Thread by @Raminations

Someone asked my about Options trading, risks, losses and assurances:
Remember Clearly: In markets, there are NO GUARANTEES. Period..
There are probabilities and expectations.
Often Expectations are belied and this can lead to disappointment

When we all trade in Options, let's first recognize the risks.
Your putting money or handing over money is assumed to be with full appreciation of the risk involved.
Analyse the risk involved.Work out, based on available public records, what can happen..

..in case market reacts opposite your existing positions.
Whether your existing capital can hold as defence against possible losses?
Don't blame brokers or your Account Managers(If you have entrusted your trading to someone)
Blame yourself for inadequacy of capital

Don't ask the classic question:
What Capital is needed for Trading?
Answer always is, that depends on what exposure do you undertake while trading.
Many theories are great. Many experts do have excellent strategies. Many traders are brilliant.

But majority don't succeed as they fail in managing the risks of exposing their capital to too much of a risk.
Evaluating the risk is your job if the entity which manages the funds are not regulated by regulators like SEBI.
AIF3 which can deal in similar trading activity..

.. stipulates that you can't leverage more than 2 times.
Remember that the illusion of extraordinary returns that traders promise or assure or guarantee based on past performance is purely a Leverage based one.
Really, if you take their NON LEVERAGED Capital into..

..a/c that won't look anything extraordinary. The more the leverage the more the glamour.

Leverage to Trading is like the make up to the actors.

You won't like to see their faces without that make up, will you?

Same case with Traders claiming extraordinary returns

If I had leveraged 2x then I may be returning around 20% after all expenses.
If I had leveraged 10x then I may be doing a 100% returns.
But remember, the more you are leveraged the greater the chance of blowing your a/cs.
Don't fall for tall claims by anyone.. ANYONE

Always keep in mind that the business of trading CANNOT give better returns than an average business. The trick is in leveraging.

My advice(if one can take it!) is to tell everyone Know Your Risks BEFORE placing money into Leveraged Trades.

Your regrets won't bring money back

Blaming your A/c Manager cannot fill your bank balances.
After all, he is doing a Professional's job of executing his skills based on his knowledge, expertise and skills.
The more he makes, the greater the share of profits he gets.
But remember the risk is yours, and yours only

When market responds to your A/c Manager's assumed set of variables, it may suddenly demand more money and if you can't supply that he may be forced to exit the positions when situation is NOT in your favour.
Yes, you may call for Arbitration etc. But the issue is dicey

So far I haven't come across blaming the A/c Manager's promises and performance evaluation as a case in NSE arbitration proceedings. But that can be quite a messy one if it comes to reality.
NSE and SEBI, infact doesnot encourage even those kinds of deals

Recent regulatory directions require ALL trades be AUTHORIZED by the account holder, in case their accounts are dealt with by third parties. Broker Members are required to show proof of such oreders and confirmation thereof to NSE inspection team

Sit back and think for a while before placing money in anyone's care!
Can there be easy money in this world?
Well, in my 30 years in market, I can tell you all, there is NO easy money available for someone to pick it up. Every paisa comes attached with its own strings

Make sure you understand the risks before plunging into this market..be it on your own or through engaging someone to manage your accounts.
Be clear on where you stand and where the opposite party stands.
DON'T regret after the deal is done. Your money is precious!
Best Wishes