𝗧𝗛𝗘 𝗢𝗣𝗧𝗜𝗢𝗡𝗦 𝗧𝗛𝗥𝗘𝗔𝗗-𝟮
So we had discussed a few pointers in the previous thread about options,its time now we discuss further implications and applicability in this thread which will help you in NEW YEAR.
Let’s go and dive into the world of options trading.

Books on trading which every SERIOUS TRADER should read
⚡Trading in the Zone : Mark Douglas
⚡Market Wizards : Jack D.S.
⚡Technical Analysis : J.Murphy
⚡How to make money using charts : Ashwini Gujral
⚡Japanese Candlesticks : Steve Nison
⚡ Reminiscence of a stock operator

𝐓𝐨𝐩 𝐑𝐞𝐚𝐬𝐨𝐧𝐬 𝐰𝐡𝐲 𝐓𝐫𝐚𝐝𝐞𝐫𝐬 𝐅𝐀𝐈𝐋!!
This thread is about the top reasons why most traders fail. If you want more finance and business related threads on regular basis,don't forget to retweet and share with your friends.

1. Negligence of risk management
While we can't foresee what the business sectors will do before long, hours, or days, however we do have full power over our danger levels at some random time. Risk management not just includes stop loss but also avoiding unnecessary trades.

2. Not having it planned out
A philosophy, or set of rules, is necessary. The business sectors can be tumultuous and confounding, particularly for somebody without a particular game plan that can be utilized over and over. Hence,planning essentially is going to help in any case.

3. Wanting to be always right
Numerous unpracticed informal investors center a lot around their triumphant rate. There will be times when you'll question your trading abilities, or even think whether trading is the correct occupation for you. No one is right always,cut losses.

4. Bad risk-to-reward ratio
There are two reasons traders end up with a poor risk-to-reward ratio:
a. They don't have an exit plan and rather essentially respond to the market without doing maths.

b. They can't hold their winners… yet they hold their losers.

Banknifty has formed : BKBA pattern
Bhangarh ki bechain Aatma Pattern
Even kids know what happens next!

On average, the market performs the poorest in September.

The Important Thread⚡
Writing this thread because this is the need of the hour. If you belong to investing/trading community,read it till the end and do help in spreading awareness by RETWEETING this post if you too relate and want to help those affected.
THE TRADING PROFITS👇

These days you must have seen several traders posting profits,beyond imagination. There are 3 obvious thoughts that too in sequence -
🙂Are they even Real?
🙂Why am I not able to do so?
🙂What the hell am I doing with my life?

Preparing for that gov exam or looking for that private job or even running a business,which is going to pay me just 1/10th of these profits in my entire lifetime?!! Damn,I guess trading is the ONLY thing I need to do.
👉Result : Anxiety,Fomo and feeling of self pitty.

Now to the first question,if they are real or not,yes although social media is filled with fake screenshots,edited profit videos and false p&l,let me tell you that there are SOME GENUINE TRADERS also out there.And to rest all the rumours,YES SOME OF THOSE PROFITS ARE REAL TOO...

👉But then the question is,why are you not able to do so? Instead,the moment you attempt to do so,you are either frustrated or one step closer to bankruptcy?
The reason is the ABILITY to take risk,which differs in both the cases. Let me explain:(Read next)👇

While watching the GameStop stuff has been mildly hilarious (I mean who doesn't like watching the financial elite squirm?) it's pretty clear that a whole bunch of folk have convinced themselves this is ACTUALLY some kind of revolutionary activity. It isn't. 1/

Sure, it's highlighted yet another way in which the bastards profiteer but that's about it, stick it on the pile with the fifty other pro tips to keep the poor, well poor... It's todays banter and tho a few folks might have egg on their faces, literally nothing will happen. 2/

GameStop's three largest shareholders have earned £1.5bn+ during this. They sit at the top of some 200 institutions which are rolling. Meanwhile the ersatz rebels are now watching the bubble, realising there is profit to be made and having a wibble. 3/

No doubt some TRULY believe they are taking part in some kind of revolution but frankly it's utterly absurd and the vast majority are in it for the lulz and to cash in quick.

I'm sorry to tell you this, but you don't own GameStop.

4/

The reality is, the scale of the economic disparity and corruption is simply vast. Billionaires loosing a few millions means nothing. They buy one less yacht and you continue to live meal to meal.

The "Free Market" changes a few systems and the abuse continues. 5/

Circle of Competence 101

Warren Buffett and Charlie Munger often reference the importance of knowing the boundaries of your circle of competence.

