I've been trading for the past 3 years.
Here are 10 concepts I wish I learned quicker: 🧵
Collaborated with @niki_poojary
Here are 10 concepts I wish I learned quicker: 🧵
Collaborated with @niki_poojary
1. Conviction
Separates the beginners & the professional traders.
Best traders bet big when odds are in their favor. Think of the number 1 trader we know and how he uses this to his advantage. Study your highest profit trades.
Only to be used when all odds are in our favor.
Separates the beginners & the professional traders.
Best traders bet big when odds are in their favor. Think of the number 1 trader we know and how he uses this to his advantage. Study your highest profit trades.
Only to be used when all odds are in our favor.
2. Execution power
Without executing on your ideas/analysis, you will gain nothing.
Gradually scale up from:
1. Lower premiums to higher premiums.
2. Lower ROIs to higher ROIs.
Increase your execution power gradually with time.
Without executing on your ideas/analysis, you will gain nothing.
Gradually scale up from:
1. Lower premiums to higher premiums.
2. Lower ROIs to higher ROIs.
Increase your execution power gradually with time.
3. Position sizing
If you learn to think in 10 lakh terms, you will be able to manage any kind of capital.
Scaling-up is easily possible if you think about position sizing in this manner.
All that's left is to think in multiples of 10 lakhs then.
If you learn to think in 10 lakh terms, you will be able to manage any kind of capital.
Scaling-up is easily possible if you think about position sizing in this manner.
All that's left is to think in multiples of 10 lakhs then.
4. Money Management
If you're doing well and making money, it makes no sense to risk lesser.
Can you make more money with the same ideas that you have? Yes!
Risk more when Capital is at an ATH.
Risk Less when in a drawdown > 5%
If you're doing well and making money, it makes no sense to risk lesser.
Can you make more money with the same ideas that you have? Yes!
Risk more when Capital is at an ATH.
Risk Less when in a drawdown > 5%
5. Risk Management
You have to decide how much you're willing to lose in a day.
Whatever the amount, divide it by 3 times. Just risk that amount in 3 trades in a day. Stop trading if you lose 3 times.
This prevents us from overtrading and losing more.
You have to decide how much you're willing to lose in a day.
Whatever the amount, divide it by 3 times. Just risk that amount in 3 trades in a day. Stop trading if you lose 3 times.
This prevents us from overtrading and losing more.
6. Psychology
We should not let any of our emotions affect our trades.
Without good psychology, it is impossible to trade well. When you see huge mtm swings, you will have bad psychology.
Work on keeping these swings low.
Don't succumb to fear and greed.
We should not let any of our emotions affect our trades.
Without good psychology, it is impossible to trade well. When you see huge mtm swings, you will have bad psychology.
Work on keeping these swings low.
Don't succumb to fear and greed.
7. Discipline
Greed and fear keep controlling us and this just makes us worse. If we inculcate discipline in trading it's possible to achieve our goals over the longer run.
A lot of loss-making traders don't have discipline at all.
Do the opposite of these loss making traders.
Greed and fear keep controlling us and this just makes us worse. If we inculcate discipline in trading it's possible to achieve our goals over the longer run.
A lot of loss-making traders don't have discipline at all.
Do the opposite of these loss making traders.
8. Edge
Without an edge, we cannot be profitable in the longer run.
Option selling is mainly profitable due to the probability of winning. But this alone is not an edge.
When good risk-reward is applied to high probability setups an edge is formed.
Without an edge, we cannot be profitable in the longer run.
Option selling is mainly profitable due to the probability of winning. But this alone is not an edge.
When good risk-reward is applied to high probability setups an edge is formed.
When you become good at all the points from 1-7, you can safely assume that you have an edge in trading.
9. Lower drawdowns
The lower your drawdowns are the quicker you can reach ATH capital and ultimately make higher profits.
Bigger drawdowns have a big-time period to them when you're recovering your account which is very painful.
This time period reduces if we lose lesser.
The lower your drawdowns are the quicker you can reach ATH capital and ultimately make higher profits.
Bigger drawdowns have a big-time period to them when you're recovering your account which is very painful.
This time period reduces if we lose lesser.
10. Practice
Practice is the only solution to becoming a skilled trader.
There is no holy grail so stop searching for it.
The best is to start practicing any new strategy with 1 lot.
With comfort can start scaling higher.
Practice is the only solution to becoming a skilled trader.
There is no holy grail so stop searching for it.
The best is to start practicing any new strategy with 1 lot.
With comfort can start scaling higher.
If you found this useful, please do RT first tweet.
Follow to never miss them.
See past threads here:
@AdityaTodmal & @niki_poojary
Follow to never miss them.
See past threads here:
@AdityaTodmal & @niki_poojary
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