Category: Market Psychology
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Why Should You Paper Trade Options
Will you skydive without knowing how to operate your parachute?” Investing and Flying are similar, in some ways. Many new traders doubt if Paper Trading is still relevant?
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US Presidential Elections- How Will Stocks React?
Do presidential elections affect US stock market? How will stocks react to Mr Trump’s or Mrs Clinton’s win? Based on historical data, it may not be smooth sailing for the stock market this year. Since 1900, On average, The S&P 500 has dropped an about 1.2 percent in 4th year of second presidential terms.
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A Trader’s Second Most Important Virtue
In the first part, we reviewed VIRTUE OF PREPARATION i.e. that the very first quality to succeed in financial markets is PREPARATION which includes everything e.g. know-how, practice, patience and continuous improvement process for increasing your odds of success. Once your are well prepared, the next quality that will shape a trader’s success is PERSEVERANCE. So lets…
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3 Things You Need To Know To Be A Successful Trader
So you think you can trade? Many traders, especially the beginners tend to think that trading is easy. Attracted by glitzy returns promised by various marketing campaigns, new traders tend to think that investing or trading is going to be an easy money making machine. And I am often asked why is it so? One of…
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Structure, Not Strategy, Gives You Freedom
Time and again, I am asked about the ultimate profitable option trading strategy i.e. which is the best strategy to trade markets? Which is the best strategy to trade options? and so on …as if there exists a HOLYGRAIL for trading and winning in the markets. My answer, has always been – “IT IS STRUCTURE, NOT STRATEGY,…
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Why Isn’t Warren Buffett Saying This Now?
Ever since I met with Mr Warren Buffett in 2004, my respect for him has been growing by leaps and bound, year after year. Even though I have read many major books written about him, there is nothing quite like meeting in person. I consider him my mentor, someone, who has always inspired me from…
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Don’t make these costly mistakes in the current market
Russell 2000 (RUT) just crossed 1,000, the highest point ever for RUT; even surpassing the dot com bubble, the credit bubble and so on. S&P is cruising every day higher. Dow is making all time high almost every day. Nikkei is up almost +80% since Abenomics started spreading its wings in Nov’12. Advisors’ bullish sentiments are…
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Crisis Creates Opportunity, Are You Ready
We are now in one of the most optimistic and bullish periods of stock market during the past 2 decades. If you talk to beginners, you will probably come to conclude as if nothing can wrong. Cheap money, central bank’s put option that supports continuous rally etc to name a few factors that wouldn’t let this market drop. However, if you have…
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Making Decisions In The Face of Uncertainty
A close friend of mine likes to manage his investments personally. He is a beginner in investing and sets his investment horizon on the medium to long term. One fine day he gave me a ring to ask for my advice. He says he is a trend follower and uses simple rules to keep his…
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Who Moved My Punchbowl
After two back to back 90% updays (a rare occurrence), Russell 2000 at all-time high, S&P up over 60 points in 2 days, it was time for a pause; a pause that may be attributed to latest FOMC minutes. Various members stressed the importance of a continuing assessment of labor market developments and reviews of…