wave. You just have to be able to sense when it’s happening and then have the drive to act at the right time.
Common patterns transcend individual market behavior (my note: i.e. price patterns are similar across different markets).
Overall Rules

Trade with the long-term trend.
Cut your losses.
Let your profits ride.
Bet as much as you can handle and no more.
Buying on Breakouts

If I were buying, my point would be above the market. I try to identify a point at which I expect the market momentum to be strong in the direction of the trade, so as to reduce my probable risk. I don’t try to pick a bottom or top. If I am bullish, I neither buy on a reaction, nor wait for strength; I am already in. I turn bullish at the instant my buy stop is hit, and stay bullish until my sell stop is hit. Being bullish and not being long is illogical. Only Exit When Stops are Hit and Set Stops Immediately.

I set protective stops at the same time I enter a trade. I normally move these stops in to lock in a profit as the trend continues. Sometimes, I take profits when a market gets wild. This usually doesn’t get me out any better than waiting for my stops to close in, but it does cut down on the volatility of the portfolio, which helps calm my nerves. Losing a position is aggravating, whereas losing your nerve is devastating. Before I enter a trade, I set stops at a point at which the chart sours.
Learn to Get Back In Getting back in is an essential part of trend following.
Hold Your Position Until the Trend is Invalidated, Do Not Let Go of Your Position. Be Willing to Experience Your Anxieties.

Maintaining a commitment is particularly important when it comes up for a test. Somewhere along the line of keeping your commitment you may get a feeling that you don’t like. If you are willing to experience the feeling, it can transform into an AHA that supports your commitment. If you are unwilling to experience the feeling, you might abandon your commitment to try to make the feeling go away. That only results in having to feel the feeling after all. The more you are willing to experience the feeling of bumping into walls, the less you have to bump into walls. Trading requires skill at reading the markets and at managing your own anxieties. People have a Conscious Mind and Fred. Fred wants to communicate feelings to CM so CM can experience them and gain experience and share it with Fred so Fred can learn how to react. This is how we manufacture wisdom. When we don’t like our feelings we tie them in k-nots and do not experience them. This interrupts the wisdom manufacture process, and draws drama into our lives. K-nots, protect us from truth and keep our lives in drama. To untie k-nots, fully experience whatever appears in the moment. When you keep your eye on the prize and are willing to experience all the feelings that arise, the prize soon becomes yours. Do Not Shut Out or Ignore Your Fear.

The positive intention of fear is risk control. People who are unwilling to experience fear tend to take big risks and wind up in big drama in which the risk materializes. People with poor risk control tend to bet heavy. So they tend to outperform others in good markets, and under-perform them in poor ones. Risk is the uncertain possibility of loss. If you could quantify risk exactly, it would no longer be risk. Risk control has to do with your willingness to allow your stop to do its job.
Risk Below 5% of Equity Per Trade.

I intend to risk below 5% on a trade, allowing for poor executions. Occasionally I have taken losses above that amount when major news caused a thin market to jump through my stops. Risk no more than you can afford to lose, and also risk enough so that a win is meaningful. If there is no such amount, don’t play. Speculate with less than 10% of your liquid net worth. Risk less than 1% of your speculative account on a trade. This tends to keep the fluctuations in the trading account small, relative to net worth. This is essential as large fluctuations can engage Fred and lead to feeling-justifying drama. Betting more boldly produces more volatility. Good traders are familiar with both and keep their trading well within their tolerances.
I use a rule of thumb that you place less than 10% of your liquid net worth at risk and that you stop your losses at 50% of that – so you have net exposure of 5% of your liquid net worth. If you have a net worth of 1.5 million, you might have liquid net worth (cash, stocks, bonds, etc) of, say, about 500,000 (a wild guess). Then you might place $50,000 of that at risk and cut your loss if you lose $25,000. The idea is to keep the venture below your threshold of financial importance, so nominal ups and downs do not trigger your emotional uncle point and motivate you to abandon the venture during drawdowns.
What Trend Trading Is (Ignore Fundamentals).

