QUESTION: Who can Book Losses Comfortably ?
ANSWER: Guess, no one. Including us.
Without a doubt, Every Man / Woman is way to emotional in Money Matters. And that is why Market Players, Participates either Make wonderful or Worst Ever decisions regarding Entry Exit of their financial life.
No Wonder. We all are humans. Emotion is the proof of “Being Human”.
And on lighter note, that is why Salman Khan, Amir Khan, and Shahrukh Khan are successful. Don’t believe me, ask any girl, lady or happily married husband.
It is very easy to say that Trade Emotionless but hardly PRACTICAL advice to adhered too.
That is why we structured Pillars’ Strategy keeping in mind all of above & more.
STOPLOSS is Important but not the only Holy Grill:
Some times we must / should ignore SL because of Price Volatility and Technical Imbalances vis-à-vis Fundamental Valuations and most importantly overall Market Trend.
Below is summary of earlier Calls where we did not apply SL but later on got successful exits.
First). INDUSINDBK: MAY 2019 – BUY,
Second). INFY: JULY 2019 – SHORT SELL,
And now, HDFCBANK: FEBURARY 2020 – BUY
First two, took time, but gave us cost to cost Exit. And we are confident that third one also would do the same-thing but, of course, time is uncertain.
However, it does not mean that we do that all the time. Rarely, we run away in applying Stop Loss. Below are few examples where we did honour our Stop-losses, irrespective of amount.
JANUARY 2020 – Booked losses in DLF,
DECEMBER 2019 – Book Losses in NIFTY Futures,
OCTOBER 2019 – Booked Losses in M&M, JSWSTEEL,
MARCH APRIL 2019 – Book Losses in COALINDIA, MCX, IGL
Reasons of not honouring SL in case of HDFCBANK:
1). On 26 & 27 February – closed below SL by 75 & 55 paisa at 1199.25 and 1199.45, respectively. On 1200 Rupee Stocks this is to be over looked.
2). Then came the NIFTY gap-down & subsequent fall of 500pts for the day on 28 Feb.
3). Even then, HDFCBANK had shown relative Strength and now also holding nicely, especially after NIFTY had fallen more than 1100pts from our Entry in HDFCBANK dated 18 February, whereas it is down 60pts.
4). Anyways, our view is Bullish for NIFTY BANKNIFTY, though waiting for Index BUY execution and HDFCBANK is one of the large heavy weight Stock. Therefore, hopeful to get cost to cost Exit or maximum with a minor cut.
5). Derivates’ Lot Size Small, Used Span Margin is comparably less. Running MTM losses are in manageable situations given Market Conditions. Plus, High Quality Company.
6). Lastly, we are improvising Pillars’ Strategy with every passing day so that HDFCBANK kind of examples do not repeat next time. But, anyways we have to bear with Market.
Thanks for Reading.
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