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Overthinking - The art of creating problems which weren't even there.

Thread on How Over-analysis leads to decision Paralysis-

 What is Analysis paralysis?

In simple terms, analysis paralysis is a person's tendency to over-analyze or over-think upon a decision to such an extent that he/she fails to make a choice resulting in a paralyzed state of inaction.
How a retail trader trades-

A trader named Rahul, He know all the basics of markets, He also has made a system which gives signals on nifty, he has also encorporated good Risk management and Position sizing into his system.
One day he gets a signal to buy Nifty at 13500 with stop at 13450, he wanted to take the trade, but he wanted to get sure that the trade he has take should be a winner.

So he says just let me check the RSI if its above this level I will buy , he checks it and it was above his
level, then again he wants to check another indicator named MACD, he wanted to get sure man, Now he do the most intelligent thing to get sure he gets right.

He goes to twitter and ask his twitter Friend Trader knight he ask him that should I buy nifty at 13500,
Trader knight says nifty is already at 13550 , Rahul says in order to be sure he lost his trade.

So, this is story of many Traders out their.

How to get rid of this Analysis Paralysis-

1. You want to get right on every trade.
This is the biggest problem because of which you are going into this loop of checking all the boxes which weren't even in your list.

Ask yourself why you want to be right every time?

Even when you know you can make big money even when you are right 30-40% of the time.
Whenever we have a setup, the first thing we can start telling to ourselves is that “this is going to be a losing trade and I am going to get stopped out on this” . We EXPECT to lose on this trade but we don’t HOPE to.
There is a difference between expecting and hoping. We HOPE to win on this trade but we don’t expect to. When we lose, we are ok as we expect and prepare for it.

When we do win, we give a pat on our shoulder since we expected to lose. Tomorrow we will start all over again
– again expect to lose but hope to win.

Think about it, only you have the answer to this problem.

2. KISS- Keep it simple stupid, Its not necessary that only a complex system will make money , simple systems are less prone to the analysis paralysis problem.
3. You don’t have much experience (if you are a dicretionary trader) or you have not backtested your strategy, because of which you may face this analysis paralysis problem.

4. You are afraid of losing money, this is one of the biggest reason traders have this analysis paralysis
There could be many reasons you are fearing losing-
1. You are trading with scared money.
2. You are trading too big.

Thanks for reading till here.

Cheers,

TRADER KNIGHT

More from Trader knight

Trader knight
Trader knight
@Traderknight007
A thread on SCALING IN - OUT METHOD -


What is scaling in - out?

1. Scaling in is adding on to the positions when they move in our favor (Pyramiding).

2. Scaling - out is exiting the portion of the position when the trade moves in our favor.

I have explained about pyramiding in previous tweets.

// Why use scaling out instead of exiting all position at once ?

When you are using ALL - out method where you exit positions at once, mostly you use wider Trail SL as you want to capture big moves and exit all when trail sl hits.

The problem with this method is that either you make too big or many times your medium size winners turns out to become Scratch trades.

So, when we use the scaling out method, we are trying to capture most of our medium size trades , so that they do not turn into scratch trades.

// How to use scaling out method -

Say we have to got a signal to enter in a trade, and we have to buy 1200 qty according to our Position sizing.

So, we have to divide this 1200 qty into parts, how much? It depends on you.

We can divide into 3 parts, each part 400 qty.
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Trader knight
Trader knight
@Traderknight007
A mega thread, this contains some of my popular threads which may help you in your trading.

Thanks for reading :)


Pyramiding


Don't change your trading


Trendlines


Scaling in-out
TECHNICALS , TRADING1 , TA NOTES
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Trader knight
Trader knight
@Traderknight007
FEAR - It’s the re-experience of failure in advance.

Many traders face the issue of Not entering in trades because of fear.

A thread on How to pull the trigger when the opportunity knocks.


Lets First start from knowing the cause of this "FEAR" of pulling the trigger.

A traders goes through many phases before becoming Profitable.

The first phase is the " APUN HI BHAGWAN HAI" phase-

When we first begin Trading, we don’t know any concepts, we don’t know about the risks , the dangers.

