Adherence is sincerely recommended to trade and
achieve gains in these Speculative Trade Markets.
1
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Do not trade with hesitance, half heartedly
or in over confidence. You may incur small but repeated losses if you are scared
of the markets or heavier ones if you are overtly brave and foolhardy.
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2
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Be patient when your trade positions are
moving in the right expected direction to extract maximum gains and ensure
the gains by improvising the stop-loss level, time and again. Do not be
pessimistic here or else you may book gains pre-maturely & may later
repent on exiting early. This may lead to keeping on re-entering the same
trade at further levels & repeatedly exit at small reversals in panic,
which in turn would erode earlier small gains & also build losses. It's
not whether you're right or wrong that's important, but how much money you
make when you're right and how much you lose when you're wrong & that
makes all the difference between Winners & Losers.
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3
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Do not be over optimistic when trades have
hit the suggested stop-loss levels and make sure you exit there. You may miss
better and multiple opportunities on being stuck in deals gone wrong leading
to higher and higher losses each day.
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4
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Do not discuss your open positions with one
and all. This will lead you nowhere and confuse you more, as all would air
their own views on the same (whether knowledgeable or not) and many a times,
would make your trade decisions seem as foolishly and hastily taken. If only
you would have consulted them earlier...
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5
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Do not develop a tendency of being a Bull or
a Bear in these markets. There is only one side to the markets and that is
neither the Bull side nor the Bear side – But ONLY the Right Side at the
Right Time. Trend is King, so follow it at all times.
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6
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Realize that you are in a bad situation and
exit fast when you need to pray for relief at each rise or fall in a trade
which is leading you further in a deep pit towards heavier losses.
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7
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Follow ONLY one Analyst’s or Technical Advisor’s
guideline at a time, as more guidelines will again create a lot of confusion.
You can opt for or look out for an alternate guidance when the earlier
guideline proves to be less productive or loss making, but not
simultaneously.
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8
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Be honest to yourself as hoping or praying
for something different, than the actual reality or situation is nothing less
than fooling your own self.
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9
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There is NOTHING such as HUGE, mind-blowing
and sky-high profit makings overnight, as assured by many to win a prospective
client. YES, there are sizeable gains and high returns for a disciplined
trader and may return exactly the opposite, if not worse, for the
non-disciplined. Do not enter this trade market under any illusions of
getting to be a Billionaire overnight. It will never happen. In fact all that
you now possess may also be lost.
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10
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DO NOT BORROW or trade with funds that are
not yours or pump in more funds by borrowing to hold on to loss making
trades. Trade only with own funds that are spare-able and be prepared
mentally in loosing even that in totality, in the worst case.
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11
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Never trade or enter / exit positions in
panic. Volatility is a non-separable component of this trade market and will
be present most of the times.
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12
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Do not be a party to rumors or be guided or
misled by these. Verify & double-check on the source for genuineness.
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13
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Stay away from the people who have a habit of
saying “I had told you – See now?”. These are the very same people who would
never put anything on paper or ever trade on their own views- with their own
funds, as in reality they do not have any concrete views or knowledge. They
are mere sponges on an ego trip, who keep soaking or gathering tidbits of
information from anywhere available irrespective of their reliability, put
all together and spread the newly formed news. If what they say goes wrong,
they would disappear and would be seen nowhere or if found, might now have
some stronger views and reasons for why the wrong happened as generally these
kind of people are very good convincers & are blessed with the gift of
gab. Listening to these characters and their views is very dangerous. As the
wise always said: – “Half knowledge is always the most dangerous”, “Ignorance
is Bliss” and “Blessed are the fully knowledgeable”.
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14
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DO NOT TRY to be the TREND SETTER or the
first one to know where a particular trade will turn from. No one can
possibly be, except by a sheer matter of chance, the best seller or the best
buyer – so why try it? You might end up loosing a lot of money and also
becoming the laughing-stock for all. Follow the trend and make respectable
gains, “Quietly”.
