RULES FOR STOCK TRADING

 

First rule of trading..

ALWAYS book partial profits in a bull market..used staged profit strategy

Else the guilt of NOTIONAL LOSS supersedes the rejoice of gains.

Second rule-
Never cry on spilled milk.
SINGULARLY Focus on the profits not the current price

3rd law-
Be greedy when others are fearful and fearful when others are greedy.

Rule no. 4-
Learn to be fearful esp in a bull market

Rule no. 5-
Book profits in proportion to price appreciation(provided quantity is handsome)
Viz. 25% profits on 25% gains..

6th Rule-
Calculate the profits in term of time horizon..
Viz. Few companies(or businesses) would give 25% profit in a month or say even in a weeks time..that’s a 1000% annual return on investment when extrapolated..!!!

7th postulate-
Believe a statistician(or your broker) if u cant do statistics yourself..

8th Aphorism-
Enter at lower levels again when opportunity permits.And there is ALWAYS such an opportunity round the corner.

Theorem 9
Never trade in Portfolio stocks and never invest in trading stocks. It shall take years to differentiate between the two.

Rule no 10-
Withdraw 10% of profits as your take home pay check(income) and reinvest 90% elsewhere in other stock or avenue..

Finally,
Never forget to pat your back for a great trade or the friend who suggested it to u..

Happy Trading..
(Crux of my experience in stocks..)

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