CA Pawan Jajoo, Amravati
+ Stock Market are subject to Market Risk.
+ Do the Fundamental analysis and review past performance.
+ Read and understand basic Terminology of stock Market.
+ Strictly adhere to Stop loss.
+ Before entering in to trade analyze stocks on the basis of Technical indicators – moving average, Oscillator, Trend line, Trend Channel Patterns don’t Trade against the trend.
+ When people are selling be a buyer. When people are buying be a seller.
+ Avoid purchase of stocks when market value of that stock crash.
+ Stop loss & Exit to be decided before entering in to the trade.
+ Do not have any sentimental attachment with any stock.
+ Periodic Profit booking to be done by selling and re-purchase of stocks.
+ Do not over trade. Trade only up to 50 % of your Trading capital.
+ Fix your return, and exit as soon as you get your return, Don’t be too greedy.
+ Do not trade on the basis of rumors.
+ It is better to follow Monthly stop loss and stop loss or trade.
+ Do not keep all your stock holdings in same sector, distribute your investment to various sectors i.e. Diversification of investment to be done.
+ Do not invest more than 10% value of your Trading capital in any single stock.
+ Buy the stocks whenever there is some bad news and sell the stocks whenever there is good news.
+ You always have to have cash, especially when no one else has it.
+ No free lunch- it’s not free, or it’s not lunch.
+ You can’t change people! You can change yourself, but not others.
+ Volatility is not risk
+ always assume you will have bad luck
+ Few variables to win. Once you have to think about more than 3 variables, your odds of winning are low.
+ If you have to use more than 6th grade math, you’re in trouble.