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What is Day Trading?
Day Traders usually buy and sell (or sell first and then buy)
securities (including Stocks, Bonds, Commodities, currency,
options, futures etc) during the same day and, as a general
rule, do not hold the securities overnight. They are therefore
said to have "Zero Position” at the end of the day. (However
some Brokers have started providing facility to square up the
Buy-Trades on next market day). Many Day Traders make dozens of
trades every day hoping to capture profits that arise from small
intra-day price fluctuations.
What is Swing Trading?
Swing traders usually hold a security from one day to 2 weeks or
so. Most of the swing traders concentrate on Breakouts on just a
few selected High Volume stocks that they believe will likely
make a significant move in price in the near-term.
Many people think that day trading is
just gambling. Please comment.
No! That is a misconception. Day trading has large potential
rewards, and it also has large potential risks involved.
Generally in any form of gambling the odds for winning or losing
are 50-50, where no strategy or tools may influence your chances
of winning except your luck, which may play an important role.
But in day trading, with the help of Technical Analysis, Proper
Trading Strategy, discipline, Patience, use of stop Loss
mechanism the odds can be turned in favor to extent of 80-20 or
even higher. Even with 50% trades going wrong and hitting stop
loss, day trader can make profit and turn out to be a winner.
Day Traders must follow successful trading rules and avoid most
common mistakes to remain in profit consistently.
In brief, what services are you
offering for Day traders/Investors?
1. Highly Active Day-traders
can get real-Time Intra-day Trading Calls in comfort of their
home or office though our ”Message Room” (like MSN/Yahoo
Chat-Box). If you are a busy executive or a person on move but
do not want to miss any trading opportunity, you can get live
trading calls on your mobile via SMS and profit from every short
term fluctuation in the Market. (Additionally to assist you
formulate a trading strategy for the day we have Daily Morning
Newsletter specially designed for Day and Swing Traders, a
trading guide like Bullish or Bearish Patterns, Breakouts,
Candlestick Patterns, Overbought/ Oversold stocks, Support/
Resistance Levels for key stocks, Trend change Levels, Bar
Reversals, Highly volatile stocks, A/D data, Stock Likely to
move (both Bullish & Bearish) with Targets/ Stop Loss Levels and
lot more…)
2. Semi-active Day Traders,
or those expert themselves want second opinion or want
additional tips, can go for economical ‘5-SMS a day’ plan with a
Basic Newsletter giving important support resistance levels of
50 most active scrips including leading “F&O” scrips.
3. High Net worth Investors
may avail our Portfolio Advisory Service to track their
portfolio and make best use of Technical Analysis to profit from
Trading in scrips in hand. Such investors may send separate mail
giving their contact numbers.
4. For those, who wish to
have Technical Analysis of a specific Stock, we offer detailed
Technical Analysis Report at a nominal Fee, payable in advance.
What is the difference between 2
services plans named "5-SMS a day" and "Intra-Day Live SMS
Calls"?
”5-SMS a day” is basically a service in which SMS
will be sent at ‘Fixed time’ like first between 9.30-9.45 am
with trading recommendations, if any followed by at 11.00,
12.30, 2.00 and at 3.15pm or before closing hours if extended.
While in “Intra-Day Live SMS Calls” plan you get SMS as soon as
there is a Buy/ Sell Signal from Charts. Number of SMS may vary
depending upon trading opportunities to the extent of 15-20
calls a day. These will be time-sensitive for active traders.
Please clarify as what is the
difference between "Basic Newsletter ” (BNL) and “Detailed Daily
Newsletter” (DNL)?
”Basic Newsletter (BNL)’ as the name suggest gives
basic trading information to the Day Traders like Important
Support/ Resistance Levels/ Trend Change Levels/ 10 Period
High/Low/ Bar Reversals/ AD data. This information is very
useful for Day traders who trade only on Support/ Resistance
Levels. The “Detailed Daily Newsletter (DNL)” Contains all the
reports useful for all Day Traders and Investors using 1/5/30/
60 Minutes & Daily Charts, like Bullish or Bearish Patterns,
Breakouts, Candlestick Patterns, Overbought/ Oversold stocks,
Support/ Resistance Levels for key stocks, Trend Change Levels,
Bar Reversals, Highly volatile stocks, A/D data, Stock Likely to
move (both Bullish & Bearish) with Targets/ Stop Loss Levels and
lot more……………..
What is “Free Newsletter & Tips” on
your web site?
