Saturday, 27 February 2016


The internet is full with websites teaching how to trade and what rules to follow.
But the greatest nemesis is that even though one knows what to follow, he is not able to follow.
Here we will try to share how we do it. Of course, first step will have to be taken by the trader because without the first step, no journey gets completed.
We faced the same issues during our journey, and had to tackle this issue all by ourselves.
We were constantly facing the problems with our minds during active trading like not following the rules we had laid down ourselves. So what we did was that we had them produced in written form and put them up at various places.....on the facing wall of the trade station, on the wall towards the foot side of the bed, and even in the toilet. The idea was to constantly keep reminding us the rules so that they gradually sink in to the spinal levels. Its something which school kids do..with their tables and charts which have to be memorized.
And yes, it gave the results, though gradually.
The first step to be taken by the trader is to formulate a strategy in written comprising of the following aspects. Believe us it will take a pretty long time and lots of observations, calculations and analysis, and of course PATIENCE:

  1. When to enter a trade...define your parameters
  2. What would be the stop loss....define parameters as a fixed percentage of loss on the capital at risk
  3. What would be the profit target....define parameters as a fixed percentage of returns on the capital at risk
  4. Set up a monthly target in terms of fixed percentage of returns on the trading capital
  5. Divide that into weekly targets 
The above steps would need a lot of back testing as well as paper trading. Once you are through with this step, you are ready for the next step.

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