Reliance on Fundamentals indicates lack of faith in trend following. For Trend Traders, understanding the markets is typically optional, often counter-productive. When an up-trend happens, the price is moving up. Trend Traders get a signal and pull the trigger without regard to the result of any individual trade. Playing for comfort and searching for meanings are both counterproductive to Trend Following. Trend Following systems do not speak about entry and exit prices.
Trend systems do not intend to pick tops or bottoms. They ride sides. I don’t implement momentum; I notice it and align my trading with it. There is no such thing as THE trend. Some of the shorter indicators are down while some of the longer ones are still up.  You Don’t Need to Get Caught Up in Intraday Market Movements / Do Not Day Trade

Having a quote machine is like having a slot machine on your desk— you end up feeding it all day long. I get my price data after the close each day. Day Trading is an exercise in limiting profits while continuing to pay normal transaction costs. Day trading may provide a way to cover up deep feelings that the trader does not wish to face. Short Term Trading is one good way to realize your intention of reducing account equity. Intraday trading is tough since the moves are not as big as for long-term trading and there is no comparable reduction in transaction cost. In general, short-term trading systems succumb to transaction costs and execution friction. You might simulate your system over historical data and notice how sensitive it is to assumptions about where you get your fills. The shorter the term, the smaller the move. So profit potential decreases with trading frequency. Meanwhile, transaction costs stay the same. To compensate for profit roll-off, short-term traders have to be very good guessers. To improve guessing skills, you can practice dealing cards from a standard deck, one at a time. When you become very good at it you might be able to make money with short term trading. Prudent Money Management is the Key to Longevity.

The key to long-term survival and prosperity has a lot to do with the money management techniques incorporated into the technical system. There are old traders and there are bold traders, but there are very few old, bold traders.
The manager has to decide how much risk to accept, which markets to play, and how aggressively to increase and decrease the trading base as a function of equity change. These decisions are quite important—often more important than trade timing.
I have incorporated some logic into my computer programs, such as modulating the trading activity depending on market behavior. Still, important decisions need to be made outside the mechanical system boundaries, such as how to maintain diversification for a growing account when some positions are at position limit or when markets are too thin.
I tend to alter my activity depending on performance. I tend to be more aggressive after I have been winning, and less so after losses. Longevity is the Key to Success.

The profitability of trading systems seems to move in cycles. Periods during which trend-following systems are highly successful will lead to their increased popularity. As the number of system users increases, and the markets shift from trending to directionless price action, these systems become unprofitable, and undercapitalized and inexperienced traders will get shaken out. Longevity is the key to success. Do Not Pyramid Aggressively.

Aggressive pyramiding, and other forms of accumulating monster positions are good ways to lose big money, even in a bull market. The Trader and the Trading System Must Meet.

Systems don’t need to be changed. The trick is for a trader to develop a system with which he is compatible.
My original system was very simple with hard-and-fast rules that didn’t allow for any deviations. I found it difficult to stay with the system while disregarding my own feelings. I kept jumping on and off—often at just the wrong time. I thought I knew better than the system.
Also, it seemed a waste of my intellect and MIT education to just sit there and not try to figure out the markets.
Eventually, as I became more confident of trading with the trend, and more able to ignore the news, I became more comfortable with the approach. Also, as I continued to incorporate more “expert trader rules,” my system became more compatible with my trading style.
As I keep trading and learning, my system (that is the mechanical computer version of what I do) keeps evolving.
Over time, I have become more mechanical, since (1) I have become more trusting of trend trading, and (2)
my mechanical programs have factored in more and more “tricks of the trade.” I still go through periods of thinking I can outperform my own system, but such excursions are often self-correcting through the process of losing money.
I don’t think traders can follow rules for very long unless they reflect their own trading style. Eventually, a breaking point is reached and the trader has to quit or change, or find a new set of rules he can follow. This seems to be part of the process of evolution and growth of a trader.
A trading system is an agreement you make between yourself and the markets. Embrace Whipsaws.

Trading Systems don’t eliminate whipsaws. They just include them as part of the process. Do Not Predict Or Anticipate.

A computer can follow a system and place orders without making predictions or feeling anticipation. Predictions and anticipations are objects you create. These objects may interfere with sticking to your system.
Take Care of Your Emotions.

