Sometimes, I do exit all positions when there is a parabolic spike in the account value. This happened during the recent Indo-Pak war. Re-entering multiple positions after such mass exit is difficult since there could be initial whipsaws during such crises. The better way to re-enter trades is not to re-deploy capital all at once. It makes sense to enter one position and as that position goes into profit, then enter another one. That is likely to protect capital.
May has been profitable so far. This is despite not trading for about a couple of days after Indo-Pak war started.
Grow that account of trading...don't let that account grow you,,.. Control of the mind and soul cannot be overstated. There's alot of demonic influences out there, and weaker spirits can cave in sridhgasridhga
Today, Idea shares have fallen at open. This is no surprise since they were bearish earlier. I did not have a position during the weekend. After further falling a bit after the open, they recovered to almost 3 times my normal stop loss. They started falling again between 11.15 am and 1 pm. From 1.15 pm the fall accelerated very steeply and they had fallen 7 times my stop loss within just 15 minutes. I did not lose money today in this trade. I did not stick to the whole move and exited quick as I did not want to risk much either. But the point is about the sharp moves. I did search for the news on the stock. Idea today approached the Supreme Court against the Central Government. The news was getting updated through out the day on different news websites. But all the fall had taken place in spurts of few minutes each. This is a risk when we trade companies that are in the news. Although we may end up in profits, the companies may fall or recover steeply before we could react. This is a risk to be noted and lets call this news risk. This morning, when I opened a position in Idea, I did not check the news on the company at that time. But if a scrip is in crisis, and the news is getting updated continuously, it is better not to trade the scrip until it settles down as it can whipsaw. Even if one is in profit and if the moves in just a couple of minutes are taking like 7X my stop loss, it is better to exit trades in that scrip for the time being.
Had to exit Union Bank early yesterday. This was because, I had to move money between accounts. So, I did not want any reversal whipsaw in this account. These funding and un-funding adjustments are causing lower profits because they are not letting the trade play out. I had a similar situation in BEL trade last week. I need to isolate this account from others and leave dedicated money here instead of shuffling with other accounts. For that I should work out a gradual ramp-up on pledged shares and balance it with enough surplus cash. This would let me take the risk till the trade plays out. Need to ramp this slowly up. Then with surplus profits buy more shares and still balance the account with sufficient cash in case of whipsaws or draw downs. Finally I need to detach this account with other funds so there are no distractions. I need to work on this and it is a slow process. Only then the potential of these trades could fully be realized and the account grows. Otherwise, I end up taking smaller profits than what the trade could give.
In the middle of this month, I started doing parallel trades in another account with another broker. Here, I am trading just one lot and one scrip at any given point of time. So capital deployed is just Rs. 150,000 and about half of that is funded through margin pledge of existing share holdings. So far the account is doing thus: And here is the link to that verified profit and loss account: https://verified.flattrade.in/pnl/PO4573215bee814f27932cbc5aac88a9a5 The brokerage saved number is ridiculous. They have calculated potential brokerage that another broker could have charged during the last one year since I managed this account. All these day's I was just buying shares for long term holdings. Its just this month, I started trading stock futures in here. So, currently I am working with two accounts with different brokers under this strategy.
Update on the second account with Flattrade broker. Trading started from 13th May with fund allocated Rs. 150,000. https://verified.flattrade.in/pnl/05a4abaae56d47d8a3c0e5f104a6257e So far it is working out well. Now let us look at the first account with Zerodha broker. Share capital deployed is Rs. 500,000. https://console.zerodha.com/verified/80f5c7a3 So far good now another profitable week due to Tata Steel and Eternal trades. But today (Friday) whipsawed. This does not get updated in the back-end reports until tomorrow. I don't think the week will finally end in green. Next weekend is month end too. So it would look nice if the Month of May closes green in both accounts. Let's see.
Today Eternal stock started behaving jittery since 14:15hrs till the close of the trading session. Today is not even expiry day. But it is the beginning of new period of the next expiry. I was holding since previous day about 2 lots in long position but by 2:15, it hit my trailing SL. I reversed my position and then it started behaving jittery like it had seizures or something. With high volume it moved back and forth rapidly and has taken out my SL in the new direction. I exited the position and refused to take long. Checked for news but did not find any. However there was some old news that FIIs may have to trim their holding due to limitations on the scrip two days ago and this news was already factored in. Had to exit with much lesser profit due to this. Look at the high volume during the last half hour.
Tata Steel whipsawed and so far caused losses this month. I am still holding 1 lot short position at the end of the month.
This is the Flattrade account (2nd account). Rs. 150,000 deployed for trading and it gives more than 10% in May. Started trading this since 13th May. https://verified.flattrade.in/pnl/PO5808f8c2048d47f4bc8ddc50e23ce72a