Few random useful trading tips

Few random useful trading tips

• Pledge liquid funds as collateral with certain haircut  and use it for option selling and get interest for same and avoid more cash with broker. 

• Always hedge your overnight  positions for reducing risk to a defined loss as well as get the margin advantage.

• Have backup brokers one or two so that you could take counter positions and mitigate  infrastructure outage risk. Also distribute your capital across multiple accounts . Investments in multiple laptops, collocated cloud and multiple Internet connection could save your capital during outages. 

• Always buy hedge positions before taking sell position in order to get margin benefits during execution of trades. 

• Sell covered calls for your liquid, quality investment in stocks and get regular rental income and use selling of cash secured puts to buy stocks on delivery at cheap price while increasing profits same time. 

• Trading is full time business if you want make money consistently  from it and doing it part time won't work. Better to do investing than trading if you are part time. Most of the trading  you believe could be done part time may take away most or all l of your earlier gains  when you miss to be there to adjust or get out on a day when things go wrong like your stop loss failed to work or circuit hit or surgical  strike or corona or nse exchange itself down.Hedging your positions help to certain extend but why do a business where making money consistent  is very very tough when investing is more safer . 

• Do every single  trade with fixed rules and risk reward and position size defined  and set target as small %return of investment on monthly basis with capital protection as key during initial stages before the  heavy lifting.Too much complicated strategies often may not work as they may be curve fitting or just duplicating filters. 

• Forget your expertise, conquer your FOMO and simply sit outside with no trading on major event days  Not trading itself is a trade. Also trade only if u get a full signal on your rules on other days. 

• Trading is an extension of you and the  reason why you are attracted to it  is the freedom you seek for, but without  discipline in your daily  life there can't be one in trading and it takes no time to loose many times more than what you won earlier . Therefore start investing small parallel is the  way to go in long term. 

• Physically being fit, meditation, visualisation are only ways to calm you and help you make good  decisions consistently. 

• What matters is if your profits are bigger than your  smaller losses. So learn how to let profits run and accept happy small losses.do know about expectancy, drawdown etc beforehand .

• Having multiple strategies that fits into different  market cycles  is important since all strategies won't work in all cycles. For for example have neutral positions that gives you money even when markets are sideways, while your momentum directional trades feeds you when market are trending. 

• Backtesting your trading rules either manually or programmatically helps improve your trading confidence in a volatile market and remain disciplined when faced with  drawdowns or other doubts . Automation /algo trading helps better  execution of trades and reduce mindset issues to certain extend but with the risk of bugs  and so it still need monitoring. Also same time forward test and review /journal your trades regularly. 

• You cannot ever duplicate another person's trading same way as the execution, risk management and mindset differs. So trade the way  what fits your personality like whether to  buy option or sell option or cash or options or breakout or support resistance etc etc.. Remember that if trading was only technical most of traders would have been multmblliinares by now which is very far from reality as trading is combination of technicals, psychology and risk management. So never try copy  rules  and expect it to work for you, nor keep switching or hunting for that holy grail strategy from somewhere. 
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