Sometimes I trade entirely off the mechanical part, sometimes I override the signals based on strong feelings, and sometimes I just quit altogether. The immediate trading result of this jumping around is probably breakeven to somewhat negative.
However, if I didn’t allow myself the freedom to discharge my creative side, it might build up to some kind of blowout. Striking a workable ecology seems to promote trading longevity, which is one key to success.
Gut feel is important. If ignored, it may come out in subtle ways by coloring your logic. It can be dealt with through meditation and reflection to determine what’s behind it.
One of the best ways to increase profits is to do goal setting and visualizations in order to align the conscious and unconscious with making profits. I have worked with a number of traders in order to examine their priorities and align their goals. I use a combination of hypnosis, breathing, pacing, visualization, gestalt, massage, and so forth. The traders usually either (1) get much more successful, or (2) realize they didn’t really want to be traders in the first place.
A fish at one with the water sees nothing between himself and his prey. A trader at one with his feelings feels nothing between himself and executing his method.
Cut Your Losses.

The elements of good trading are: (1) cutting losses, (2) cutting losses, and (3) cutting losses. If you can follow these three rules, you may have a chance. Don’t Play “Catch Up” After a Losing Streak.

I handle losing streaks by trimming down my activity. I just wait it out. Trying to trade during a losing streak
is emotionally devastating. Trying to play “catch up” is lethal. Take a Break If Necessary.

Sometimes I get to a personal breakpoint. When that happens, I just get out of the markets altogether and take a vacation until I feel that I am ready to follow the rules again. A Winning Mindset is Required To Succeed.

A losing trader can do little to transform himself into a winning trader. A losing trader is not going to want to
transform himself. That’s the kind of thing winning traders do. The winning traders have usually been winning at whatever field they are in for years. It is a happy circumstance that when nature gives us true burning desires, she also gives us the means to satisfy them. Those who want to win and lack skill can get someone with skill to help them. The “doing” part of trading is simple. You just pick up the phone and place orders. The “being” part is a bit more subtle. It’s like being an athlete. It’s commitment arid mission. To the committed, a world of support appears. All manner of unforeseen assistance materializes to support and propel the committed to meet grand destiny. In your recipe for success, don’t forget commitment – and a deep belief in the inevitability of your success.

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Lesson Posted on 13/03/2017 Financial Planning/Stock Market Trading Intraday Trading (Stock Markets) classes Financial Planning/Stock Market Investment +1 Financial Planning/Stock Market Investment/Technical Analysis less

Trading Jesse Trading Style

Hanamant Kullur

I am a Professional Trader, Trainer and Technical Analyst with more than 4+ years experience. I do Teach...

In 1929 Jesse Livermore’s fortunes were at their zenith. He had made a profit of $100 million dollars shorting the markets during the great crash. Yet, by 1934, he was bankrupt. In just five short years one of the greatest stock-traders the world has known lost his entire $100 million fortune.... read more

In 1929 Jesse Livermore’s fortunes were at their zenith. He had made a profit of $100 million dollars shorting the markets during the great crash. Yet, by 1934, he was bankrupt.

In just five short years one of the greatest stock-traders the world has known lost his entire $100 million fortune. We cannot blame this on the inadequacy of his trading rules – they were fully formulated by then. We must conclude that he ignored at least one of his sacrosanct rules – never to hold on to a losing position.

If Livermore did hold losing positions until his $100 million fortune was wiped out – in spite of the lessons of 41 years of trading – we must presume his mental processes had malfunctioned, due either to stress, depression, or a combination of the two.

Twelve years earlier, Livermore had told Lefèvre how he had put money in trust for his family. Lefèvre had asked if this was because Livermore feared that the stock market might take his money away from him.

Livermore replied prophetically:

“I know this – that a man will spend anything he can lay his hands on; and that he can lose every cent.”

Livermore himself had noted that what ultimately defeated most traders was their inability to stick to their own proven trading rules. Usually hope or fear brought them down. Hope caused traders to increase their losses by holding on to losing positions for too long, hoping the trade would become profitable. Fear caused traders to decrease their profits by selling winning positions too soon, fearful the market would turn and their winning positions would turn into losers.

