Rakesh Jhunjhunwala's Stocks Fans Club

Movies Based on Trading

2011-10-27T11:48:00.000-07:00

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Trading Maxims / Quotes

2011-10-27T00:00:00.000-07:00

Jesse Livermore / "How to trade stocks"

--"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical (technical) formations and patterns recur on a constant basis."

--"The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor."

--Don't take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don't be an impatient trader.

--"It is foolhardy to make a second trade, if your first trade shows you a loss. Never average losses. Let this thought be written indelibly upon your mind."

--"Remember this: When you are doing nothing, those speculators who feel they must trade day in and day out, are laying the foundation for your next venture. You will reap benefits from their mistakes."

--"When a margin call reaches you, close your account. Never meet a margin call. You are on the wrong side of a market. Why send good money after bad? Keep that good money for another day."

--"Successful traders always follow the line of least resistance. Follow the trend. The trend is your friend."

--A prudent speculator never argues with the tape. Markets are never wrong--opinions often are.

--Few people succeed in the market because they have no patience. They have a strong desire to get rich quickly.

--"I absolutely believe that price movement patterns are being repeated. They are recurring patterns that appear over and over, with slight variations. This is because markets are driven by humans--and human nature never changes."

--When you make a trade, "you should have a clear target where to sell if the market moves against you. And you must obey your rules! Never sustain a loss of more than 10% of your capital. Losses are twice as expensive to make up. I always established a stop before making a trade."

--"I am fully aware that of the millions of people who speculate in the markets, few people spend full time involved in the art of speculation. Yet, as far as I'm concerned it is a full-time job--perhaps even more than a job. Perhaps it is a vocation, where many are called but few are singled out for success."

--"The big money is made by the sittin' and the waitin'--not the thinking. Wait until all the factors are in your favor before making the trade."

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My Experiences with Trading

--Markets are always right, we are not.

--The day you start praying to get the trade right ,You are in big trouble even GOD cannot help you out.

--Even the greatest trader in India can fail if he doesn't follow his stops.

--Always respect the markets.

--The day you stop following your rules your end is inevitable.

--Price is king. Always trade in a closed room with no disturbance.

--There is no need to follow any news as it is already discounted in the price.

The Greatest Trades of all times

2011-10-26T07:55:00.000-07:00

Trading Indian Markets

2011-10-24T07:25:00.000-07:00

Basic Trading Rules

Trading Rules
===================================
1) Use Stop Loss
2) Never Average a Loosing Trade
3) Trade in the Direction of the Trend
4) Cut your Losses and let your profits run
5) Keep All these rules in front of you while trading.
6) Prefer Swing Trading rather than Intraday Trading.
7) Never become overconfident.
8) There is no place for emotions in trading
9) Read these rules before you make any trade.Read Everyday.

Hello Trading Aspirants,

Trading Vs Investment

There is a very very thick line that separates Trading and Investments.I will say rather they are the total opposite concepts.and what is applicable for one is irrelevant for others.

The above written rules are very very common and every trading expert will say there rules. But following them seriously is really very very difficult. When we start trading with these rules in the beginning we follow them very seriously . but as and when time passes and one makes some money by making some adjustments in the rules . At this time the ego comes into picture and the person starts to loose the game.

Common misconception about 52-week high and 52-week low.

One thing which people think which is very obvious is that when a stock reaches a 52 week high its time to sell or its time to short and buy if its touching the 52-week low to buy. Actually its really the opposite. i have analyzed these for lots of instances.

What to buy?
The stocks which have follen the least in the bear market are the right candidates to buy along with trend identifiation is aslo very important.

What to short?
The stocks which have fallen the most from the highs and if these guys have bounced back a little then you can go short in a bear market.

But whatever you do, must be done with the stops and done in the direction of the trend.

Dennis Gartman's Simple Rules Of Trading

1. Never, Ever, Ever, Under Any Circumstance, Add to a Losing Position... not ever, not never! Adding to losing positions is trading's carcinogen; it is trading's driving while intoxicated. It will lead to ruin. Count on it!

2. Trade Like a Wizened Mercenary Soldier: We must fight on the winning side, not on the side we may believe to be correct economically.

3. Mental Capital Trumps Real Capital: Capital comes in two types, mental and real, and the former is far more valuable than the latter. Holding losing positions costs measurable real capital, but it costs immeasurable mental capital.

4. This Is Not a Business of Buying Low and Selling High; it is, however, a business of buying high and selling higher. Strength tends to beget strength, and weakness, weakness.

5. In Bull Markets One Can Only Be Long or Neutral, and in Bear Markets, One Can Only Be Short or Neutral—This may seem self-evident; few understand it, however, and fewer still embrace it.

6. "Markets Can Remain Illogical Far Longer Than You or I Can Remain Solvent." -These are Keynes' words, and illogic does often reign, despite what the academics would have us believe.

7. Buy Markets That Show the Greatest Strength; Sell Markets That Show the Greatest Weakness: Metaphorically, when bearish, we need to throw rocks into the wettest paper sacks, for they break most easily. When bullish, we need to sail the strongest winds, for they carry the farthest.

8. Think Like a Fundamentalist; Trade Like a Simple Technician: The fundamentals may drive a market and we need to understand them, but if the chart is not bullish, why be bullish? Be bullish when the technicals and fundamentals, as you understand them, run in tandem.

9. Trading Runs in Cycles, Some Good, Most Bad: Trade large and aggressively when trading well; trade small and ever smaller when trading poorly. In "good times," even errors turn to profits; in "bad times," the most well-researched trade will go awry. This is the nature of trading; accept it and move on.

