A Successful Trader Studies Human Nature and Does the Opposite of What the General Public Does” – William Delbert Gann
From the days of Jesse Livermore (an American legendary trader, 1877-1940), market participants have tried to confront the question, "How to be a successful stock trader”? Certainly, it is not just about stock tradintips and tricks, but something more, in fact, a lot of good old virtues like patience, discipline, persistence, etc.
What are the basic things that we need to enroot to be a good trader? These are Mind, Money, and Method, in sync if we want to succeed. If you have the best strategy but don’t have the mental discipline then, nothing will work out.
We first need to have MethodA method can be Technical analysis, fundamental analysis, or your gut feeling. The key is you must have a workable plan to attain success Your method should be measurable, objective, and easy to verify. It should be so simple that if you teach them to ten other people they can easily understand. Our Brain likes clarity, not confusion and chaos
Here are the 7 rules of highly successful traders:
Be optimistic and realistic
Persistence can be your friend
Target on how well you execute your trades
Costs matter a lot when you are a trader
Manage your risk every second of the day
Learn from the market rather than trying to outwit the market
Be an ardent reader, researcher, and a learner
Now, let's find the recipe for successful trading from some of the new generation millionaires.
Delhi based - Alok Jain, a multi-bagger, IIT graduate, who makes money from just 15 minutes of trade, has raked up to 86 percent return on his portfolio says his biggest learning is that exiting is the most difficult thing in the market for both, profit or loss. The strategy is only 20% of the game, 80% is staying the course. If you are confident of your strategy and are disciplined, then any day you can beat the market.
Ashu Sehrawat - one of the youngest millionaires of India, connected through chat room with traders like Derrick, Eric, and Phil. He got curious about their short selling and sent questions via private message from time to time. He concluded that these successful short sell traders were short-selling the stocks that had no business going up in price.
Suresh Gunda, a CA dropout to a successful trader in Hyderabad, says the amount of Patience, Risk & Stress management, years of effort, and hard work has made him a profitable Trader and established his Company. He says that Trading in the stock market, is a battle within you and success comes from love and passion for the market”
However, when asked to comment on why 90% of people lose in trading? He says, Don’t be greedy, and it is the technical knowledge that decides your profit or loss, and make sure you always have a stop loss in place and your emotional stop loss won’t work here.&rdquo
He started at the age of 19, and at the age of 25 years, emerged as the youngest CEO with dedication, knowledge & persistence.
India’s most successful investor Rakesh Jhunjhunwala says that one of his biggest successes was a pure luck investment. How can one think of a more reasonable rational style of investing?
One of the best ways to find out if an investor is just lucky or genuinely successful is how they have performed in different environments. If they can succeed not just during the big bull market but can do well during the bear market in the same way, then they can be considered good investors.
Most Successful Stock Traders in India
There are many big names like Rakesh Jhunjhunwala, Vijay Kedia, etc. who we misjudge as traders, but they are investors. Here are some of the most successful stock traders, their stories, strategies, and learning pieces of advice.
single mother, an Art student who doesn’t have any financial knowledge and financial background, started her trading journey with a capital of Rs. 5 lakh and by the end of 8 months, the capital came down to Rs. 1.75 lakh. At that time her cousin gave her leads and she placed orders as per his suggestions
Mental strength and strong discipline make her the most successful stock trader over strategy.
What we learn from her story is that we should never depend blindly on someone else. Secondly, gain some financial and trading knowledge before you start trading in the stock market.
Chennai based-Kirubakaran Rajendran, a Trading Bot developer (automated trading system based on a set of instructions) has achieved success after years of hard work and learning from every possible mistake one can do and probably more.
He started his career in Infosys with a monthly salary of Rs 1500. He had built a position of Rs. 1.5 lakh, a day before Infosys' results. The next day, results were announced and the value of his strangles had come down to Rs 20,000
This is the turning point of his life when he decided to move from news-based trade to rule-based trade. The other mistake he made in trading was, he borrowed money for trading. A changing shift came to his career when he started reading about the stock market.
His advice for an aspiring trader is to have a clear set of simple rules, and do not trade if you cannot explain your rules or strategy in two lines. You should not go for strategies that give higher returns without looking at the drawdowns. Choose the ones where risk is lower.
For example, if a strategy gives a return of 40 % annually with a drawdown of 15 %, it is certainly better than a strategy giving 90 % returns annually and having drawdowns of 40-45 %
Abhinand, 29, hails from Mysore and is a hermit in the trading worldHe suffered huge losses in the Satyam scam. After this, he turned stock to options for trading and later started about technical analysis and understand how trading works and financial knowledge. Presently, he trades in the Nifty options especially on the bull side, and uses many technical strategies like trend line oMACD, etc.
Self-confidence, persistence, and family support all played an important part in his success
First, learn at least the fundamentals of the stock market then create your strategy. Secondly, never take any loan for trading plus always share your techniques with someone who knows you better.
Obsessed with charts, Naresh believes in the old school of trading where he prefers putting in manual efforts. During 2008, he also lost Rs.40000 like others and after failing once he didn't stop, rather initiated gathering more information about technical analysis from Google and YouTube. Later, he gained good knowledge in price chart strategy, and to date he uses the same strategy for trading
Never depends on others and create your strategy. Keep your trading as simple as possible. Do not complicate the charts with too many indicators. Test the indicators yourself
A Full-time trader, Madan Kumar has rags to riches tale to tell. He credits all his success to his mother and wife for their support to make him what he is today. He gives credit to his mother, for motivating him to complete his education despite being very poor. And to his wife, for her financial support, after he returned to India from the US.
To have reading habits, as it is better to be prepared before you start your luck in trading.
You believe it or not, trading is a game not just on the stock market but within individuals’ mind. You win or lose with the way your mind reacts to the price movement. So if you want to turn trends in your favors, you must affirm your brain the right way with the right hymns. And also if you want earn higher returns from stock market then you must have to enroll yourself in the share market classes in Indore
Individuals with very limited knowledge and experience in trading are either afraid of losing a large amount of their portfolio value or are beguiled by hot tips that promise large rewards but seldom pay off. The pendulum of investment sentiment is said to swing between fear and greed.
Professional traders normally prefer to ride the momentum in the market and don’t bother about valuationsThey focus working on which way the market wind is blowing, which is what drives them. A bit of key learning advice here is to have discipline and knowledge before trying your hands on stock trading and investment.
Start with a demonstration class.