So we start trading, and like most guys by beginners luck we start making good, we start to calculate how much money we will make in next 1yr, 5 yrs, Greed start to Hop in.


We get introduced to Various instruments, F&O, LEVERAGE.

We take big positions as we don’t have any FEAR cause we haven't seen those bad phases yet.

Now we get the Big blow, account down -50%, or in many cases wiped out.

The first phase ends here.


Now we know How the market can kick our ass, we now know the risk that comes with those big positions.

"THE LEARNING PHASE"-

Now we know that we were just lucky initially and now we have to learn why we get those losses, so we start learning concepts , fundamental, Technicals.
TRADING , LIFE
Trader knight
Trader knight
@Traderknight007
Breakout Trading 101, All you really need to know. 👇
https://t.co/DhDE4H1Oiz
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Trader knight
Trader knight
@Traderknight007
How position sizing can affect your trading performance-

Assuming that you are trading a Trend-following system with Big RR and low win-rate.

For example, assume that you risk one percent per trade on a 100,000 account
and you have 20 straight losses.

That one percent is of your remaining equity and at the end of 20 losses, you would be down to 81,790.60.

Now if you got a 30R winner and you are risking one percent of your balance of 81,790.60, your new equity would be 106,327.9,


You’ve had 20 losses and one winner though you are still up 10Rplus your equity is up by 6.3R percent.

Now, let’s say you risk five percent per trade on your balance. At the end of 20 straight losses, you would be down to 35,772.89 or down 64 percent.


If you risk five percent on this amount and get a 30R winner, you would be up to 89,621.48. You are up 10R, but because of your position sizing, your equity is still down over 10 percent.

#positionsizing
#Trading
#nifty50

This is why position sizing is the most important factor in trading if you get it right and you have an edge, you will do good.

Thanks for reading till here.
@AnandableAnand @jitendrajain @quatltd @sohamtweet
TRADING

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Here's some details... Read on.

...it took me another 5 minutes to get qualified for options.

If I share a sign up I get "free shares" and I can share as much as I want up to 500$ worth.

The main UI has a prepopulated "list" of stocks/crypto to watch and links to news.


Clicking a stock opens a "trade" button that looks like this.

Notice options is first, buy second.

Options took me to an approval process (which took about a minute) and now away I go trading Baba options.


Buying stock looks like this. It emphasizes fractional shares.
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Jig's Patel
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@jigspatel1988
Thread on Short straddle with adjustments:

Short straddle is non-directional strategy

Selling same strike price CALL/PUT option same underlying with same expiry.

Nifty Spot at 14353, So you can sell 14350 CE as well 14350 PE of 14 Jan. Expiry.

(1/n)

*RETWEET for max response

Bullish short straddle: Selling 14400 CE and 14400 PE of same expiry.

Bearish short straddle: Selling 14250 CE and 14250 PE of same expiry.

You can sell straddle as per your market view.

If you are natural view sell CE and PE at ATM strike.

(2/n)

Short straddle has limited profit potential (only premium) and unlimited risk without adjustment.

In Example, Short straddle of 14350, Breakeven is (14131.0-14569.0), need 1.7Lac Margin to sell straddle.
Maximum profit: 16k and Loss: Unlimited, Winning probability: 50%

(3/n)


If market staying near at 14350 then win. Probability increase slowly. Rewards also increase slowly.

Volatility(IV) is also play important role in selling straddle, Like If IV increase so straddle premium increase and IV cool off so premium casually comes down.

(4/n)

Short straddle adjustment:
https://t.co/59Lr64kEtK way to limit the overnight risk.
Convert short straddle in Ironfly, its nothing we have to add long strangle in short straddle it become Ironfly. It gives the good Risk Rewards.

(5/n)
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Fake chats claiming to be from the Irish African community are being disseminated by the far right in order to suggest that violence is imminent from #BLM supporters. This is straight out of the QAnon and Proud Boys playbook. Spread the word. Protest safely. #georgenkencho


There is co-ordination across the far right in Ireland now to stir both left and right in the hopes of creating a race war. Think critically! Fascists see the tragic killing of #georgenkencho, the grief of his community and pending investigation as a flashpoint for action.


