in the financial jungle, operators (hedge funds, large banks, fii's, cartels etc) are the predators preying the smaller and retail players.
fight with them face to face and u stand no chance.
fortunately, they are not invincible. they have their loop holes. they have their weak links. they have their unguarded lacunas. they also leak. they have their pockets of inefficiencies. they have their moments of vulnerability.they have their "situations". they also have times when they have their guards down. they are also....quite mortal....
so, what are those limitations, handicaps, weak points?
here are some i have identified and am learning to exploit:-
- operators can't hide the traces of their moves in technical indicators. they can make it complex, confusing and smart, but they can't erase their tracks.
- operators can't stretch beyond a point. they have to obey fundamentals. they can go this way that way to an extent. beyond a limit they might strangulate themselves. and farther they go from fundamental reality, faster they have to retreat.
- operators have to eat all the premium before the expiry of the series. they can't keep their cakes in their hands and just run. they have to go into the caves if ranges, whether they like it or not, so that they can eat the cake in their hands and make the money their "clients" want them to, come-what-may.
- operators have to fight with other operators. there are times when sharks come too close and there is a clash of interests. though they are fairly integrated, yet they are competitors and vying for the same pool of investors' trillions. operators can't be too insensible to be stumped by competition.
- operators have to let smaller operators make some money. they have to "keep some people happy". they can't afford enemies "who know what they do". they have to "share". so, operators can't be that reckless as they are thought to be.
- operators have to keep giving some crumbs to the retail fish traders. they can't just let the small fish starve to death. otherwise, who will come to the markets? just to be preyed?
- operators can't overdo it. afterall, there are market regulators, watchmen, media, governments, whistle blowers, activists.....nobody can afford the collapse of the system.
- operators don't know everything. well, they know many things, they have all the crucial insiders' information, but they don't know everything. they can't control everything in the world. there are bound to be "surprises"! they can't be too adventorous!
- operators have to do stupid things to trap the overwhelming majority of retail traders. the one who can see their bluff and call it can make a lot of easy money ridiculously easily!
- operators have to balance indices with stocks and stocks with indices. operators have separate positions in stocks and indices. there is a limit to micromanage positions in everything in perfect balance.
- operators are human.....and prone to stupidities and overlooks!
- world is too complex to comply to a single or a few dictats! you simply can't manage everything.
- operators have targets to meet. they have to return the easy money to the nervous banks. operators are traders themselves.
- operators have very limited room to play the game. they can take the market either up or down or keep it rangebound. their options are very limited. this is too boring and limited in scope! they have to do the dodge trick within these constraints.
- operators are big bluffers. that's what is their only tool. call it surprise, shock, dodge, moneypower, bluff, confusion, irrationality, speed....they try to "get rid of you", trap you....with every possible deceptive way! and this is where they are vulnerable......anyone, who refuses to be intimidated, befooled, tricked, confused......anyone who can see thru their game.....can not only escape their trap but hit them where it hurts. the only consolation for them is that such retail players are too less.....almost insignificant proportion.
a retail trader can take advantage of all this. operators are poor chaps. they have their limitations. they pray that u don't get those. if you can, you can turn the tables and bleed them. u can be the perfect suckers to the suckers.
be a guerilla fighter with the giants.it is where it hurts them and they can do little about that!
fight with them face to face and u stand no chance.
fortunately, they are not invincible. they have their loop holes. they have their weak links. they have their unguarded lacunas. they also leak. they have their pockets of inefficiencies. they have their moments of vulnerability.they have their "situations". they also have times when they have their guards down. they are also....quite mortal....
so, what are those limitations, handicaps, weak points?
here are some i have identified and am learning to exploit:-
- operators can't hide the traces of their moves in technical indicators. they can make it complex, confusing and smart, but they can't erase their tracks.
- operators can't stretch beyond a point. they have to obey fundamentals. they can go this way that way to an extent. beyond a limit they might strangulate themselves. and farther they go from fundamental reality, faster they have to retreat.
- operators have to eat all the premium before the expiry of the series. they can't keep their cakes in their hands and just run. they have to go into the caves if ranges, whether they like it or not, so that they can eat the cake in their hands and make the money their "clients" want them to, come-what-may.
- operators have to fight with other operators. there are times when sharks come too close and there is a clash of interests. though they are fairly integrated, yet they are competitors and vying for the same pool of investors' trillions. operators can't be too insensible to be stumped by competition.
- operators have to let smaller operators make some money. they have to "keep some people happy". they can't afford enemies "who know what they do". they have to "share". so, operators can't be that reckless as they are thought to be.
- operators have to keep giving some crumbs to the retail fish traders. they can't just let the small fish starve to death. otherwise, who will come to the markets? just to be preyed?
- operators can't overdo it. afterall, there are market regulators, watchmen, media, governments, whistle blowers, activists.....nobody can afford the collapse of the system.
- operators don't know everything. well, they know many things, they have all the crucial insiders' information, but they don't know everything. they can't control everything in the world. there are bound to be "surprises"! they can't be too adventorous!
- operators have to do stupid things to trap the overwhelming majority of retail traders. the one who can see their bluff and call it can make a lot of easy money ridiculously easily!
- operators have to balance indices with stocks and stocks with indices. operators have separate positions in stocks and indices. there is a limit to micromanage positions in everything in perfect balance.
- operators are human.....and prone to stupidities and overlooks!
- world is too complex to comply to a single or a few dictats! you simply can't manage everything.
- operators have targets to meet. they have to return the easy money to the nervous banks. operators are traders themselves.
- operators have very limited room to play the game. they can take the market either up or down or keep it rangebound. their options are very limited. this is too boring and limited in scope! they have to do the dodge trick within these constraints.
- operators are big bluffers. that's what is their only tool. call it surprise, shock, dodge, moneypower, bluff, confusion, irrationality, speed....they try to "get rid of you", trap you....with every possible deceptive way! and this is where they are vulnerable......anyone, who refuses to be intimidated, befooled, tricked, confused......anyone who can see thru their game.....can not only escape their trap but hit them where it hurts. the only consolation for them is that such retail players are too less.....almost insignificant proportion.
a retail trader can take advantage of all this. operators are poor chaps. they have their limitations. they pray that u don't get those. if you can, you can turn the tables and bleed them. u can be the perfect suckers to the suckers.
be a guerilla fighter with the giants.it is where it hurts them and they can do little about that!
1 comment:
As always very well said Jagmohan ji... Also, one i would recommend others who trade to manage their risk well by keeping the risk on a single trade within limits (Subjective). Critical thing is that capital should stay with you when you master trading... most of the people who even master trading have no capital left after some years because they get a hang of the game.... what a karmic lessson.... you know how to play the greatest game but you cant participate....
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