LOVE SEX AUR DHOKHA & TRADING - I

LOVE SEX AUR DHOKHA, that2in trading.

Absolutely yes my friends. Love sex & dhokha is my new finding in equity trading. Its another matter that this terminology is known as LIMIT, LEVERAGE & LOSSES to us. L8 me try & explain how it goes.......................

L8 us all discuss about d LOVE first :

Le8 us all first try & understand How does share market attracts a common man.No doubt v all got a deep desire 4a quick & easy money n v keep searching all d time 4d same. Media plays a significant role 2make a common man think that share market is an easiest place 2make quick money. well, 2me its a hidden agenda. Hidden agenda of newspapers, business channels, tv analysts ( or ne kind of analysts ), brokerage houses, tips providers,operators, lead managers, FIIS, DIIS, advisory service providers etc etc. This cartel gets benefited only if fresh money keeps kicking in2 share markets as v all know game remains d same only players change. Media plays d role of creating d hype about the rise of already inflated share market with d headlines like " XXX points rise in share markets ", ABC company mcap rose _ _ _ crores in a single day ", " XYZ company investors made rich by !@#$ Crores in a single day ", " IPO lists with XX % premium on first day " etc etc. They all somehow create a scene like this all will keep going like this & share market is never gonna fall . This hype produces a LEFT OUT kind of feeling in a layman , thus making him entering d share market in a hurry without proper guidance, understanding & preparations.

This is how LOVE develops in a common man.

Let name our lay man as pappu. Pappu after establishing share market as a place2 fulfill all his dreams, plans 2start trading. Through all d inadequate information he gets from all d "pappus" around him, he starts searching 4brokers 2start his innings. Following are d points he considers important 4his broker.

1. Brokerage - pappu, in the initial stages of trading thinks lower my brokerage is, higher is my earning . Looks 4a low brokerage broker.

2. Leverage - Pappu always wanted 2hold 10 rs. stock with only 1 rs. in his kitty.As he thinks with a rise of 5 % in a stock his 10 rs. holding can give him a profit of 50 % on his 1 re capital. That s why first thing ( preferred even over d brokerage ) which matters for pappu is leverage. & he would always chose a broker who provides him rich leverage ( even upto 10 X ).

3. Holding period - Pappu dreams, the longer his broker let him hold d stock, more would b his profit. So, d third point matters 4him, is d cycle being facilitated by his broker 2him. It varies from T + 1 to upto T + 7 with broker 2broker. .

4.Tips - With a no no knowledge of share market, pappu always looks 4a broker who can lead him with " ready 2eat " kind of tips, which can fulfill his fancies with ease.

As soon as pappu's hunt 4a broker of his kind finishes he starts trading with a nominal margin amount he has......

This is how Pappu's AFFAIR 2wards share
market starts taking shape...........

P.S. - BEL - forgot 2mention in last post, a handsome 7 % return already, more2come, hold now with a TSL of 1750, conservative keep a sl of 1785

P.S.2 - As this is too long a story that how pappu's love 2wards market turns into SEX & then a DHOKHA, it would be presented before all of you in several episodes.

P.S. 3 - Related articles ( pl go through following relevant write ups also ):

1.-http://stock2gains.blogspot.com/2010/06/what-is-your-trader-type.html
2.-http://stock2gains.blogspot.com/2010/06/why-to-put-stop-loss.html
3.-http://stock2gains.blogspot.com/2010/06/trade-summary-functioning-of-volume.html

Till then HAPPY SAILING.

Om Sai Ram.