But what is a Circle of Competence and how does it work?

Here's Circle of Competence 101!

1/ First, a few definitions.

A Circle of Competence is the set of topic areas that align with a person's expertise.

If the entire world of information were to be expressed in a circle, an individual's Circle of Competence is the small sub-circle that represents their expertise.

2/ The idea surfaced in the 1996 BH annual letter.

"You don’t have to be an expert on every company...you only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital."

3/ A Circle of Competence is built over time.

It is built through experience, reading, dedicated study, and effort.

It is dynamic, not static.

It can expand as you deepen your knowledge in new areas. It can contract if you fail to nurture your existing areas of expertise.

4/ To engage this mental model in your life, there are two key processes to go through:

(1) Identify what falls within your circle
(2) Identify the boundaries of your circle

(1) is all about figuring out what you know, while (2) is about humbly admitting what you don’t.

A THREAD ON SL, TSL AND RE-ENTRIES-

WHERE TO PUT THE SL-

1. NEAREST PIVOT/SWING POINTS-

Normally I use this method for placing sl, In this method we use swing point for placing the SL.

As normally the stock would not try to go below previous swing point if it is to go in our direction.

2. ATR method-

Sometimes the Stock do not have any nearest pivot at time of buy, So we use this method as it gives us a level on basis of current volatility of the stock.

I use 1.5 ATR away sl , say the ATR at point of entry is 30, so I place sl
1.5 X, or 45 rs away from entry

In below example the entry is 120, ATR=5, SL= 1.5X ATR= 7.5 OR 113.

Nearest pivot was too far away, that’s why this method is used in these cases.

4. Anchor candles-

Anchor bars are those which have extreme Volume, gaps or wide Ranges.

Here, we place our sl below those candles which has the above characteristics.

As part of our Knowledge sharing initiative by @FinnacleAcademy and @Investmentbook1, here we are on our post 2 with some of the most important key takeaways of the book “Masterclass with super investors” by @vishalmittal22 & @basrars

Here we go! (1/n)

Masterclass with super investors is one of the best books covering the investment strategies & journey of renowned domestic investors. Our summary has been segregated in 2 parts, A) Common traits in investment ideologies of these stalwarts B) Investor specific key takeaways (2/n)

A)Let's look at a few common points in these Stalwarts' investment ideologies 1)Invest (higher % of portfolio) when you have conviction backed by sound logic 2)You need to be bullish on India to make investments in Indian cos. bcoz majority of Indian cos. are domestically focused

3. New Bull markets have new leaders when a bull markets ends the stocks which have gained the most falls the most 4. The entry price that you pay for a company should be very cheap so that even if your assumptions go wrong in future you don't end up losing money (4/n)

5. We get attached to stocks which have given us a lot of returns in past even though in current & future expected scenarios they seem overvalued 6. Focus on art of disciplined selling-it's imp. to have a sound selling mechanism just buying at right price wont create wealth.(5/n)

How to Avoid Big Losses In trading ?

1. Avoid Stocks Below 200 ema
2. Sell Stocks in Stage 4 Down Trend
3. Dont Trade Stocks that are moving in Circuits
4. Avoid News based Trading

A thread With examples🔖

Retweet to Educate Your Trading Friends !
1/n

A Study Shows that 90% of the winning Stocks stay above 200 ema before a big Advancing Phase

1. Simply Not Holding or Buying Stocks below 200 ema Saves a lot of time and Money.
2. You can looses opportunity Cost if you buy stocks below 200 ema.
3. TimeFrame: Daily 200 ema

2/n

B. Sell Stocks in Stage 4 Down Trend

1. Stocks Exhibiting this are in complete Bear Grip
2. The 30 week ema acts as reference for stage analysis
3. These Stocks can be short sold on pullback to 30wema
4. Happens after Topping Phase
5. TimeFrame : Weekly , 30 Week Ema

3/n

C. Dont Trade Stocks that are moving in Circuits

1. Mostly these stocks are Speculatve and Operator Driven.
2. You never know what is the top of the trend and may get Stuck with Huge Losses

Example : TTML , Alok , Ruchi etc
This is Pyramid Structure and news driven also
4/n

D. Avoid News based Trading
1. Whenever a postive News comes in Market People Jump in Buying the Stocks without thinking .
2. Most of the the times the news is factored in or gets factored after heavy buying
3. Your Money may get Stuck

Example : PnbBousing , AdaniPower
5/n