“I sometimes think that speculation must be an unnatural sort of business, because I find that the average speculator has arrayed against him his own nature. The weaknesses that all men are prone to are fatal to success in speculation.”

“The speculator’s chief enemies are always boring from within. It is inseparable from human nature to hope and to fear. In speculation when the market goes against you, you hope that every day will be the last day – and you lose more than you should had you not listened to hope – to the same ally that is so potent a success-bringer to empire builders and pioneers, big and little.”

“And when the market goes your way you become fearful that the next day will take away your profit, and you get out-too soon.”

“Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep-seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping he must fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit. It is absolutely wrong to gamble in stocks the way the average man does.”

Jesse Livermore concluded that no trader could trade the market constantly and beat it. Everyone who played the market daily would eventually lose. Winning was only possible by trading at times when the market allowed one to win – during clear bull and bear markets when most stocks were moving in a single direction.

“I have been in the speculative game ever since I was fourteen. It is all I have ever done. I think I know what I am talking about. And the conclusion that I have reached after nearly thirty years of constant trading, both on a shoestring and with millions of dollars back of me, is this: A man may beat a stock or a group at a certain time, but no man living can beat the stock market”.

“A man may make money out of individual deals in cotton or grain, but no man can beat the cotton market or the grain market.”

“If I knew how to make these statements stronger or more emphatic I certainly would. It does not make any difference what anybody says to the contrary. I know I am right in saying these are incontrovertible statements.”

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Lesson Posted on 12/03/2017 Financial Planning/Stock Market Trading Intraday Trading (Stock Markets) classes

Stock Market Trading System !!

Hanamant Kullur

I am a Professional Trader, Trainer and Technical Analyst with more than 4+ years experience. I do Teach...

What Is a Trading System? Traders are constantly asking us “What exactly is a system?” The purpose of this article will be to give you that information as clearly as possible. First, we’ll go through some background information to help you understand what a system is outside of the... read more

What Is a Trading System?

Traders are constantly asking us “What exactly is a system?” The purpose of this article will be to give you that information as clearly as possible. First, we’ll go through some background information to help you understand what a system is outside of the context of trading. You’ll learn how different people relate to systems according to how they relate to money. The second part of this article will focus on clearly defining what a trading system is. The third part of this article will focus on the broader picture of your system—your trading plan. Finally, we’ll focus on some key elements in system development.

Business Systems
In Robert Kiyosaki’s book, Cash-Flow Quadrant, he distinguishes two types of people who work for money and two types of people who have money working for them. In each case, one of the major distinguishing characteristics is how they deal with systems.

First, let’s look at the idea of business systems. McDonald’s, as a major franchise, is basically a large set of systems that one buys. In fact, a person who buys a McDonald’s franchise must go to Hamburger University for about six months (I believe that’s the length of it) to learn the systems for operating the franchise. There are systems for food delivery, preparing food, greeting customers, serving them within a minute, cleanup, etc. And all of these systems can easily be carried out by a manager who has a college degree and employees who might even be high school dropouts. In other words, a system is something that is repeatable, simple enough to be run by a 16 year old who might not be that bright, and works well enough to keep many people returning as customers.

Now, knowing that definition of a system, let’s look at how people in the four cash flow quadrants relate to systems.

The Employee: Employees are basically motivated by security. They have a job and they do their work to get money. Employees basically run the systems. They don’t necessarily know that they are running a system, but that is their function. For example, one employee at McDonald’s will greet customers and take their order. This employee is basically running the “customer-greeting” system.

Most employees do not understand systems. Instead, they just know what their job is. And this is typical of employees who become traders or employees who work as traders. They typically ask questions such as “What stocks should I buy?” “What is the market going to do?” Or “How do I go about doing this?” We see it all the time in the questions we get. For example, a gentleman just called into CNBC, as I’m writing this, and asked the guest, “What direction do you think the market may go with respect to 'the war' and how might one profit from it?” These are typically employee questions. And they amount to saying, “I don’t really understand anything, please tell me what to do!” The financial media thrives by answering the questions of the employee investor/trader.