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15
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Do not enter the Commodity Markets with Stock
Market trading ideas. Though both are speculative trade markets, there is a
substantial difference in both and generally have opposite trading patterns
and thumb rules.
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16
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Providing past performance records is not a
mandatory rule for Analysts or Advisors, and the same info (wherever posted)
can be misleading, as the same can be manufactured by the end of day to dupe
prospective clients. Do not try to look for something that can misguide you
& lead you on the wrong path, ending up in losses - money-wise & also
confidence-wise. Upon subscription by the trader, the same people showing
fantastic results on their websites, but performing poorly in real-time may
later not be available even for a discussion or may later say that “Past
performances are not an assurance of any future success”. So take a Trial for
a fortnight or a month (not for a day or two), do some live paper trading
& only trust the live performances. Judge the genuineness of the research
quality and real-time trading support only on the basis of live experience
and not by past performance records. Most of these records could be fakes.
Better to pay for the Trial & come to the right conclusion, rather than
loose a lot of capital by trading on faith generated by looking at &
getting impressed by the past performances.
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17
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“Trading without a Stop-Loss & yet making
gains is sheer Talent – Not trying such stunts is Intelligence”. The
stop-loss practice is for your own benefit as this provision has utmost
importance and is not provided on each trading ticket by the exchanges, just
for the heck of it. If the trades turn & move in the opposite directions
beyond entry levels, they might further move very fast in a volatile manner
& the losses accrued, in the absence of a stop-loss, can be
un-imaginable. There are several things happening across the globe
constantly, which affect the price movement, direction & volumes in
commodity trading, as basically they move in accordance with demand and
supply situations & are also greatly affected by the Geo-political
scenarios all over. It is not humanly possible to track each & every
occurrence, watch out for economic data’s released all around the globe and
understand the level of their impacts on the trade movement & direction
of all commodities, though you may be constantly updated on most of the
developments, most of the time. Many times the reaction or the impact of
these developments is so quick & enormous, that large & rapid
movements in rates are instantly triggered with high volatility, even before
the news on these developments reach all over the world. In such a scenario,
you may never know as to what level these trades could go to & the losses
(though sustainable by a few) may be very large. These losses are not the
only losses that you incur if caught in such a situation – you also miss out
on the opportunity, the same commodity is offering, in the opposite direction
and also by other trades as most of your attention and funds will now be
concentrated and caught up on this particular trade gone wrong. Remember -
Growing wealth is important, but safe guarding seed capital is even more
important. It's easier to resist & also absorb losses at the beginning
than later.
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18
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Averaging in loss making positions is a
practice which is most commonly seen & generally leads to more dangerous
losses. This is also recommended by a number of advisors, but I certainly do
not recommend it. In fact I strongly oppose it. Remember – YOU are incurring
the loss & not your advisor.
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19
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Putting all your eggs in one or a couple of
baskets could prove to be more dangerous for the day trader. Having a wider
investment or a trading spectrum would be more effective. All entered trades
may never go wrong simultaneously but a stray one or two could and what, if
you have traded in only those? It may also happen that the 1 or 2 trades that
you have entered into, have moved in the right direction, but have not
achieved the expected high results or gains in comparison to the ones you
have left out. So it is only advised and not stressed upon – that the trader
should take positions in a wider range of trading / investment opportunities
to achieve better results.
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20
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Do not be biased to a particular commodity.
Look at all commodities (having healthy trading volumes) only as profit
generating opportunities & not at the English name or Social status of
the commodity.
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21
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Always remember –“You cannot use yesterday’s
ideas for today’s business and expect to be in business tomorrow”. Be ready
to accept and implement change immediately and constantly as “Change” is the
only factor that’s constant in the world – everything else keeps changing and
its meaning is all the more true in these highly volatile and ever-changing
market scenarios.
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