As part of promotion of our services and to help traders and
investors from time to time, who cannot afford our regular
services, we give useful information through of Newsletters and
other articles on Technical Analysis. Most Part of these
newsletters is reserved for Paid Subscribers, however the
Disclaimers/ Privacy Statement shall be applied to subscribers
of Free Newsletters also.
I am willing to subscribe to the
services offered by you but can I have “Free Trial” for few days
to test your skills?
We can realize your apprehensions but you will appreciate that
we are in this field since 1990 and proved our performance in
all the best and worst periods of Stock Market hence do not
require any testing. Moreover there are many cases in which
people keep on asking for Free Trials under different names with
different identities and mobile numbers. Therefore as a matter
of policy, we do not give FREE TRIALS. You may try our “2-Week”
Paid Trial offer.
Can I cancel my Membership/
Subscription any time due to any reason?
Yes! You can cancel your membership/
subscription any time by giving 7 days’ advance notice in
writing, however the running month will be charged full and
refund will be sent to you within 15 days after deducting the
charges on the basis of ‘Monthly Subscription’ multiplied by the
number of months the service was used. For Example if you intend
to cancel Yearly subscription of a Plan (whose Yearly
subscription is 22500/- while the Monthly Subscription is
Rs2500/) after using it for 5 months. So you will get
(Rs.22500/- minus Rs.2500x5 months= Rs.10000 minus full taxes if
applied)
"I want to start day trading, but I
don't know the first thing about it."
If you not sure about day trading, please don't just
"jump in" take the time to read up and learn the basics of
trading. Day trading is NOT easy and not a "get rich quick"
strategy. A great way to start into day trading is to paper
trade or use a trading simulator (without involving actual
funds). These strategies don't take into account all the
possible risks that occur when trading with real funds, but it
can give you a sense of what it's like to trade. Please make
sure you have a strong foundation of knowledge before using
actual funds
What is ‘BTST’ offered by many Brokers
of NSE/ BSE?
Taking advantage of the Settlement Procedures of
Stock Markets, which requires settlement of Trade on 3rd Day of
execution, many Brokers have started offering their Clients /
Day Traders the facility of BTST (short form of ‘Buy today Sell
tomorrow’) at nominal extra cost (or NO Extra Cost by few)
provided the financial interests of brokers are protected. These
trades are to be sold on next day (or before 12.00 noon on 3rd
Day). However ‘Short Selling’ under this facility is not
possible hence not available.
'How much capital is needed to begin
day trading?
Generally, any day trader should have enough trading capital to
enable him or her to buy at least few hundred shares of any
given stock on any particular day - preferably without having to
use margin or using only part margin. In addition, the new day
trader should treat this as 100% risk capital and should not
have to unduly worry that the whole amount of this capital may
be lost very quickly.
How many On-Line Buy/ Sell Advises do
you give in a Day?
On a Normal Trading day with usual fluctuations, you can expect
5 to 10 calls, however on a good volatile market these calls can
go up to 20 also where as on a Non-trading market, these get
reduced to 1 to 3 only.
What is your criteria of selection of
stocks for Day-Trading?
The very first criteria are ‘Volume’. We select only ‘High
Volume Stocks’ only for easy entry and exit (even in Stop Loss
case). Second criteria are ‘Volatility’. It has been seen that
Volatile stocks give better Trading opportunities for Intra-Day.
What is the number of stocks, you
analyse for Day Trading?
We follow about 200 High Volume Stocks of ‘Nifty’, BSE ‘Sensex’,
‘F&O’ stocks including select high volume stocks. Apart from
that we ‘rotate’ 10-15 stocks from time to time, which get into
limelight on some news/ results/ media or on Technical
Breakouts.
How do you give Real-Time Buy/ Sell
advices to Day Traders?
We give real-time trading advise using ‘Message Room’, ‘Pop-Up
Alerts’ and by ‘SMS’ on your Mobile Phones during market hours.
Message Rooms has facility to only receive messages. For Message
Room and Pop-Ups, you need to have internet facility during
market hours to be On-Line.
Which of ‘Message Room’ or ‘Pop-Up
Alerts’ or ‘SMS’ is suitable for me for real-time trading
advise?
Message Room is for those Traders who have Internet
facility, to be on line all the time during trading hours and
they trade through internet/or Broker’s terminal instantly.
‘Pop-Up Alerts’ are useful for those busy investors/ traders/
HNI (with internet facility) who want to trade only when there
is an opportunity. A small ‘Message Window Pop-up’ on their
computer screen notifies them as soon as we send a message. And
SMS is for those active traders who are mobile and can get their
trades executed over phone or otherwise but do not have access
to internet facility all the times.
