Reliance Life Insurance Project Essay

Many people manoeuver to c eaching in the mistaken thought that it is the simplest way of do money. Far from it, I remember it is the easiest way of losing money. There is an old Wall lane adage, that the easiest way of making a small fortune in the grocerys is having a crowing-mouthed fortune. This feeble is by no means for the faint hearted. And, this battle is not won or lost during transaction hours but before the marts open but through a condition approach to work.1. A no-hit dealer has a commerce plan and does his homework diligently Winning principals diligently maintain charts and make unnecessary aside some(a) hours for market analysis. Every as yeting a winsome dealer updates his notebook and writes his protrudeline for the succeeding(a) day. Winning traders establish a sense of the markets main trend. They identify the strongest sectors of the market and then the strongest stocks in those sectors. They know the level they are going to enter at and a pproximate tar delineates for the anticipate move.For example, I am willing to hold till the market is acting rectify. Once the market is ineffective to hold certain levels and breaks crucial supports, I book earnings. Again, this depends on the type of market I am dealing with. In a strong up trend, I want the market to throw me out of a profitable trade. In a mild up trend, I am a piffling more cautious and try to book profits at the first sign of weakness. In a choppy market, not notwithstanding do I trade the get outest, I book profits firearm the market is still moving in my direction. Good technical traders do not worry or debate about the news flow they go by what the market is doing. 2. A successful trader avoids over concernOver occupation is the single pornographicgest malaise of most traders. A disciplined trader is everlastingly ready to trade light when the market turns choppy and even not trade if there are no trades on the horizon. For example, I trade full steam solely when I see a trending market and reduce my trading stakes when I am not confident of the expected move. I reduce my trade even more if the market is stuck in a choppy mode with very small swings.A disciplined trader knows when to build positions and step on the gas and when to trade light and he can only make this assessment after he is clear about his analysis of the market and has a trading plan at the beginning of every trading day. 3. A successful trader does not get unnerved by lossesA winning trader is always cautious he knows to each one trade is just an some other trade, so he always uses money deliver the goodsment techniques. He neer over leverages and always has set-ups and rules which he follows religiously. He takes losses in his stride and tries to understand why the market moved against him. Often you get important trading lessons from your losses. 4. A successful trader tries to capture the large market moves Novice traders often book profits too qui ckly because they want to enjoy the winning feeling. Sometimes even on the media one hears things like, You never lose your shirt booking profits. I believe novice traders actually lose their account equity quickly because they do not book their losses quickly enough. Knowledgeable traders on the other hand, will as well lose their trading equity though slowly if they are satisfied in booking small profits all the time. By doing that the only person who can grow rich is your broker.And this does happen because, inevitably, you will have periods of drawdowns when you are not in sync with the market. You can never cover a 15-20 per cent drawdown if you keep booking small profits. The crush you will do is be at breakeven at the end of the day, which is not the goal of successful trading. A trading account that is not growing is not sustainable. Thus when you believe you have entered into a large move, you direct to ride it out till the market stops acting right. Traders with a lot of companionship of technical analysis, but little experience, often get into the quagmire of following very small targets, accept the market to be overbought at every small rise and uniformly so in all markets. Such traders are unable to make money because they are too smart for their own good. They allow to see the phase of the market. Not only do these traders book profits early, sometimes they even take short positions believing that a correction is due.Markets do not generally correct when department of corrections are due. The best policy is to use a trailing stop loss and allow the market run when it wants to run. The disciplined trader understands this and keeps stop losses wide enough so that he is balanced between staying in the move as nearly as protecting his equity. Capturing a hardly a(prenominal)er large moves every year is what really makes worthwhile trading profits. 5. A successful trader always keeps evolveingYou cannot learn trading in a day or even a f ew weeks, sometimes not even in months. Successful traders keep reading all the new research on technical analysis they can get their hands on. They also read a name of books every month about techniques, about trading psychology and about other successful traders and how they manage their accounts. I often like to think about traders as jehadis unless there is a fire in the belly, unless there is a strong will and commitment to win, it is impossible to win arrangedly in the market.6. A successful trader always tries to make some money with less risky strategies as well Futures trading, for example, is a very risky business. The best of chartists and the best of traders sometimes fail. Sure, it gives the highest returns but these may not be consistent and the drawdowns can be large. Traders should always remember that no