dear Shankarji,
u have asked
"Majority of people are trading different stocks at one time and losing complete focus and concentration. Will you please give your views and the importance on concentrating Nifty or any stock exclusively"
--
well, i feel in stock market world, there are several totally different mini-worlds.
- stock investing
- day trading in index futures
- day trading in stock futures
- swing/positional trading in index options
- swing/positional trading in stock options
- scalping
- hedging
- arbitrage etc etc
all of these, i reapeat, all of these look similar but are a universe apart...
all of these require different training, different temperament and carry different risk/reward scenario.
different funds / entities specialize and focus on different categories from the above.
i am often utterly surprised to recall how i used to hop between day trading to swing trading to investing to scalping etc etc, just like fugitive who, when wanted by one state's police runs across the border to another trading territory.....only to be decimated wherever he goes.....
grass and trade on the other side always looks greener!
--
coming specifically to what u have asked shankarji,
stock trading is very very different from index trading.
since index is the average of top stocks (floating weighted mean of market cap) it's behaviour is totally different from the behaviour of individual stocks. it is less volatile and more predictable. it's response to technicals is more "true". in other words, index futures responds more accurately to technicals than individual stocks. also, stocks need different indicators to tame than indices.
contrary to a myth, to trade a stock u do need to have a tab on the fundamentals of that stock too besides understanding the macro exconomical factors which can effect them. otherwise, one misstep will take away much more than u have gained in many small favourable moves.
also, since the liquidity of nifty futures is much more than that of stocks, the premiums and market rates of nifty futures are much more "genuine" and much less "inflated" or "distorted". slippages are also quite less.
even among bank nifty and cnxit and nifty, there is heel of difference in scenario!
--
stocks are wild horses while nifty is a disciplined trained well bred stallion.
u decide which one to ride depending upon whether u r a tarzan or a professional jockey!
u have asked
"Majority of people are trading different stocks at one time and losing complete focus and concentration. Will you please give your views and the importance on concentrating Nifty or any stock exclusively"
--
well, i feel in stock market world, there are several totally different mini-worlds.
- stock investing
- day trading in index futures
- day trading in stock futures
- swing/positional trading in index options
- swing/positional trading in stock options
- scalping
- hedging
- arbitrage etc etc
all of these, i reapeat, all of these look similar but are a universe apart...
all of these require different training, different temperament and carry different risk/reward scenario.
different funds / entities specialize and focus on different categories from the above.
i am often utterly surprised to recall how i used to hop between day trading to swing trading to investing to scalping etc etc, just like fugitive who, when wanted by one state's police runs across the border to another trading territory.....only to be decimated wherever he goes.....
grass and trade on the other side always looks greener!
--
coming specifically to what u have asked shankarji,
stock trading is very very different from index trading.
since index is the average of top stocks (floating weighted mean of market cap) it's behaviour is totally different from the behaviour of individual stocks. it is less volatile and more predictable. it's response to technicals is more "true". in other words, index futures responds more accurately to technicals than individual stocks. also, stocks need different indicators to tame than indices.
contrary to a myth, to trade a stock u do need to have a tab on the fundamentals of that stock too besides understanding the macro exconomical factors which can effect them. otherwise, one misstep will take away much more than u have gained in many small favourable moves.
also, since the liquidity of nifty futures is much more than that of stocks, the premiums and market rates of nifty futures are much more "genuine" and much less "inflated" or "distorted". slippages are also quite less.
even among bank nifty and cnxit and nifty, there is heel of difference in scenario!
--
stocks are wild horses while nifty is a disciplined trained well bred stallion.
u decide which one to ride depending upon whether u r a tarzan or a professional jockey!
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