Picking Stocks For Trading– Did You Do It Right ?

We had a long series of F&O trading in March 2018.

Here at OptionsNext, we had a series about picking stocks. We made selections based on the parameters of apparent strength and weakness just by looking at 30 day variation and the weekly trends of the stock.

We were right in some and wrong elsewhere.

The important point is to let the profit run in case of being right and cut short the losses in a wrong trade.

Yesterday, the results for the series were posted.

Today, let us have a look at the financials of the exercise.

Here is the net result of all the selections on expiry.

We have been right in 10 trades and wrong in 6 of them. Average gain per trade is higher than the average loss in a losing trade.

And this profit could have been earned with a total of 16 trades in an entire month.

It is not the number of trades, but the profit numbers of the trade that count.

Time to move to April 2018 Contracts :

After the long weekend, it will be business as usual from April 02.

We shall have the same selection process.

Already we have decided to continue with RELIANCE CAPITAL, RPOWER and HINDPETRO as SELL SELECTIONS.

For the other selections, I will be posting tomorrow.

Keep watching this space and keep doing your homework.

Enjoy the trading holidays.

Comments

T. Sai March 30, 2018 at 11:50 am

Thank you for your valuable service sir.
Kindly conduct the training programm in Vijayawada.

admin March 30, 2018 at 12:13 pm

I would love to conduct a session there. But for the program to be viable at least 10 participants are required. Please make efforts to get those 10 participants and you have a program at Vijayawada.

Or else, you can travel to Bangalore to participate in the session on April 08.

Regards

Pramod
Reply

Ashish Agrawal March 30, 2018 at 1:50 pm

Hi Sir,
Have been following this blog since the start of the series. One small doubt here – When you suggest these trades, are these to be executed as call options ? For example – Reliance Capital, currently trading around 420 levels and we expect that go further down, so should we be buying a 360 or a 380 Call option ?

admin March 30, 2018 at 3:35 pm

Dear Ashish,

it seems there is some confusion. When we have a negative view about the stock, we buy PUT.
Let us say the current price is around 420 and we anticipate that price will move to below 400 levels very soon, we should be buying PUT 400 or PUT 380 depending on what we expect from the trade.
A CALL does not enter the picture here.
Reply
- Sha Navas March 31, 2018 at 10:08 pm
  
  Sir,
  My understanding is:
  If we buy CALL options, strike price should be slightly less than the spot price and if we buy PUT options, the strike price should be slightly higher than the spot price.
  Please clarify on this.
  Does it really matter much if the strike price is ‘off the mark’ by just one step?
  Thanks.
  Reply
  - SHISHIR CHAKRABORTY April 1, 2018 at 7:22 pm
    
    Hi Sha navas,
    Good point. As per my newly found understanding in this area, the maximum returns are fetched if one buys in OTM to ATM band of strike prices. If you buy CALL above the Spot price you get into ITM zone which will demand you more premium(heavy on your pocket) and at the same time they are very sensitive to the spot price movements because one of the Greeks ∆ Will have a higher value(0.6 to 1.0) . So the rate of change of premiums will be greater there and can be detrimental in case of opposite spot movements. Eg: for CALL if spot decreases by 30 points your premium would come down heavily.
    
    Correct me If I am wrong.
    Regards.
    Reply
Ashish Agrawal March 30, 2018 at 4:31 pm

Yeah sure, typo error. Meant Put ! Thanks
Reply

Ravi March 30, 2018 at 3:18 pm

Hello Sir,
Any planned session in Chennai near future ?

Thanks,
Ravi.

Ritesh Kumar March 30, 2018 at 3:48 pm

Thank you Pramod sir for this live and real time trading done through out the month of march. The end result is incouraging. Being patient and sticking to plan worked wonderfully.
I have attended the optionsnext workshop held in Delhi this February. Its nice to see the topics discussed there about stock selection working in real time.
Hope to see more action in April series as well.
Ans thank you once again for guiding me and others about trading.

admin March 30, 2018 at 6:27 pm

Thanks Ritesh for the kind words. It gives me great pleasure to note that these articles are helpful.