The Self-Employed Person: The self-employed person is basically motivated by control and doing it right. Notice that I have often talked about how these motivations constitute some of the biases that most traders have—the need to be right and the need to control the markets. The self-employed person is the entire system. They are basically running on a treadmill only they don’t know it. And the more they work, the more tired they get.

Like the employee, the self-employed are working for money. However, they like it a little better, because they are in charge. They think working harder will make them more money—and to a certain extent it does. But mostly, working harder gets them tired. Nevertheless, they continue to plough forward thinking that they are the only ones who can do it right.

As I said earlier, the self-employed person basically is the system. And quite often they cannot see the system because they are so much a part of it. They are stuck in all the details. In addition, they have a strong tendency to want to “complexify” things. They are always looking for perfectionism and they believe that the perfect system must be complex. They are always asking, “What will make my system perfect?”

A lot of people come into trading from the self-employed mentality—doctors, dentists, and other professionals who had their own small business in which they were basically all of the systems in one. This is all they tend to know and they approach trading the same way. They keep adding complexity “until it works,” even though this strategy seldom works. The self-employed person would be likely to have a discretionary system that is constantly being changed.

The Business Owner: A good business owner should be able to walk away from the business for a year and come back to find it running better than before. While this is an ideal type of statement, it has some theoretical truth to it. This should occur because the job of the business owner is to design a group of systems to run the business so well that his employees can do the job by themselves (or at least with a manager in place). In other words, the business owner is someone who designs systems and these are usually simple systems.

The business owner usually does very well in the trading arena if they approach the process the same way that they’ve run a business before. And, of course, the business owner would usually hire someone to run their trading system, at a much lower wage.

When Tom Basso,1 who is interviewed in The New Market Wizards, did workshops with me, he always described himself as a businessman first and a trader second. Part of Tom’s perspective was to look for repetitive tasks that a human being in his organization has to repeat over and over again. When he found such tasks, his job was to develop a program to take that task out of human hands. Routine computer programs are great examples of simple systems.

The Investor: The last person on the quadrant is the investor. The investor is someone who invests in businesses and his/her most important criterion should be, “What is the rate of return of the business?” In other words, this person is continuing to ask, “If I put money in this investment, what kind of return will I get on it?” High return investments (e.g., high returns on equity) are typically good businesses in which to put your money.

Robert Kiyosaki describes this as the quadrant in which money is converted to wealth. Rich people, according to Kiyosaki, derive 70% of their income from investments and 30% or less of their income from wages.

Most traders are probably not investors by this definition. They buy low or sell high, trading stocks. As a result, there is something they must do to generate their money. Investors, in contrast, are people who typically look for places where they can put their money that generate rates of returns of 25% or higher without them doing anything. If you know how to get those types of returns, then you want to hold onto those investments as long as possible. Many high tech stocks were showing earnings growth rates of well over 25%, and when they did, the prices went up dramatically because this is what investors want. The problem with such investments is they are not guaranteed to continue forever. Many of you have probably discovered that in the last few years.

 

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Lesson Posted on 03/03/2017 Financial Planning/Stock Market Investment Intraday Trading (Stock Markets) classes Financial Planning/Investment Planning +2 Financial Planning/Personal Financial Planning Financial Planning/Stock Market Investment/Technical Analysis less

Why Invest in Stock Market Products

Santosh D.

I have extensive experience as a stock market investor and trader. Stock market trading and investing...

Usually investors go by the "returns" on invetsment /capital appreciation and to some extent the tax benefits. But there are more important considerations like liquidity, divisibility and ease of transactions for any investment. Learn why these parameters are importants and how the stock market investments... read more

Usually investors go by the "returns" on invetsment /capital appreciation and to some extent the tax benefits. But there are more important considerations like liquidity, divisibility and ease of transactions for any investment. Learn why these parameters are importants and how the stock market investments compare with other forms of investments.  We have a shaort video tutorial available on youtube.

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Lesson Posted on 20/02/2017 Intraday Trading (Stock Markets) classes

Use Dow Theory while Doing Trading

DHANANJAY DEWARE

I have 12 years Experience in Stock Market as Trader and Technical Analyst. In my teaching style, Basics...

