PROFITABLE TRADING STRATEGY IN VOLATILE TIMES FOR SMALL INVESTORS: WWW.ASHOKSHARMA.CO.CC
As said earlier 2010 will be the most profitable year for investor’s especially in India. But most of the investors have missed the previous rally. Now it is high time to learn from past mistakes, Markets has nearly doubled in last 18 months, was your investment doubled? If your answer is no then go ahead and read the article.
- The most important thing: believe in the market and go along with it, never try to
Predict the market.
- Pick a stock based on its future potential do not give undue importance to P/E,EPS etc
- Technical analysis works for a very short period and in a stable market.
- Learn to book profit in a very strict manner and more important restrict your losses within your bearable limit with strict stop-loss.
- Never buy a stock because of a news or recommendation on TV,MEDIA as positions are built in same stocks prior to releasing the news in media in most of the cases,
- Build a wholesome portfolio so that loss will be minimal if some pick goes wrong. Never invest more than 10% of your investible fund in a single stock and 25% in a single sector.
- Invest 50% in large cap, 35% in midcap and rest keep rotating in intra or positional trade.
- Learn the art of portfolio churning at regular intervals as per your investment style and after a major event like Result, Budget, Election etc.
- Never overtrade in margin. Ideally not more than 10% of your capital is deployed in margin trade in volatile times like this.
- Invest in sunrise sectors in 2010 like Education, logistic, media, power, allied-infrastructure and so on.
- Protection of capital should be your first priority. Trade only when you are 100% sure about your decision.
- Share trading now a day become a highly sophisticated job requiring professional knowledge with adequate time to manage your trade, if you lack any of these do not hesitate to take services of professionals.
HAPPY WEEKEND