How do I decide as how many shares to
buy?
You should try to use the same amount of money on
each trade, NOT the same number of shares. You should decide
before you begin the service how much you will trade with. Let's
say you decide on Rs50, 000/- per trade. If you are buying XYZ,
and it costs Rs50, you should buy 1000 shares. If you are buying
ABC and it costs Rs25, you should buy 2000 shares.
Is every stock suitable for day
trading?
No. A day trader should never trade low volume
stocks. These stocks have poor liquidity and hence a higher
price volatility. This may make it hard for you to exit your
position quickly at a fair price. Trade only high volume,
well-known stocks.
What does it mean to "short" a stock?
To "short" a stock, you simply sell the stock without
actually owning it. You will have the obligation to buy back the
stock on the same Trading Day in order to "cover" your short
sale to make you have ‘zero position’. When you short sell a
stock, you are hoping that the stock price will drop so that you
can buy it back at a lower price than what you sold it for,
thereby making an Intra-Day profit on the transaction.
Is it possible to keep Short Position
‘open’ for more than a day?
No, in Cash Segment all the trades are settled on
‘Delivery’ basis on End-of-Day position thus Blank Short
Positions must be covered on same day to avoid covering of
stocks in ‘Auction or Spot’ otherwise, normally at much higher
price than prevailing market prices. However position in stocks
traded under “Futures & Option Segment” (known as ‘F&O Segment’)
can be carried forward to the extent of 3 Months (under
different contracts of 1 Month/ 2 Months/ 3 Months) provided
such shares are traded under ‘F&O segment’ (at present there are
only few stocks under this category. Check with your broker
about F&O dealings/ Margin Requirement/ Brokerage and settlement
procedures. For more details and latest list of such stocks you
may visit www.nseindia.com).
What is the difference between a market
order, a limit order, and a stop loss order?
Here are the key differences between each type of order:
1.A market order instructs your Trading Terminal or shares
broker to buy or sell shares immediately at the current market
price. This will usually take place at the "ask" price
2. A limit order instructs your Trading Terminal or shares
broker to buy or sell shares at certain price specified by you.
When (and if) the price of the stock reaches the price you
previously specified, your order will be executed at that price.
3. A stop loss order instructs Trading Terminal or shares broker
to liquidate your position if the share price drops or rises
above a certain amount specified by you. (Imp. Note - Give
sufficient spread between Stop Loss limit and Trigger Price to
avoid any non-materialization of Stop Loss Order)
Should I Trade without using Stop Loss
Orders
Never! Never trade without Stop Loss however you may be sure of
your success. In one stroke it may wipe off all your capital
(may be more on Margin Trading) if anything goes wrong. Your
‘Stop Loss’ order should be initiated along with your Buy/Sell
order without fail. Even if 50% of your trades are met with Stop
Loss, you can still make profit on winning trades. (Imp. Note -
Give sufficient spread between Stop Loss limit and Trigger Price
to avoid any non-materialization of Stop Loss Order)
I have tried day trading but with high
brokerage charged by my broker, I end up negative despite
successful trades. What should be reasonable Brokerage in ‘Day
Trading’ to catch small price movements profitably.
Normally brokerage is linked with the Trading Volume/ amount of
Margin and the services provided by the Brokers. 5 (Five) Paise
per share of any amount, on each side of Buy or Sell is the kind
of brokerage advertised by few popular On-Line Brokers. Normally
High Volume Traders pay brokerage of 0.015% to 0.04% of traded
shares while Low Volume Traders may have to pay more brokerage.
There is a practice of Fixed Brokerage per month also with some
brokers irrespective of Volume or Number of Trades. Also it may
be kept in mind that brokerages are more competitive in big
cities than smaller cities/towns due to competition and other
infrastructure costs involved.
I am a Businessman running my own
business. Though I am an active Investor and Trader, but at
times I don’t get much time to follow my trades. Is Day-Trading
suitable for me?
A. Basically Day Trading is Suitable for those who are trading
on-line, have direct access to Trading Terminals or brokers to
get their orders executed instantly. Every minute (rather
second) matter in Day Trading. If one cannot track his trades,
must not involve in day trading, which at times require prompt
decisions.
What rules do you think are the most
important for day traders?