Use PSII method for trading. P = Primary Trend S = Secondary Trend I = Intermiditirary Trend I = Intra TRNED. For Buy On Dip Use For Intra: P = BUY, S = BUY=, I= BUY, I = SELL For Positionals: P= BUY, S= BUY, I= SELL, I= SELL read more

Use PSII method for trading.

P = Primary Trend

S = Secondary Trend

I = Intermiditirary Trend

I = Intra TRNED. 

For Buy On Dip Use For Intra:

P = BUY, S = BUY=, I= BUY, I = SELL

For Positionals:

P= BUY, S= BUY, I= SELL, I= SELL

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Lesson Posted on 11/02/2017 Financial Planning/Stock Market Investment Financial Planning/Stock Market Investment/Fundamental Analysis Intraday Trading (Stock Markets) classes +1 Derivatives Trading classes less

Understanding Stock Market Dynamics

Prathuish G

I been in the field of finance for 10 years. Joined for Indian Chartered Accountant Course in 2007...

1.UNDERSTANDING MARKET Imagine a Cake Bakery with Staring Kitchen = Primary Market Counter Sales = Secondary Market Cafeteria lounge = Futures Market What happens in Cake Bakery Kitchen? Baking cake off course Here they would acquire ingredients to make a cake these would be Sugar Butter Flour Eggs Milk Baking... read more

1.UNDERSTANDING MARKET

Imagine a Cake Bakery with

Staring

Kitchen = Primary Market

Counter Sales = Secondary Market

Cafeteria lounge = Futures Market

What happens in Cake Bakery Kitchen? Baking cake off course

Here they would acquire ingredients to make a cake these would be

  • Sugar
  • Butter
  • Flour
  • Eggs
  • Milk
  • Baking powder

Kitchen can be compared to Primary market, where Initial Public Offerings are done by company. If you are imagining each company as a new cake to be made, for each cake different ingredients has to be bought whenever a cake is made. So in reality our ingredients be like

  • Sugar - High Net-worth Investors
  • Butter -Investment Banks
  • Flour- Domestic Institutional Investors
  • Eggs-Retail Investors
  • Milk -Foreign Institutional Investors
  • Baking powder- Promoters

As like cake, combination of different companies can be made with different ratio of participation from different segment. There could be an infinite number of combinations from these; hence you can make any type of cake as long as you will be able to find ingredients for the same.

Now you have your cake baked and ready

Now you can place it on the glass shelves on counters, so that others can come and see the cake and if they like it, they could buy the same. In general here in this bakery only cake pieces are sold. You can later call them ownership shares in cake.

So this cake is ready for display, unlike regular price tag, this cake pieces owners would be the people from Kitchen, each ingredient would be carrying his particular share in the pieces of cakes. 

Price of Cake would be

The price would be determined by an agreement arrived by what the ingredient holders ask and what counter shop customers are willing to pay. This would be a regular auction, when they meet on price both agree a piece of cake is sold. Now the person who bought the cake is the owner of that particular piece, he can keep it in his plate or he can sell them to others if others are willing to buy.

Counter Sales

Good cakes would be valued more

Some cakes are big 1 Kg or some are 10 Kg, different types are available

Some cakes are chocolate, some are vanilla, some are exotics

So this would be your secondary market ,which everyone says as stock market in general term ,when people say that you are going to invest in shares, it in a general sense means to be a counter customer . It’s unlikely someone who new to all this gets a chance to kitchen, even though it’s permitted.

Take Away

Piece of cake = Shares /Stocks of company

Price of it= Share Price

Price*Total Number of Pieces = Market Value of Company 

So far I hope you understood

What is Primary Market?

What is Secondary Market?

Now let’s move into Cafeteria lounge

They are the people who speculate whether a cake would rotten or not.

People are different here

they would offer you a specific menu

  • you can buy this menu
  • you can hold this menu
  • you can sell this menu

Price of this menu you hold would be based on the cakes it has in menu

But remember there is no actual cake

So all day they be selling this menu back and forth based on the cakes in the list 

Then there are others Menus which would be a menu based on the menu said above it too would be bought and sold as people in cafeteria agree.