Across Telegram, Twitter and Facebook disinformation is being peddled on the back of these tragic events. From false photographs to the tactics ofwhite supremacy, the far right is clumsily trying to drive hate against minority groups and figureheads.


Declan Ganley’s Burkean group and the incel wing of National Party (Gearóid Murphy, Mick O’Keeffe & Co.) as well as all the usuals are concerted in their efforts to demonstrate their white supremacist cred. The quiet parts are today being said out loud.


The best thing you can do is challenge disinformation and report posts where engagement isn’t appropriate. Many of these are blatantly racist posts designed to drive recruitment to NP and other Nationalist groups. By all means protest but stay safe.
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Val Katayev
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@ValKatayev
A former CIA math genius built a quantitative trading fund that earned more than $100 BILLION for investors.

At 66% return/yr, his track record destroys that of Warren Buffet, George Soros, Carl Icahn, and every investor who ever lived.

The Smartest Billionaire in Finance:


1/28
If you'd have put $100 into Jim Simons' Medallion Fund in 1988, it would be $400M+ today.

By contrast,

$100 in the S&P 500 in 1988, would be $2,000 in 2022. (roughly)

Let that sink in.

2/28
Jim Simons's Medallion fund has had unreasonably high annual returns of 66% across 30 years.

For comparison, Buffet clocked in at about 20%/yr.

Many funds don't make that in a lifetime.

3/28
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They make so much money for their investors that they charge 44% in management fees.

The industry standard is 20%.


4/28
It uses math calculations to decide the bulk of its trades, & none of the market trends apply to how it performs.

It wins by finding order in chaos.

The fund is managed by Renaissance Technologies, the parent company founded by the mathematical genius Jim Simons.
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@YMehta_
Option Trading is very difficult to master as there are so many things to understand.

Here is a master thread related that will help a beginner to understand about Options Trading.

A complete course worth Rs 50K for free.

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Even a beginner can start trading in option selling with capital as low as Rs 1 Lakh.

What are the techniques one can use and how to mitigate the infinite loss risk is shared in this
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Thread on
"Intraday Banknifty Strangle based on OI data"

(System already shared, today just share few examples)
(1/n)

-Trade timing after 9:45

-Check Banknifty change in OI data at 9:45, and identify the highest OI built up in call side and put side

-We will sell both strikes with combined premium as SL on both legs.
(2/n)

28th June 2021

BN open-35440
At 9:45 trading at 35350
Highest OI in call side at 35500 CE and 35000 at put side
Strike selection 35500 CE- 35000 PE
(3/n)


29th June 2021

BN open-35323

At 9:45 trading at 35112

Highest OI in call side at 35300 CE and 35000 at put side

Strike selection 35300 CE (232) - 35000 PE (150) Combined premium 382 , Both legs SL 382
(4/n)


30th June 2021

BN open-35030

At 9:45 trading at 35002

Highest OI in call side at 35000 CE and 35000 at put side

Strike selection 35000 CE(176)- 35000 PE(213) Combined premium 389 , Both legs SL 389
(5/n)
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MAHARAANI TARARANI: THE QUEEN OF MARATHAS

Rani Tarabai was the brave daughter-in-law of Chhatrapati Shivaji and one of the greatest medieval Monarchs India ever had.
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Sambhaji's wife and son Shahu were taken prisoners to the Mughal court. During the same battle, Shivaji's second son Rajaram(Tarabai's husband) , who was the heir to the throne now, managed to escape using a disguise. He made his way to the Gingee Fort in Tamil Nadu.


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Sculpture of Bhagwan Shiva as the destroyer of the Asura Andhaka - Cave 29,Ellora caves

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Once Parvathi & Shiva were relaxing in the pleasant gardens of Mount Mandhara.


Bhagwan Shiva sat down there to enjoy the happiness.Parvati closed the eyes of Shiva playfully & darkness covered the whole universe.Parvati was perplexed & her palms were wet with perspiration.A few drops of her sweat mixed with sweat from Shiva’s body& fell to the ground.

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