Please keep reading.
Reply

SHISHIR CHAKRABORTY March 30, 2018 at 5:13 pm

Hello Sir,
Your Mantra of ” Everyone can do it” made be read your entire blog after reading your informative answers on Quora. I am a novice investor having not so deep knowledge but considerable interests to undertake Options Trading. I feel enlightened by your revealing mindset needed to undertake right trades. Will be following your blog and parallely improve my selection window to start my tentative options trading on arrival of funds. It was immensely helpful. Thank you and Regards.
Shishir Chakraborty

admin March 30, 2018 at 6:26 pm

Thanks for the kind words.

This series was about selection process. We shall now take it to Options Trading process.

lease keep reading.
Reply

Ashish Krishna K March 30, 2018 at 10:25 pm

Hello Sir,
This is a great strategy, especially for those of us who is busy with our jobs and can’t track the markets during open hours.
I really love this strategy Sir, but I do have one question.
I am still not clear about the exit for this strategy, can you please elaborate when to book losses and when to book profits?

Thank you Sir

SHISHIR CHAKRABORTY March 31, 2018 at 10:34 am

One of your big Do’s in options u mentioned is to never Trade Alone. Sir , I am quite unfortunate to have any like minded company not even anyone into equities through SIPs. In this case what do you recommend as I am determined to master this skill alone, come what may. Are there any other means to have an interactive interface for people like me. Thankyou

G2 March 31, 2018 at 6:06 pm

Is this a fact that
If I sell PE or sell ce , I am future writer or i writers are there in options trading only?

Satish April 18, 2018 at 12:40 am

Hi sir,
This is a brilliant way to engage your followers by ensuring they learn out of it. Having such series demands time & patience. I appreciate your contribution to our trading journey. Keep up the good work. Await more initiatives in future.

Cheers,
Satish

admin April 20, 2018 at 6:53 pm

Thanks Satish for the kind words.

The point I want to explain is that Stock Selection is easy and everyone can do it. what is important is to stay with the trades specially those which are doing well. Trade less and take whatever the market gives.

Thanks again.
Reply

Ravi Kumar July 18, 2018 at 5:06 pm

Hi Sir,
I have been reading your Quora answers from past 6-7 months (on and off) and liked your way of answering in first few instances itself!..
Just yesterday, got to know about this blog and already reading all the blogs ever posted here (Currently in this page, starting from the 1st post!)

Few questions
1. When is the next Bangalore session? am interested to attend
2. I assume all these trades in March & April are real trades and not just educational (not that it matters). If real trades, How much avg capital we need to have ?

I really love the simple stock selection process you have illustarted..giving hopes to many like us that, Yes, We can Trade profitably too!!

Thanks and God bless!
-Ravi

admin July 18, 2018 at 5:31 pm

Thanks for reading here.

As regards trades being real please go through the comments of the readers during June and July trades. It is about them not about me. If the readers are able to change their way of trading and make good profits that gives me immense pleasure.

Reply is being sent to you separately through mail.
Reply

T. Sai March 30, 2018 at 11:50 am

Thank you for your valuable service sir.
Kindly conduct the training programm in Vijayawada.
- admin March 30, 2018 at 12:13 pm
  
  I would love to conduct a session there. But for the program to be viable at least 10 participants are required. Please make efforts to get those 10 participants and you have a program at Vijayawada.
  
  Or else, you can travel to Bangalore to participate in the session on April 08.
  
  Regards
  
  Pramod
Ashish Agrawal March 30, 2018 at 1:50 pm

Hi Sir,
Have been following this blog since the start of the series. One small doubt here – When you suggest these trades, are these to be executed as call options ? For example – Reliance Capital, currently trading around 420 levels and we expect that go further down, so should we be buying a 360 or a 380 Call option ?
- admin March 30, 2018 at 3:35 pm
  
  Dear Ashish,
  
  it seems there is some confusion. When we have a negative view about the stock, we buy PUT.
  Let us say the current price is around 420 and we anticipate that price will move to below 400 levels very soon, we should be buying PUT 400 or PUT 380 depending on what we expect from the trade.
  A CALL does not enter the picture here.
  - Sha Navas March 31, 2018 at 10:08 pm
    
    Sir,
    My understanding is:
    If we buy CALL options, strike price should be slightly less than the spot price and if we buy PUT options, the strike price should be slightly higher than the spot price.
    Please clarify on this.
    Does it really matter much if the strike price is ‘off the mark’ by just one step?
    Thanks.
    - SHISHIR CHAKRABORTY April 1, 2018 at 7:22 pm
      
      Hi Sha navas,
      Good point. As per my newly found understanding in this area, the maximum returns are fetched if one buys in OTM to ATM band of strike prices. If you buy CALL above the Spot price you get into ITM zone which will demand you more premium(heavy on your pocket) and at the same time they are very sensitive to the spot price movements because one of the Greeks ∆ Will have a higher value(0.6 to 1.0) . So the rate of change of premiums will be greater there and can be detrimental in case of opposite spot movements. Eg: for CALL if spot decreases by 30 points your premium would come down heavily.
      