Now imagine cafeteria as Futures & Options Market

First degree menu is - Futures Contracts

Second Degree menu is - Option Contracts 

Take Away

Futures & Options Market Trades contracts

Based on shares, in the scenario we build cake pieces at counter sales

There are no cakes in cafeteria that means nobody brings the shares to futures and options, these are promises.

General Conditions

To enter this Bakery house you need a trading account with a broker.

From kitchen they can kick you out as they like it

To enter cafeteria you need special permission

All this would only portray a general infrastructure of the market; in upcoming contents we would discuss details into the operations of these specific financial instruments and their uses and purposes.

 

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Lesson Posted on 26/12/2016 Financial Planning/Stock Market Investment Fundamental Analysis (Stock Markets) Intraday Trading (Stock Markets) classes +3 Financial Planning/Stock Market Investment/Fundamental Analysis Financial Planning/Stock Market Investment/Technical Analysis Financial Planning/Stock Market Trading less

As a student, is it fine to trade in stocks with a broker?

Kushal Jain

Teaching trading from last 1.5years Have taught more than 30+ students Named as youngest technical...

I started trading when I was student, so my answer to this question is a definet YES.As a student you dont have any financial burdens or family responsibilities on your shoulder so you can experiment in this field without worrying much about your career.I personally feel student time is the best time... read more

I started trading when I was student, so my answer to this question is a definet YES.
As a student you dont have any financial burdens or family responsibilities on your shoulder so you can experiment in this field without worrying much about your career.
I personally feel student time is the best time to start trading and analyse yourself whether you are capable enough of taking it seriously or if it is not your cup of tea. When I started trading, I lost money in the initial stage but I kept on trading by adding more funds and by the end of one year in trading world, I was earning far better than the best package of my college.
I would strongly recommend you to open a demat account and go ahead and enter to the trading world, even if you fail here, you always have your degree as a rescue, and if you do well here, you can start making money on your finger tips.
After getting into corporate world due to lack of time and increased family responsibility one can never pursue their interests, thus keep experimenting as student.

Hope my answer will help you.

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Lesson Posted on 12/12/2016 Financial Planning/Stock Market Investment Financial Planning/Stock Market Trading Fundamental Analysis (Stock Markets) +1 Intraday Trading (Stock Markets) classes less

Reserve Bank of India (RBI) - Tools and measures it takes

Sravn Financial Services

Learn everything from the basics of the Stock Market to Investments and Trading strategies in our tailor-made...

The Reserve Bank of India (RBI) uses the monetary policy to manage liquidity or money supply in a manner that balances inflation and at the same time aids growth. RBI has now infused a 125-basis point repo rate cut since 2015, which is now expected to be translated into lower lending and deposit rates... read more

The Reserve Bank of India (RBI) uses the monetary policy to manage liquidity or money supply in a manner that balances inflation and at the same time aids growth. RBI has now infused a 125-basis point repo rate cut since 2015, which is now expected to be translated into lower lending and deposit rates from banks. Here’s a look at the tools RBI uses to manage monetary policy.

Repo And Reverse Repo Rate:
Repo is a transaction wherein securities are sold by the RBI and simultaneously repurchased at a fixed price. This fixed price is determined in context to an interest rate called the repo rate. The transaction is relevant for banks; when they need funds from the RBI, the central bank repurchases the securities. The higher the repo rate, more costly are the funds for banks and hence, higher will be the rate that banks pass on to customers. A high rate signals that access to money is expensive for banks; lesser credit will flow into the system and that helps bring down liquidity in the economy. The reverse is the reverse repo rate, which banks use to park excess money with RBI.

Cash Reserve Ratio (CRR):
This is the percentage of a bank’s total deposit that need to be kept as cash with the RBI. The central bank can change the ratio to a limit. A high percentage means banks have less to lend, which curbs liquidity; a low CRR does the opposite. The RBI can reduce or raise CRR to tighten or ease liquidity as the situation demands. At present, CRR is at 4%.

