7 POWERFUL PERSONAL FINANCIAL HACKS that you wish you knew yesterday.

THREAD: Thumb rules that will make you better in managing your personal finance.

Collaborated with @AdityaTodmal

Do you want to know how to create a Trading Plan using only Price Action?

Here's a breakdown of 11 simple yet powerful steps to create one: 🧵

Collaborated with @AdityaTodmal

1/ Know your type:

First and foremost, understand whether you are a Scalper or Intraday trader or Swing trader or Positional Trader.

Create an account in @tradingview

2/ Set the Time Frame (TF) of the Charts:

• Scalper: the TF you would use would be in the range of 1- 5min
• Intraday Trader: 5-15min TF
• Swing Trader: Hourly to Daily
• Positional Trader: Weekly

3/ Be aware of the trend at higher TF.

No matter which type of trader you are, its important to know the trend at higher TF.

Crucial to know whether its a buy on dip market or sell on rise market.

In my outlook for the week for #BANKNIFTY & #NIFTY I cover multi TF analysis.

4/ Identify the major Demand & Supply Zone:

• A supply zone is the price area where traders have the highest selling interest or potential.

• A demand zone is the price area where the traders have the highest buying interest or potential.

𝐁𝐚𝐬𝐢𝐜𝐬 𝐨𝐟 𝐃𝐞𝐫𝐢𝐯𝐚𝐭𝐢𝐯𝐞𝐬 - 𝐏𝐚𝐫𝐭 𝐈𝐈𝐈

Topics covered:

• Moneyness of an Option

• Intrinsic value & Time value of an option

• Why Intrinsic value & time value matters

• Implied Volatility

Time for a 🧵

Curated in collaboration with
@AdityaTodmal

• Moneyness of Option contract:
• ITM option
• ATM option
• OTM option

• Intrinsic Value of an option:
• Positive payoff for the buyer

• Intrinsic value of ITM CE options = Spot- Strike

• Intrinsic value of an:
i) ITM for a CE option: Positive
ii) ATM for a CE option: Zero
• Intrinsic value is never Negative

How to save taxes on the trading profits for an individual

4 Legit ways to retain most of the trading income: 🧵

Collaborated with @AdityaTodmal

1. Divide your capital amongst your family members:

• Ensure they are not salaried employees as they might not be allowed to trade as per their employer's policy.

• Your family is your strength, not just emotionally, but financially too.

• E.g. your net taxable income works out to Rs. 50 lacs, as per the new tax regime, you are in the 30% tax bracket.

However, if you divide the capital amongst your family members in such a way that the net taxable income works out to Rs. 12.5 lacs per member (assuming 4).

This way the tax bracket gets shifted from 30% to 20%, clear saving of 10%

2. Expenses a trader can claim:

All the expenses directly related to the trading business can be claimed.

i) Rent Expense: If one has an office on rented premises, rent paid is a valid expense. However, you should have the rent receipts & rent agreement as valid proof.

97% of retailers buy options and lose money.

But, you can buy options:

• At the right time
• For BTST
• When premiums are too low

The difference? Understanding how they work.

Here's how you can buy options if you're a beginner:

Collaborated with @AdityaTodmal

1/ Basic knowledge of Technicals:

Option buying is about capturing the momentum, hence sound knowledge of technical analysis is required.

Without any knowledge, if one is buying an option purely because he/she feels market will rise/fall is equivalent to buying lottery tickets.

2/ Technical Analysis knowledge:

The analysis could involve usage of pure price action or indicators or a mix of both to capture momentum.

Getting the direction right is very crucial, however along with the direction the timing is equally important.

3/ Basics of CE & PE:

Option holders can buy or sell a security at a predetermined price using contingent financial derivatives called options.

In return for such access, option purchasers charge a small amount referred to as a premium to such sellers.

4/ Why CE & PE options are purchased:

CE is an abbrevation for Call Option and PE for Put option.

The CE buyer benefits every time the price of the underlying goes up.

Polar opposite is the PE option, as a PE option buyer benefits every time the price of the underlying falls.

Options trading is luring a lot of inexperienced traders who are looking for supernormal gains.

However, most of them end up losing money as they aren't familiar with the basics yet.

8 basics you must know before placing your next trade 🧵:

Collaborated with @AdityaTodmal

1/ Option Premium consists of two things:

i) Intrinsic value which represents how much money the option would be worth if it were to expire right now.

ii) Time value represents the premium you pay since the option does not expire right now.

2/ Intrinsic value:

•It is the difference between the strike price and the asset's current market price when the difference is positive.

•Intrinsic value for ITM calls> 0.

•Positive payoff for the buyer.

3/ Example of identifying ITM options:

4/ Time value aka Theta:

• Theta represents the time value decline of an options contract.

•Time value is the additional amount over & above Intrinsic value.

•Time value on an option with 20 days to expiry > Time value on an option with 2 days to expiry.

Some underrated websites for investing research & analysis👇

1. https://t.co/lxen3s2wyP
2. https://t.co/WZfcE248ss
3.

Screeners helps trader in saving lot of time in filtering best stocks out of 5000+ listed stocks.

Here is the list of top 7 Free Strategy and its respective screeners that I use:

Also, last screener is my favorite to pick early momentum stocks.

1/ Golden Crossover:

Golden Crossover of 20 EMA above 200 EMA is a good strategy used by the trader. This screener will help you in identifying stocks that has given golden

2/ CCI Momentum:

CCI is a good indicator to find out stocks that are bullish and are in momentum. I had already shared a thread on the same.

This screener will help in identifying stocks for which CCI has crossed above

3/ Bullish Engulfing:

Bullish Divergence is a setup used by contrarian traders.
This screener will help in identifying stocks in which bullish divergence is

4/ Bearish Engulfing:

Bearish Divergence is a setup used by traders to take contra trades.
This screener will help in identifying stocks in which bearish divergence is

#FreeTip If u r not used to any other adv strategies, just try this simple technique;
1) Mark PDL,PDH,PWH,PWL,PMH, PML.
2) Trade only at these levels based on price action. Either price will reverse at these levels or break.
3) Don’t trade at any other zone.

A thread of strength in the market.

An analysis which I did during Covid crash with @MashraniVivek on which sectors and stocks were strong, and we did pick pharma, chemical early cycle. Though we do not know where market is heading, doing such exercise always helps to find

strength when market bottoms. Of course, it requires much more reading and conviction building and hence should be taken only as a starting point. Here is how this list has been generated
1. Pick top 500 companies
2. Find list of companies which have fallen < 10% in last 3 months

Totally 61 out of 500 stocks.
This is how the sectors come up.
✍️Auto and Capital Goods stand out
✍️Do not ignore defence for sheer count as there are few companies in sector
✍️Next pocket looks like few beaten down sectors/stocks where may be value is emerging - FMCG, Pharma

List of stocks - Auto tops the list followed by capital goods, bank and financial, pharma and defense. Disc: I am biased towards auto n financials (keeping FII selling risk aside). Also, this is still a watchlist activity and I am not acting on it except being

invested in few auto n banking names. Please do your own due diligence. I am not a registered investment advisor and this is not a recommendation. Follow @ScientificInve6 and our Youtube channel for more such