Friday, August 6, 2010

Missing retail

Why have all the retail investors gone?

Retail is gone because they think the whole thing is rigged. High frequency trading, insider information, overpriced IPO's, manipulation in mid + small caps, and the like all contribute to the feeling.

Then there is leverage. The average trader can trade 10 times more than his money in futures,  and lose money faster than ever before. Too bad nobody realized that these things are mathematically defined to lose money.

So, can we make money? Sure we can. Stocks and F&O have their place and I am not going away just yet. But let's take them for what they are - manipulated markets.


Nikhil said...

Sir, for an option writer, risk is theoretically infinite. but in practice how much does he risk? can u show me with the help of an example?

Savita and Ajay Khandelwal said...

When YOU say what you have said in these two blogs, my conviction is strengthened that markets are indeed manipulated

Intraday Analyst said...

I love manipulation. They may be manipulated but not randomly. Making money in mid caps/momentum stocks is 10 times easier than futures. Just pick some midcaps who gave breakout today, and next day buy at buy signal with very very small stop loss. And on buy signals these manipulated stocks rally like mad, n give 2-3% profits in 10-30 seconds. I have been doing this since many months. Once crossing yesterday's highest high or any important fibonacci level, they rally with huge volumes without looking back