Is making 15-18% returns easy in the market with negligible risk?
Assume, one has say 1 crore and he invested it in govt securities fund that gives a fixed return of 7.5%
He can pledge it and get 90 lakhs as a margin to trade.
(2/8)
Assuming he is a zero-risk taker and doesn't want to sell any PE positions as we don't know when a flash crash can happen anytime due to bad news. Say border tensions, war, an important person expired etc
By selling only call side hedges, he can make another 8-10%.
Feb 14, 2023 • 7 tweets • 2 min read
(1/n)
If your profit from F&O trading is less than 1 crore, then don't even think to start a Pvt Ltd company for trading. Just trade in personal account.
All expenses that can be shown in Pvt Ltd can also be shown in personal be it be salaries, travel, hotel, entertainment
(2/n)
Expenses, depreciation of assets etc.
Tax to be paid for 1 crore = 31 lakhs in personal and 26 lakhs in corporate
Auditor fees and process for running pvt ltd costs around 1 to 1.5 lakh. So, paying extra 4 lakhs tax from personal account will ensure that all the money is
Jul 30, 2022 • 11 tweets • 3 min read
(1/n)
I recently opened an account with ICICI Direct.
Here is my experience.
A thread.🧵
Having an account with the full-service broker and trading their recommendations is a recipe for disaster.
They always work towards achieving more business/brokerage for them.
(2/n)
- Most of their recommendations are related to option buying as they require less margin and more clients will be attracted to do it. 5 out of 6 current recommendations on Nifty options are related to option buying and see the margin required for each, they are too low.
Jul 9, 2022 • 15 tweets • 4 min read
(1/n)
Why not to trade in Pvt Ltd Company?🧵
Avoid trading in Pvt Ltd company if the sole purpose of the company is F&O trading & no other income in the company.
- NBFC registration is a must, without that penalty upto 10 lakhs and imprisonment of 1 year.
(2/n)
- Double taxation as profits cannot be withdrawn without paying tax again.
- All expenses that one is detecting in Pvt Ltd company can also be done in the personal account.
Many popular handles are guiding to go for pvt ltd company to reduce tax. But, its completely
Jun 4, 2022 • 12 tweets • 3 min read
(1/n)
Finally, I quit a high paying 15 year job to become a full-time trader.
I always dreamt of not working under anyone but yet to make good income and it happened with trading.
Now I am independent, own boss and have plenty of time to do whatever I wish to do.
(2/n)
But, Don't take any hasty decisions, I was planning for this since last 3-4 years.
My story.
I was always obsessive of stock market since 2005 as I like gambling, poker, rummy etc :)
I joined my first company in 2007 and then I got an opportunity to visit overseas.
Nov 22, 2021 • 5 tweets • 1 min read
(1/5)
Deciding position size based on risk:
1. Risk Fixed percentage of the capital, say 1% per trade. If your capital is 10 lakhs, risk 10k, if it becomes 9 lakhs, risk 9k.
2. Risk fixed amount of capital, say 10k per trade. Even if capital is 10 lakhs or 9 lakhs, risk 10k.
(2/5)
3. Risk more amount from winnings + fixed amount from capital. Say you are in profit of 2 lakh on 10 lakh capital, Risk 1% on capital = 10k + 5% of profits = 10k, total 20k
4. Risk the money you earned in previous trading session or previous week profits.
Jul 11, 2021 • 7 tweets • 2 min read
1/7
Some of the intraday trading rules for better trading:
1. A Trading plan is a must to survive in the markets in long run. Trading plan should consist of when to trade, Where to enter, where to exit, what should be stop-loss if the trade goes wrong,
2/7
what stocks or indices to trade, what should be the risk per trade and accordingly defining position size etc.
2. First 15 minutes is normally volatile and considering the option premiums are very less nowadays, it's better to wait for 15 mins and then take a trade.
Jul 2, 2021 • 5 tweets • 2 min read
1/5 This is the story of my Dad.
He is 65 & retired.
Taught him about option selling in Sep 2020 & he was actively trading only options since Oct 2020
Able to get 66% returns. 1. I taught him about basics of option selling, how profitable it is and basics of straddles & strangles
2. Then, suggested him to read all the chapters of Zerodha varsity, which helped him to understand much better. 3. Suggested him to watch @itjegan traders carnival video and few face2face videos of @Mitesh_Engr@PRSundar64 4. He started slowly with far OTM option selling.
Jan 15, 2021 • 11 tweets • 2 min read
1/11
A Thread about PF/PPF and VPF.
When I started my job, no one told about this and still many people don't know about VPF. I regret not knowing about it for long time in my job.
PF/VPF is the best and will beat all the Debt/Liquid Mutual Funds hands down.
2/11
PF as most of you might be knowing is provident fund. Both employee and employer should contribute 12% of basic salary each every month as per the government rule. Current interest rate of PF is 8.5%.
Nov 22, 2020 • 8 tweets • 2 min read
1/8 How to become profitable traders like institutions? (Answer at the end of the thread)
Why Institutional Traders are more profitable than Retailers?
Because they have a very good risk management and need to follow a strict discipline to survive in the industry.
2/8 If some institutional trader loses say 2% at the start of week itself, he can't trade for rest of the week and need to serve others.
If he loses for 3-4 weeks, he can't trade for next month.
And if he loses for 4-5 months, he will be fired.
Nov 20, 2020 • 7 tweets • 4 min read
1/7
I am not against webinars, but the knowledge you get in reading a complete book is far better than attending a webinar.
As many of you were asking me the books to read, I am listing some of the books that cover option strategies, Greeks, Trading psychology, Risk management.
2/7
I suggest you to read 1 to 5 books first and then choose other books as per your interest.
I am giving amazon links for reference so that you can read the preview and decide, it doesn't mean that you need to purchase. You can always search the web for free pdf :)
Jun 26, 2020 • 5 tweets • 2 min read
1/n @asitbaran@Raghunath_TL@itjegan@PRSundar64 Saw Mr. Asit thread on option greeks saying it's very important.
But I believe, Greeks are required only for beginners to understand how options work. Correct me if I am wrong.
2/n Once you know about how options work, then no need to consider any greeks, everything comes default while taking/adjusting positions. And by seeing underlying option prices, you can know about all the so-called greeks. After all, Price is the KING.
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