Hey Guys!!!
Just knowing how money works and where various anomalies in global markets exist will not make us money, but by translating that understanding into trades will.
Financial markets across the globe and across the asset classes (Equities, Debt, Commodities and Currencies) work with one common logic - DEMAND AND SUPPLY. When most of the market participants sell a particular instrument the supply is more and when most of them buy the demand is more. When the demand is high the prices go up and when the supply is high the prices come down.
There are infinite number of opportunities available in the markets everyday. It is just that few are more compelling than the rest. By picking up a more lucrative opportunity the probability of making money is that much higher. Having said which every opportunity is a risk return trade off. It depends on how much risk we are willing to take to make a certain amount of profit. Once we get this piece right the game is done. It is easier said than done. This precisely explains why we have millions of people across the world who have lost all their life's saving in quest for that few notches higher returns and only a handful who would have made handsome returns.
The debate between Investing and Trading is an everlasting one. Investing is a slow and steady process where one identifies good businesses and be associated with them as if your own and make money over a period when the business grows. Long term is anything more than a year and short term is about three to six months. Trading is more opportunistic and to cash in on the very short term anomaly and get out once it runs out of steam. Here long term is a month short term is as short as few hours.
I am both a trader and an investor and I am always on the look out for opportunities existing in the markets, particularly Indian. Neither trading in overseas instruments from India is easy nor I have had the need to search for opportunities outside India. Indian markets are far from being matured to not throw up such opportunities. In fact Indian markets are so shallow that such opportunities are available by the scores at any given moment. As I said earlier I will try and identify only those trades that are very compelling and only those stocks that are available at exciting levels.
Coming to the disclaimer part, even I am one of those traders/investors yet to get in to the profits at my overall portfolio level. But definitely not among the ones that have lost all their life's savings. My quest for good opportunities is always there and will discuss a few I find very lucrative. I am a free lancer and I do it for fun. I am not associated with any brokerage firm or any investment advisory firm. I do not have access to any research report or any recommendation that is not in the public domain. It is safe to assume that I may have my holdings in the trades and ideas suggested. Last but on the least, I urge the readers not to trade basis my advisory. You can use it just to know some opportunities existing and take your own decision basis your risk appetite.
Most of the trades I suggest here would be hedged ones to limit the losses and investing ideas are medium to long term ones.
Regards
SVJ