10. Keep Your Technical Systems Simple: Complicated systems breed confusion; simplicity breeds elegance. The great traders we've known have the simplest methods of trading. There is a correlation here!

11. In Trading/Investing, an Understanding of Mass Psychology Is Often More Important Than an Understanding of Economics: Simply put, "When they are cryin', you should be buyin'! And when they are yellin', you should be sellin'!"

12. Bear Market Corrections Are More Violent and Far Swifter Than Bull Market Corrections: Why they are is still a mystery to us, but they are; we accept it as fact and we move on.

13. There Is Never Just One Cockroach: The lesson of bad news on most stocks is that more shall follow... usually hard upon and always with detrimental effect upon price, until such time as panic prevails and the weakest hands finally exit their positions.

14. Be Patient with Winning Trades; Be Enormously Impatient with Losing Trades: The older we get, the more small losses we take each year... and our profits grow accordingly.

15. Do More of That Which Is Working and Less of That Which Is Not: This works in life as well as trading. Do the things that have been proven of merit. Add to winning trades; cut back or eliminate losing ones. If there is a "secret" to trading (and of life), this is it.

16. All Rules Are Meant to Be Broken.... but Only Very, Very infrequently. Genius comes in knowing how truly infrequently one can do so and still prosper.

Great stuff, Dennis... Simple, yet profound.

A must read before any trade.

Top Stocks For Next Bull Run

2011-09-11T10:08:00.001-07:00

Hello Guys,

Looking in current market scenario these are the best times to accumulate the Large cap stocks.
These are some of the stocks which will be the leaders in the next bull run.....

1) Sun Pharma : 483.55
2) M&M : 789.35
3) Siemens :850
4)Heromoto:2219
5)TCS: 1013
6)Bharti Airtel:400
7)HDFC:660
8)Ambuja Cement:138
9)ACC:1013
10) COAL INDIA:381
11) Mundra Port:153 (DARK HORSE)
12) Indusland Bank:266.80

Prices as of 11 Sept 2011

The next bull market leader will be COAL INDIA......

I feel in next 6 months out of the 12 stocks suggested at least 10 stocks will give you fantastic returs . we will review the performance every month...

Regards,
Chintan DESAI

Short Term Stock Picks

2011-09-10T12:41:00.000-07:00

Hello Folks,

Its midnight 1.11 am 11 Sept 2011 , This is a technical analysis of TTK Prestige......

Let me talk about this stock ....Fundamentally very sound ... From levels of 200 to 3000 hardly in any time just 1.5 - 2 years.. But now what can it decline from here .. What do u think .. Shall i buy now ?.. These questions come to mind...Lets look at the chart

See the first uptrend which is a continues one ... now look at the down tread which has started..
Its just the higher tops and higher bottoms and now whats happening low top and lower bottom

Call For 13 Sept 2011
Go Short at 3000 Levels SL 3050 on Closing basis.. Target 2800 and lower...

Lets see if the call goes right....

Regards....

=================================================

Call For 14 Sept 2011
Go Long on Bharti Airtel at 386 SL 380 Target 398

Regards..

Rakesh Jhunjhunwala's Stocks Fans Club: Multibagger Stocks For Future

2011-09-10T07:09:00.000-07:00

Rakesh Jhunjhunwala's Stocks Fans Club: Multibagger Stocks For Future: Hey Guys, This is my first blog from Rakesh Jhunjhunwalas Fans Club.On this blog we will be mainly discussing the stocks which are potentia...

Multibagger Stocks For Future

2011-09-10T05:49:00.000-07:00

Hey Guys,

This is my first blog from Rakesh Jhunjhunwalas Fans Club.On this blog we will be mainly discussing the stocks which are potential multibaggers of tomorrow .

Let me start my blog by telling you what is value investing..

Value investing is an investment paradigm that derives from the ideas on investment and speculation that Ben Graham and David Dodd began teaching at Columbia Business School in 1928 and subsequently developed in their 1934 text Security Analysis. Although value investing has taken many forms since its inception, it generally involves buying securities whose shares appear underpriced by some form(s) of fundamental analysis.^[1] As examples, such securities may be stock in public companies that trade at discounts to book value or tangible book value, have high dividend yields, have low price-to-earning multiples or have low price-to-book ratios.

High-profile proponents of value investing, including Berkshire Hathaway chairman Warren Buffett, have argued that the essence of value investing is buying stocks at less than their intrinsic value.^[2] The discount of the market price to the intrinsic value is what Benjamin Graham called the "margin of safety". The intrinsic value is the discounted value of all future distributions.

However, the future distributions and the appropriate discount rate can only be assumptions. For the last 25 years, Warren Buffett has taken the value investing concept even further with a focus on "finding an outstanding company at a sensible price" rather than generic companies at a bargain price.

Multibagger Stocks for 2011/2012:

Multibagger stocks always keep on multiplying your returns over a period of time. Only one must have the patience in them. As Indians we believe in our long term growth story , so here is an effort o find out the potential multibaggers of tomorrow.

Small Cap Multibagger Stocks:

Name	Price
V-Guard Ind	212.5
Eros Intern	235.5
Timken	213.85
Agro Tech Foods	413.8
Tata Coffee	885.65
Camlin	73.25
Atul	222.9
Kajaria Ceramic	107.2
Wendt	1633
Amtek India	119.85
Kewal Kiran	839.5
VST	1305

Prices as of 9 Sept 2011

We will review the performance of these stocks after every 3 months

In the upcoming post I will talk about the large caps/midcaps which can be bought during the current fall of the market

Regards,

A Great Fan of RJ

Chintan DESAI.