Best Way To Invest Money In Stocks Market In India?

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I am trading in stock market from 11 years and I have tried all the options like investments, intraday trading, positional trading, equity cash trading, f&o, mcx, currencies, algo trading etc. I have tried even more than 20 advisory companies and PMS providers.

How to make Profit in Trading ?

Which is better positional trading OR intraday trading ?

If you want to gain good profit, go for positional trading rather than pure intraday trading. The reason behind is that intraday trading is completely risky and market is most of the time volatile. So one day you will get some profit and another day you will loose.

I was not much happy with intraday trading from last many years. Major reason behind that was LOSS. Frequent loss in intraday frustrate us and we feel that we can’t get profit from market.

Intraday is like taking risk always. Sometimes we get profit and sometimes we get loss. I was very keen to do intraday trades but luck was very hard and loosing most of the times.

When I was keep on loosing in intraday trading, I tried to improve my trading pattern and make necessary changes. After that success ratio improved to 60% to 65% but still I was unsatisfied because I was not able to generate bigger profits.

Based on my large experience, I am sharing 18 Golden rules of stock market trading:

Intraday trading is completely risky so if any person is coming with only profit expectations or with sentiments, he/she should not trade because market will never understand your emotions.
Intraday trading is a technique which can be learnt and improved day by day so you have to keep on learning everyday. Learning Source: Zerodha Varsity
Stock selection is most important part in intraday trading so you have to choose stock very wisely.
Intraday trading involves high risk which can give complete or partial capital loss so there should be risk calculation like 2 to 4% of risk of entire capital in a single trade. Because if your trade goes in to loss, you don’t loose more than that.
Never ever trade in stock market with anybody’s money. Yes this is most important while trading because I have seen many people who takes personal loan or borrow money from someone and regret after loosing that money. You should trade with your own spare money only.
I have seen many people who make loss just because they don’t have sufficient capital to survive in market like many people trade 5 lots for Intraday in 1 lac capital. I don’t recommend this because sometimes you may get profit but it’s purely a gambling to trade like this. Always put sufficient capital to trade as per NSE margin guidelines and also maintain MTM so that you don’t have to book losses.
New comers don’t follow stoploss and they just keep on holding a loosing stock and it ruin your whole capital. Don’t do that. Always cut the loosing position before it wipes out everything.
Many times I have seen that people book 2 rs profit and hold in 20 rs loss. You should always hold profitable stocks with trailing stoploss to maximize your gains and minimize your losses whenever you are in loss. In this way you can gain good profit from market.
Many people buy or sell anything because a friend, an adviser or anyone suggested. It may give sometimes profit but it’s riskier too because you can’t earn consistently by just following TV advisers or any friend. So always do your own research before trading or investing. Because Learning by yourself is a key to earning.
We have seen many times that if everyone is saying that this stock will reach 200–250 level, it doesn’t happen and that stock gives opposite movement. You should follow warren Buffet’s golden lines that Be fearful when others are greedy and be greedy when others are fearful.
Many people trades too much in a day and they hold too many stocks at a time which is a indication of a disaster. Some are too curious to trade that they put trade at 9:15 AM only and that trade gives losses too many times. One should always wait for perfect opportunity to earn in market because less trading saves profit while frequent trading takes away saved profits.
Always try to learn basics of stock movement so that atleast you can get idea about stock’s support and resistances. Always Buy on support and sell on resistances with stoploss.
Many people buy a stock for an example at 190 and than average at 188 and may be again at 185 and than they have to cut all positions at 180 because of insufficient margin. Don’t average in market because adding loosing positions is always riskier. Better just give up and find other opportunity.
Always follow risk percentage of your capital. Suppose if you have 1 lac capital, don’t take more than 10% of risk in single stock because if you loose 10%, it can be covered but if you loose more, than it create a problem. So always follow risk management formula to minimize your risks.
Many people follow any particular stock or index like it’s their favourite and their friend. Don’t love any stock or index. Just follow basics and trade. Sometimes loving a stock gives us big losses.
Stop trading whenever you are loosing frequently because it happens sometimes that your all decisions and thoughts are against of market which are giving you losses. So whenever this kind of situations are happening, just stop trading and take a break.
Many people think that this is their primary sources of income and they leave their work or job. I just advise them that never leave your primary source of income because stock market earnings are external source of income and keep it as extra income only. Never make it as a main source because it may harm you and your family.
Don’t be emotional and sentimental in stock market because market doesn’t understand anyone’s emotions or problems. Don’t expect that market gives you money for any operation, any loan payment or any other sympathy earning. Just be practical and trade.

Conclusion:

If you have capital for positional trading, go for positional trading with risk management because intraday trading will be like gambling and chances of loss will be higher.

Hopefully my knowledge and Golden rules will improve your trading.

I recommend opening a Demat and Trading account with only Discount Broker like Zerodha, which have good history and proven records, It provides good Customer support, Softwares, and Indicators for Professional trading, obviously you will save around 3-5% of the money on your brokerage.