Friday, December 4, 2009

Falling off the Cliff

I have a message from Gaurav whome I met in Chennai and Bangalore. Gaurav has an excellent job. But he is fond of trading.This is what he writes:

"One of my friends brother is an arbitrager for last 10 years.He told me that he can arrange a trading job but first 3 months I have to just monitor may be they will give me 5000 to 7000.And I am OK with that because may be after 6 months I can get a salary of 12-15K which is 50% of my current salary,but still I will be happy with that.And simultaneously I will trade for my own account"

My Notes:
Have you actually seen someone fall off a cliff? Not in movies, but in real life. Well my friend Gaurav may well be planning to do so.
Arbitrage is very different from the kind of trading that thrills traders. Second, trading on your own account simply increases the risks without any reward. The reward comes to experienced, risk understanding traders. Leaving your job to trade is hardly risk understanding.

This topic had come up earlier also. My advice is:

Do NOT leave your job. Learn to enjoy what you are doing. Please do not track the markets during your work hours. Practice trading on end of day charts. Do this in your free time. Once you feel confident in your paper trades, go ahead and take actual trades on an end of day basis. When you start seeing the results of your learning, then plan to be a full time trader.

10 comments:

Aayushgx said...

Sir,

Hi,.. I am studying to be a mechanical engineer. I also invest my savings and read trading books like Mr.Gaurav above. I aspire to follow up my engineering with an MBA in finance and have a career in equities.

I would be obliged if you could advise me on how to get the experience and the risk understanding that you have mentioned above.

Thank You

Aakash Gupta

gulshan said...

Sir

I am (may be others also) waiting for your comments on question asked by men on November 30, 2009 i.e. "Mr. Sudarshan, in the cash segment it would have been a good opportunity to start a SIP as one is not bound by any time in case of a wrong decision, but for the FNO how should we carry on please suggest some way. Thanks"

Please say some words.
Thanks

gourv said...

Hello Sir,

Thanks for replying.

Regards
Gourav

Technical Analyst said...

Hello Sudarshan,

I am Technical Analyst in a broking firm at Surat. My primary job is to provide good trading calls to our clients. From last one year my success ratio is in the rang of 68%-73%. Now I want to improve it and want to learn from you. would you please provide me any learning opportunity from you?
I am also planing to appear for CFTe.
eager to learn from you......
Jasmin Akbari

men said...

Mr. Sudarshan, how should we act when we are >5160 and <5182, I was prepared to loose my position around these levels and to my luck the market turned back. Also at what levels >5180 should we consider longs if any?

men said...

We are getting different views on the market, some say 4200 will come first and others say 5700, how should we as small traders/investors react or is it just a game of chance? Also if you could give your analysis with charts on CNBC it would be really helpful, instead of entry and exit levels. Mr. Sakthi Patra has a very nice way of presenting his analysis on NDTV, his method is way ahead of CNBC.
Thanks,

mbansalicy said...

sir,
good morning,
i want to know about significance of RSI in technical anylysis.
generally we hear that a share 's RSI is above 80 then sell it & good reward come for you.
& if RSI is below 20 then buy it u earn good handsome returns.
how much corrrect in this.
how significant is RSI in technical anylysis.

Harish said...

Resp Sir,
What is the right strategy for a trade-V subscriber to trade profitably.Pls explain
Harish-Varanasi

satishhere said...

Sudarshanji ,
your Advise to Gurav is Just BEST in Market !!!!!!!!

Gourav said...

Hello Sir,
4.5 years has passed since I seek your help for trading as a career.I am happy to share that I am still in my job.Now I am in Berlin(German).I am still continuing to trade.I do not follow the market during market hours.I follow the EOD chart.And yes my P/L has improved in these 4.5 years.I always read your blog.Thanks for all your support.

Regards
Gourav