matter how good your analysis is, sometimes the market is not willing to oblige. In these times the 4-5 per cent that can be earned in covered calls or futures and cash arbitrage comes in very handy. It improves the long term sustainability of a trader and keeps your profit register ringing. Traders must learn to live with lower risk and lower return at certain times in the market, in order to protect and enlarge their capital. Disciplined traders have fair(a) risk and return expectations and are open to using less risky and less exciting strategies of making money, which helps them tide over rough periods in the markets.7. A successful trader treats trading as a business and keeps a positive attitude Trading can be an expensive adventure sport. It should be treated as a business and should be very profit oriented. Successful traders review their consummation at regular intervals and try to identify causes of both superior and inferior performance. The focus should be on consistent profits rather than erratic large profits and losses. Also, trading performance should not be made a judgement on an individual rather, it should be considere d a consequence of right or handle actions. Disciplined traders are able to identify when they are out of sync with the market and need to reduce position size, or keep off altogether.Successful trading is like dancing in rhythm with the market. Unsuccessful traders often cut down on all other expenses but disdain to see what might be wrong with their trading methods. Denial is a costly attitude in trading. If you see that a particular trade is not working the way you had expected, reduce or avoid your positions and see what is going on. Most disciplined and successful traders are very humble. Humility is a law that traders should learn on their own, else the market makes received that they do. Ego and an I can do no wrong attitude in good times can lead to severe drawdowns in the long term. Also, stinky days in trading should be accepted as cheerfully as the good ones. So disciplined traders maintain composure whether they have made a profit or not on a particular day and av oid mood swings. A good way to do this is to also participate in activities other than trading and let the mind rest so that it is fresh for the next trading day. 8. A successful trader never knocks the marketDisciplined traders do not blame the market, the government, the companies or anyone else, conveniently excluding themselves, for their losses. The market gives ample opportunities to traders to make money. It is only the traders fault if he fails to recognise them. Also, the market has various phases. It is overbought sometimes and oversold at other times. It is trending some of the time and choppy at others. It is for a trader to take maximum advantage of favourable market conditions and keep away from discriminatory ones. With the help of derivatives, it is now possible to make some money in all kinds of markets. So the trader needs to look for opportunities all the time. To my mind, the important keys to making long term money in trading are * Keeping losses small. Rememb er all losses start small* Ride as many big moves as possible* Avoid overtrading.* Never try to impose your will on the marketIt is impossible to practice all of the above perfectly. However, if you can practice all of the above with some degree of success, improvement in trading performance can be dramatic. 9. A disciplined trader keeps a cushionIf new traders are lucky to come into a market during a bunce bull phase, they sometimes think that the market is the best place to put all ones money. But successful and seasoned traders know that if the market starts acting differently in the future, which it surely will, profits will stop pouring in and there might even be periods of losses. So do not commit more than a certain amount to the market at any wedded point of time. Take profits from your broker whenever you have them in your trading account and stow them away in a separate account. I say this because the market is like a deep and big well. No matter how much money you put i n it, it can all vanish. So by having an account where you accumulate profits during good times, it helps you when markets turn unfavourable.This also makes drawdowns less stressful as you have the cushion of previously earned profits. Trading is about walking a tightrope most times. Make sure you have enough cushion if you fall. 10. A successful trader knows there is no Holy grail in the market There is no magical key to the Indian or any other stock market. If there were, investment banks that spend billions of dollars on research would snap it up. Investing software and trading books by themselves cant make you enormously wealthy. They can only give you tools and skills that you can learn to apply. And, finally, there is no free lunch every trading penny has to be earned. I would root on that each trader identify his own style, his own patterns, his own horizon and the set-ups that he is most wanton with and practice them to perfection.You need only to be able to trade very few patterns to make consistent profits in the market. No gizmos can make a difference to your trading. There are no signals that are always 100 per cent correct, so stop looking for them. Focus, instead, on percentage trades, hard to catch large moves and keeping your methodology simple. What needs constant improving are discipline and your trading psychology. At end of the day, money is not made by how complicated-looking your analysis is but whether it gets you in the right trade at the right time. Over-analysis can, in fact, lead to paralysis and that is death for a trader. If you cant pull the trigger at the right time, then all your analysis and knowledge is a waste.