There are many important rules that day traders
should adhere to but the most important of these are (You may
also check the web-site for most common mistakes committed by
day traders):
1. Always do your own due diligence (Research) before entering
any Trade
2. Always Trade with the money you can afford to lose
3. Divide your Capital in 10 equal Risk Parts
4. Never Over Trade
5. Always use ‘Stop Loss’
6. Never Average your Losses
7. Sell Short as often as you go Long
8. Don’t Change your Strategy after initiating a Trade
9. When in doubt, simply get out.
10.Buy on Bad News & Sell on Good News
11.Don’t follow the crowd, they are usually wrong
12.Ban wishful thinking in the Market
13.Hope, Wish, Fear, Pray are all 4-letter words, obstacle in
successful trading
14.Many small profits are equal to Big Gains.
Q. Do you give ‘Technical Analysis’ of any stock on Subscriber’s
request during Market Hours?
A. No! Strictly Not! To remain focused on our research and
analysis, We do not appreciate any phone calls or entertain any
query during market hours. Our suggested calls are clear with
Volume/ entry level/ Target/ Stop Loss Level that no body should
have clarification or confusion or misinterpretation of any
kind.
However if such stock is in the list of about 100-125 High
Volume stocks, which we follow on daily basis, such requests can
be considered but after Market Hours or on Weekends.
Any one seeking our Technical Report on any stock may contact us
through ‘Technical Query’ section after paying a nominal Fee.
Do you or your associates Trade in any
of your recommended Stocks?
No! As a matter of policy, we maintain high degree integrity and
to give unbiased advisory, we (employees, associates, partners,
analysts, promoters of Team.trade4profit) do not trade ourselves
in the Stock Market. It has been noticed that many analysts, who
are traders themselves, though wrong technically, try to justify
their recommendations and try to create hype about any stock to
create Exit route for themselves.
Do you get any compensation from any
company you recommend in your Chat-Room Service or in
Newsletter?
No. We have never received, and never will receive, any
compensation of any sort from any company we cover in the
newsletter or our Chat-Room Service. All stocks we cover in our
service are selected because we feel they stand a chance at
making a profit for our Subscribers/ Members and for no other
reason.
What time is the Daily Newsletters sent
to Members?
All members should receive the newsletter(s) before the markets
open. Normally it is sent any time between 11.00 pm to 7.30 am,
however, owing to reasons beyond our control it can be delayed
further a few times a year.
Will your Service be available on all
the trading days throughout the year?
No! You should be prepared for ‘No Service’ for about 10 Trading
Days in a year due to various reasons beyond our control (like
failure of Web-site Server, Failure of Service at Data
Provider’s end, Failure of Internet connectivity, Power
Failures, Technical Faults at our Computers, Viruses, Social
Compulsions etc). We shall keep you informed in case of such
Force Majure situations and try our best for alternative
arrangements if possible.
What are ‘Futures ’?
It is an Agreement between the Buyer and the Seller for the
Purchase or Sell of a Particular Asset (like Equity Stock/ Index
etc) at a Specified Price and on a specified future date (1
Month/ 2 Months/ 3 Months). It conveys an OBLIGATION on both
Buyer and Seller to Fulfill the Terms of the Agreement. Futures
are Settled on Last Thursday of the Specified Month and both
buyer and seller have to pay minimum Initial Margin as per the
requirement of stock exchange and account between buyer and
seller is settled Everyday till the expiry of the Futures
contract.
What are ‘Options’?
An option is a contract, which gives the Buyer of Option
(holder) the right, but not the obligation, to Buy or Sell
specified quantity of the underlying assets, at a Specific
(Strike) Price on or before a Specified Time (expiration date)
i.e. 1 Month/ 2 Months/ 3 Months etc. The underlying may be
physical commodities like wheat/ rice/ cotton/ gold/ oil or
financial instruments like equity stocks/ stock index/ bonds
etc. There are 2 types of Options i.e. Call Options and Put
Options.
Can any one Day-Trade in Futures &
Options?
Yes! Any one can do that and square-up his position at the end
of the day, but as the name suggest these instruments are meant
for Position traders who anticipate a substantial price movement
in stocks coming under ‘F&O Segment’ (limited numbers as on
date). Trading in ‘Futures & Options’ is more suitable for Swing
& Position Traders who can maintain their Long/ Short positions
by paying Margin Money as per requirement of the Stock Exchange.
"I forgot my password, now what?"
A. There is a facility below “Member Login” area on Home page to
get ‘Lost Password’ automatically emailed to you but in case of
any difficulty, all you need to do is email us and tell us who
you are. We'll get back to you shortly with your password. To
avoid this situation, be sure to write your username and
password down and keep in a safe place.
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