Open Market Operations:
This refers to buying and selling of government securities by RBI to regulate short-term money supply. If RBI wants to induce liquidity or more funds into the system, it will buy government securities and inject funds, and if it wants to curb the amount of money out there, it will sell these to banks, thereby reducing the amount of cash that banks have. RBI uses this tool actively even outside of its monetary policy review to manage liquidity on a regular basis.

Statutory Liquidity Ratio:
This is the percentage of banks’ total deposits that they are needed to invest in government approved securities. The lesser the amount of SLR, the more banks have to lend outside.

Bank Rate:
This is the re-discounting rate that RBI extends to banks against securities such as bills of exchange, commercial papers and any other approved securities. In recent years, it has been the repo rather than the bank rate that has acted as a guideline for banks to set their interest rates. Directionally, bank rate follows repo rate.
In addition to these measures, RBI also uses many qualitative tools to regulate credit flow and cost of credit to the economy and specific sectors within it.

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Lesson Posted on 08/12/2016 Financial Planning/Stock Market Investment Intraday Trading (Stock Markets) classes Financial Planning/Stock Market Trading

TRADING IS PURE BUSINESS-ANYONE CAN LEARN AND DO IT AS BUSINESS

Jai Hari Shankar P R

Would like to help, who are looking to earn money in stock market, by teaching them the proper way to...

TRADING IS PURE BUSINESS-ANYONE CAN LEARN AND DO IT AS BUSINESS. AS WE ALL KNOW ANY BUSINESS WITHOUT PROPER PLAN IS A FAILURE.THIS SAME APPLY TO INVESTMENT AND TRADING BUSINESS.WE SAY IT AS PLAN YOUR TRADE AND TRADE YOUR PLAN.BEFORE ENTERING A TRADE PROPER PLANNING IS REQUIRED.WHERE EXACTLY TO ENTER... read more

TRADING IS PURE BUSINESS-ANYONE CAN LEARN AND DO IT AS BUSINESS.

AS WE ALL KNOW ANY BUSINESS WITHOUT PROPER PLAN IS A FAILURE.THIS SAME APPLY TO INVESTMENT AND TRADING BUSINESS.WE SAY IT AS PLAN YOUR TRADE AND TRADE YOUR PLAN.BEFORE ENTERING A TRADE PROPER PLANNING IS REQUIRED.WHERE EXACTLY TO ENTER A TRADE,WHAT WILL BE THE STOP LOSS AND WHAT WILL BE THE POTENTIAL EXIT SHOULD BE IDENTIFIED BEFORE ENTERING A TRADE. THIS SIMPLE STEP ELIMINATES MOST DOMINATING FACTOR IN THIS TRADING BUSINESS WHICH IS GREED AND FEAR.IDENTIFYING POTENTIAL AREA OF BUYING AND SELLING IS THE KEY. 

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Lesson Posted on 05/12/2016 Intraday Trading (Stock Markets) classes Fundamental Analysis (Stock Markets)

Tips for Stock Market Trading- IntraDay

Hanamant Kullur

I am a Professional Trader, Trainer and Technical Analyst with more than 4+ years experience. I do Teach...

Never let a profitable trade turn into a loss, and never let an initial trading positions turn into a long-term one because it is at a loss. Don't buy a stock simply because it has had a big decline from its high and is now a "better value", wait for the market to recognize "value" first. Don't average... read more

Never let a profitable trade turn into a loss, and never let an initial trading positions turn into a long-term one because it is at a loss.

Don't buy a stock simply because it has had a big decline from its high and is now a "better value", wait for the market to recognize "value" first.

Don't average trading losses, meaning don't put good money after bad. adding to a losing position will lead to ruin.ask the noble laureates of long-term capital management.

As long as a stock is acting right and the market is in gear,don't be in hurry to take a profit on the whole position.scale out instead.

The stock market is never obvious. it is designed to fool most of the people,most of the time.

Play the market only when all factors are in your favor. no person can play the market all the time and win.there are times when you should be completely out of the market,for emotional as well as economic reasons.

"It's not the ones that you sell that keep going up that matters.It's the one that you do not sell that keeps going down that does"

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