10 reasons to Invest some bit in Crypto

 

10  reasons to Invest some bit in Crypto

1. It is always wise to diversify your asset class while investing. 
2. The underlying blockchain technology behind the cryptocurrency is for real with multitude of other applications.
3. Crypto will survive from the ‘alternate’ currency benefits over Fiat currency even if may never replace it.
4. Regulations could come in but it is too big to be ignored or banned now that it has become popular with very large crypto ownership and market cap including in India.
5. Any new asset class if disruptive would naturally be volatile in the 'early adoption' phase 
6. It is foolish to invest in doge coins/tokens and other fancy assets that have no narrative worth talking and not in the top 5 list.
7. It is unsafe to put your money to facilitate crypto transactions into any non reputed exchanges. 
8. It is not smart to not find profit maximisations from fixed deposit benefits using DEFI lending applications. 
9. Unless you are convinced very very well in the future potential of crypto, It may be even more foolish to invest more than 1 or 2% of your capital into it.
10. Large business houses,Big global investors,Institutions have already turned out in favour of crypto.

Top down approach to Stock Selection

• The very first step before you pick stock from market is obviously to look at the market indices. As the index is supposed to be a cross section of the market as a whole

• The key parameters you need focus during your technical market analysis are 1) price action and candlestick patterns , 2) trend ,3) momentum,4) Volume, 5) volatility and the 6) support and crucial support and resistance levels.

• There are numerous indicators available for each of these parameters mentioned above that need our attention where you need  to experiment and figure out on your own which of them suits your trading style. Indicators are lagging and therefore price comes first and foremost but same time indicators as long as you are not overdoing it and not distracting you it gives you what it is supposed to and alternatively ignoring some of these parameters could fail to frame a proper market view.

• Another key thing to make note is to analyse the chart for multiple timeframes that helps frame a view for short term/medium term  and long term.Taking a view only on single timeframe could fail to give you the true picture. The general rule is that as long as higher  timeframes are bullish or bearish the lower timeframes would follow same.

• Analysing each of the different industry sectors similarly on the charts would be step two as markets are cyclical in nature and money keeps moving across various sectors  during to various fundamental reasons and it is not necessary that all sectors perform all the time. Identifying the  strongest two or three sectors is the next step.

• Once you know which few sectors are performing the next task is to analyse and find out the strongest stock in the sector.

• As long as you are sticking to only futures segment listed stocks that is more likely to have better liquidity , there are hardy less than 250 stocks in all to look at , and if you are trying to

• Figure out which is strong in the two or three sectors performing there could be only fewer number stocks for you to  analyse on.

• Make note that you analyse all the chart  all step using the same 6 parameters we initially talked about.

• Chart reading is pure practice  and it cannot be mastered merely by reading about them  or analysis them for few days and understanding them.The more charts you see each day the more your eyed are trained to notice all the patterns easily and eventually you could reach a leave where chart would start shouting  to you loud when the entire steps mentioned can be completed in matters of an hour or so maximum.

• Also limit your stocks to just 5 stocks to help focus better using above steps every day before the trading and your homework is  mostly done.

• The last thing would be to frame your trade plan for each of the final stocks  where you reconfirm the entry /exit price, targets, stop loss, position size ,risk reward etc and you are ready with them added to your watchlist ready to execute.

Importance of Trade Journalling. Sharpening the Saw

 

Trade Journalling

• Underestimating this step often lead to failing in stock market in general journal help understand if you did a mistake e.g. broke a rule ,why you did that ? What should have been done? etc.

• Journal help you correct mistakes and take better trades next time.

• Journal help you also know what you did well on a trade.

• Without journal you would never bother to know it and blame everything else.

• To journal is to go back to your own trader mind (black box) and get to know     yourself better as a trader.

• You just cannot improve your trades unless you know what went well or what went wrong 

• Journal record lot many more  parameter not in broker provided p&l.

• Trade performance analysis eg. expectancy, drawdowns, sharpe etc also    could be derived from journal.

• Not having journal mean no trade outcome analysis is like being batsman in a last overs of a match without knowing the score needed to win.

• Journal a bad trade is harder than recording a good trade as you like to forget your bad experience.

• Journal is one of the way a trader sharpens his ‘saw’

Options Trading Facts 1

 

• If you like do intraday options trading probably you like to be more into the action part of trading and does not like sit idle much and eager to participate and see results quicker 

• While the fact is that you are less likely to be  more profitable than a positional/ swing trading unless you have higher capital or take higher risk or both.

• Being more active or less both are fine as long as it fits into your mindset  but what really matters is to maintain same consistently always. 

• Just like the option buying being profitable Is harder than option selling It is no doubt that decision making on either way on smaller timeframes is more harder than other way.

• Backtesting your rules gives you much more confidence than otherwise in order to stick to your rules in your real trade. But Truly how many retailers in options selling has backtested solid rules for every different market cycles and stick to it ?

• Do make sure plan to put that money into short/medium/long investing in good quality stocks on mutual funds or other liquid funds as per your risk appetite, time horizon and expertise so as to benefit from the  additional collateral benefit  for option selling capital from it by pledging them.

• Intraday option trading also gives risk like freak trades scenarios since hedging used only margin with far tom and stop loss may misfire

• Intraday volatility brings in high volatility without having enough lesser reflex action timeframe ignorer to judge and decide the bet adjustment options even with experience.

• No matter you look at open interest or volatility or chart levels or greeks  ,end of the day options trading is speculative and all the traders  skills narrows down to how much of your probabilities of your anticipated price range went right or wrong.

• If you have finally managed to learned the tricks of the game hard way over the years and also made small but decent money in options trading, in order for wealth generation.