Which is the dark side of stock market that no one talks about?
By:- TB Team | Spe.4,2022 | 16:34 PM IST
The Market moves in a trend, It regularly makes high and gives retracements too, if it moves 100 points up, it will move 75 points down and after hitting your SL, it will start moving up. Entry as per Cycles is the Dark secret no one is talking about.
Stock Market Trading has spread across the world. It's made its way into working professionals and business people(primarily men).
But there's one thing that makes me sad about how people approach trading.
Equity cash market is not zero sum game.f&o is zero sum game where one profit other will loose and in cash market if one book profit in share that doesn't mean that somebody losing.other who buyes the stock from the person who is profiting person They know that this stock has potential to go up and they know the fundamental of the company.warren buffet said the money goes to impatient to patient people.derivatives is zero sum game not equity.
Most people don't get complete clarity before they start jumping into the trading arena.
Let me explain.
I recently encountered tons of discussions/debates between people talking about the 'Dark Side of the stock market.'
There were 2 key things I noticed:
First, the people who talked about the 'Dark Side' of the market were themselves, not regular traders. They either took trades for a few days and lost their capital or took trades 'occasionally' (who knows what that means).
Second, they've not studied the stock market deeply. Their own understanding of trading is limited to what traditional definitions say or hearsay.
I have been trading in the market since 2007 and took it as a full-time career in 2016. I have seen a few people who made more than 1 crore in a day, but I have also seen many people who lost all their capital in one day.
So, based on my trading experience, below are the dark secrets of stock market trading:
Secret #1
Stock Market Trading is similar to a fierce fight between YOU vs. Mike Tyson, Muhammad Ali, Rocky Marciano, Manny Pacquiao, etc., altogether simultaneously.
At least in boxing, you will see who is punching and from which direction punches are coming.
But in trading, you don’t get a chance to see these punches from experts.
It is because trading is designed in such a manner. Anyone can enter and participate in the game. When you can take a trade, always remember you are fighting with many people who have spent decades in this business!
Secret #2
For 3–5 years, the market has been run by robots, not people. Computerized algorithmic models punch the vast majority of the trades/quantity.
We saw many freak trades and price spikes because of the bug in the coding strategies.
Secret #3
There is no such thing as 80–90% accuracy without compromising on the profit factor. People who claim 80–90% accuracy are either god or fake.
Secret #4
The market doesn’t care about your reputation, education qualification, or experience.
If you are right, it gives the money, and it steals back your money if you are wrong.
Secret #5
Many people still don’t know the difference between a Traditional Broker and a Discount broker.
Hence, many people (who opt for conventional brokers) end up paying more brokerage and fees to them (it is insanely high, sometimes up to 5–10 times of the discount brokers).
Secret #6
In the long run, it is impossible to make money depending on the news. This concept looks good only in movies (ex-The Big Bull).
Secret #7
Trading without stop-loss, keeping stop-loss only in mind, or having stop-loss on a closing basis is a sin in the stock market.
People who follow any of the above techniques will wipe out their accounts soon.
Secret #8
Trading Psychology and Money Management are more important than technical analysis.
Secret #9
Most of the IPOs are overpriced. Because of the hype created before the release, many people subscribe to these IPOs and lose money.
Secret #10
The market is a zero-sum game (except for the brokerage/taxes).
When the market falls, many news channels claim, like some NNN,000,000 dollars have been wiped out from the market.
But technically, this statement is not correct. Because when the market is falling, there might be a person (or many people) who opts for a short trade.
After the fall, they would have made enormous profits, and they enjoy their vacation on beaches.
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