      Correct me If I am wrong.
      Regards.
- Ashish Agrawal March 30, 2018 at 4:31 pm
  
  Yeah sure, typo error. Meant Put ! Thanks
Ravi March 30, 2018 at 3:18 pm

Hello Sir,
Any planned session in Chennai near future ?

Thanks,
Ravi.
Ritesh Kumar March 30, 2018 at 3:48 pm

Thank you Pramod sir for this live and real time trading done through out the month of march. The end result is incouraging. Being patient and sticking to plan worked wonderfully.
I have attended the optionsnext workshop held in Delhi this February. Its nice to see the topics discussed there about stock selection working in real time.
Hope to see more action in April series as well.
Ans thank you once again for guiding me and others about trading.
- admin March 30, 2018 at 6:27 pm
  
  Thanks Ritesh for the kind words. It gives me great pleasure to note that these articles are helpful.
  
  Please keep reading.
SHISHIR CHAKRABORTY March 30, 2018 at 5:13 pm

Hello Sir,
Your Mantra of ” Everyone can do it” made be read your entire blog after reading your informative answers on Quora. I am a novice investor having not so deep knowledge but considerable interests to undertake Options Trading. I feel enlightened by your revealing mindset needed to undertake right trades. Will be following your blog and parallely improve my selection window to start my tentative options trading on arrival of funds. It was immensely helpful. Thank you and Regards.
Shishir Chakraborty
- admin March 30, 2018 at 6:26 pm
  
  Thanks for the kind words.
  
  This series was about selection process. We shall now take it to Options Trading process.
  
  lease keep reading.
Ashish Krishna K March 30, 2018 at 10:25 pm

Hello Sir,
This is a great strategy, especially for those of us who is busy with our jobs and can’t track the markets during open hours.
I really love this strategy Sir, but I do have one question.
I am still not clear about the exit for this strategy, can you please elaborate when to book losses and when to book profits?

Thank you Sir
SHISHIR CHAKRABORTY March 31, 2018 at 10:34 am

One of your big Do’s in options u mentioned is to never Trade Alone. Sir , I am quite unfortunate to have any like minded company not even anyone into equities through SIPs. In this case what do you recommend as I am determined to master this skill alone, come what may. Are there any other means to have an interactive interface for people like me. Thankyou
G2 March 31, 2018 at 6:06 pm

Is this a fact that
If I sell PE or sell ce , I am future writer or i writers are there in options trading only?
Satish April 18, 2018 at 12:40 am

Hi sir,
This is a brilliant way to engage your followers by ensuring they learn out of it. Having such series demands time & patience. I appreciate your contribution to our trading journey. Keep up the good work. Await more initiatives in future.

Cheers,
Satish
- admin April 20, 2018 at 6:53 pm
  
  Thanks Satish for the kind words.
  
  The point I want to explain is that Stock Selection is easy and everyone can do it. what is important is to stay with the trades specially those which are doing well. Trade less and take whatever the market gives.
  
  Thanks again.
Ravi Kumar July 18, 2018 at 5:06 pm

Hi Sir,
I have been reading your Quora answers from past 6-7 months (on and off) and liked your way of answering in first few instances itself!..
Just yesterday, got to know about this blog and already reading all the blogs ever posted here (Currently in this page, starting from the 1st post!)

Few questions
1. When is the next Bangalore session? am interested to attend
2. I assume all these trades in March & April are real trades and not just educational (not that it matters). If real trades, How much avg capital we need to have ?

I really love the simple stock selection process you have illustarted..giving hopes to many like us that, Yes, We can Trade profitably too!!

Thanks and God bless!
-Ravi
- admin July 18, 2018 at 5:31 pm
  
  Thanks for reading here.
  
  As regards trades being real please go through the comments of the readers during June and July trades. It is about them not about me. If the readers are able to change their way of trading and make good profits that gives me immense pleasure.
  
  Reply is being sent to you separately through mail.

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Picking Stocks For Trading– Did You Do It Right ?