Thursday, March 30, 2017

my last post....

markets move like commandos in the bush.....camouflaged in battle green dress. they make fast moves of undisclosed magnitude at undisclosed time and then consolidate for undisclosed time periods.

sharp/big moves are (seemingly) randomly mixed with ranges. with this realisation dawning, i have been feeling more and more in the recent times that these moves can be caught successfully and efficiently only with investing. trading has to be a tactic and subset and feeder of investing......

i have been trading for many years. i have made good money. and i have continuously been having my share of losses. i belong to that class of traders who trade without stoplosses mainly because of the protection offered by the options snakes.

riding the skill sets developed and acquired over the years i have been reasonably negotiating the double edged sword of naked options. had developed quite a good affinity for them. but lately, i have noticed that the returns are not commensurate with the mental application. trading, as a stand alone path, is not efficient way to survive.

roz kuuaan khodo roz paani peeeo wali baat.......with intermittent drowning. so lately, i didn't stop myself adjusting to the change that little voice in me was whispering.....i started paying attention to investing.

i started looking for fundamentally strong scrips and using my trading instincts to SIP them. buying more of those scrips when monkeys would throw them on one or the other genuine/not-so-genuine pretext......none of which will sustain on the long term.......

this approach has been paying v handsome dividends while me remaining almost free most of the time. these days. initially, i reduced options trading just to hedge. but lately, i have lost interest in protecting my investments because i have found these counterproductive. i would love to see MY stocks crashing. when that is the case, why waste proportionate money on hedging? on that logic, i have now opted out of options as well.....whatever i was holding i am holding, but post this series, won't be. just investing for long term using trading instincts to buy diamonds thrown by scared monkeys......

following Warren Buffett quotes express my mindset reasonably well                      

"Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market."                      

"Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it."                      

"Time is the friend of the wonderful company, the enemy of the mediocre."                      

"A great investment opportunity occurs when a marvelous business encounters a one-time huge, but solvable problem.".... Warren Buffett                      

"Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.".... Warren Buffett

let me give sn example. if a scrip A is at 110 and expected to touch 205 in few quarters based on P/E calculations etc etc of projected and expected growth, and is fundamentally strong with excellent corp governance record, what would u do if this fact becomes widely known thereafter and scrip goes down to 85? i will buy with a thank u note and forget about it. everything which comes in the news is hated as a news after a while courtesy public appetite for "new" news. i keep sitting like a bagula near the pond marking the fundamentally good scrip fishes. and wait for the trumps and brexits and gov rajans and elections and rumours and bla bla for those scrips to fall. not all fall......but some do...and a few to shocking levels.....then i ipen my eyes and pick them with my beak. that's all i use my so called trading sense. i don't think i would ever be using my technical indicator know how much from here on. just lazy patience sense. i learnt many things and then learnt to unlearn. feels bad, but feels good