Sunday, July 28, 2013

I am too busy to trade stocks!

While most of us have one or more Demat and Trading accounts. You primarily open this account because someone has insisted you to open an account. Or you heard that investing in share market gives good returns. Or may be, just because your peers have one.

Once you are done with account opening formalities, you are eager to trade actively. Your broker is more interested in the transactions done by you, as each transaction generates him brokerage. 

He starts recommending you the stocks which are expected to move up. You are exited and you start buying as per his recommendations. 

Initial few days/months are full of excitement. You track all you shares closely. You also create a portfolio on one of the free websites to track the prices closely.

This goes on for a while.  Your schedule hardly allows you to track the portfolio regularly. 

One fine day you hear the markets are falling. You rush and check your portfolio. This is when you realize that prices of shares you bought are falling badly.

You are panic and ring up you broker. He tells you to wait in the anticipation of prices to come up. 

As the time elapses, you realize that the prices are falling further. Now, you are worried. You feel that you have been given wrong recommendations. 
If broker recommends you to buy further, you reject to do so! 

By now you lose faith in broker and eventually shares market. Slowly and steadily you start losing interest in your Trading/Demat account and eventually you loose interest in investing in stocks.

This is not unique. This happens with most of us, when we start investing in stock market.
Lets try and understand why this has happened and how this can be avoided-

Try and answer following questions-
Did you really want to invest in shares?
Did you know what time frame you are buying for?
Did you have time/patience to understand more about the companies you are investing in?
Did you have ‘proper’ resources to study the companies, the broader market, the economic cycle, the market phase?

Have you thought whether you wanted to ‘Invest’ or you wanted to ‘Trade’?
Did you have a mentor to guide you to all above?

Here is a brief attempt to throw some light on all issues above. 
We need to accept the fact that, be it investing or be it trading, you need to know, much deeper than just knowing names of few scrip’s. 

You are willing to enter the market, but are not willing (or you don’t have time) to gain knowledge about it, you will not go anywhere, but ‘northward’. Try and put exclusive time and efforts in learning the basic what, why, when and how of market.

Learn how much of your total savings to be invested in share market, how much risk you can take, what is the time frame you want to be in,  do you have psyche to trade yourself.

Finally find someone who can help you in all these things.

If you do not have time, you need to believe someone. There are many people who are extending their services at a nominal cost, it is worth the returns and learning. There are others who do the research and give you trading calls or long term investing ideas.

There is huge information available on internet, if you want to learn. You can start doing things on your own. 
Here is a list of some good books, you may find worth reading-

Have questions- put me a mail. Your comments are welcome.

Sunday, July 21, 2013

The week gone by is a learning for the ones who want to understand what the word choppy market means. The only consistency was being inconsistent. Finally Nifty failed to hold above 6050. The giant Reliance results are out & are in line with the expectations. Now what do we expect here onward? 

Bank Nifty is not willing to cooperate and has seen huge pressure. Unless Bank Nifty supports, Nifty can not move up.

Next week Thursday is expiry of this series. More companies will be announcing their results. Some them will down the index and some will try to pull it up. The choppy nature is expected to continue in the week to come.
How there are many stock which have kept their loyalty to Trend. 

Ranbaxy, after retracing 50%, started it downward journey. Safe to assume that will continue to slide till 305 and can be good short sell idea.

Read for More Ideas......................

Trading Tip for the Week: Trend is your Friend. Trade by the side of trend.

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