Note: Part of newsletter sent to my subscribers today. If you need such newsletters please subscribe here.

Since a lot of time Nifty is doing nothing. All my customers of the conservative option course trading the strategy 1 – the non directional trade would have made good profits.

But there are indicators that now any day Nifty may move. Which direction we do not know – but there can be a move. I know there are lot of you who DO NOT trade with the hedge – I recommend for next 30 days be 100% hedged. Those who hedge always need not worry.

If GST bill is passed – Nifty is headed up.

But I think 7600-7700 is a good support for Nifty. (That does not mean you buy a Future – I do not give suggestions so that you trade without research based on what I say in this blog. Please do your own research before taking an investing decision.) You can buy Nifty BeES though, hold them till you make 5-6% profits. Well you can also switch some of your debt mutual funds holdings into equity. But only some of it. Read this article for more information.

Which Stock To Trade?

ITC Ltd. is looking very attractive at 313. Start accumulating the stock. Some now at around 300, then at 270, then at 243 (probably it will not go there). It is going down because GST will severely effect taxes paid by ITC. But we all know if that takes place, ITC will increase the price of their products especially cigarettes. And humans will keep inhaling cigarettes – it does not matter what the price is – habits don’t die easy. 🙂 And ITC will once again bounce back.

If you have cash trade the conservative stock strategy on ITC.

What Will Happen to India VIX:

It closed today at 15.87. Still good for strategy 1. But if you have cash read below:

If FED does a rate hike we may see some correction on worries over FIIs taking their money out from the stock markets. But if you know strategy 1 who cares? The Fed, holds its next policy meeting on Dec 15-16. So I assume VIX will again increase and will be at a good high on Dec 14th (Next Monday). If you have free cash trade strategy 1 on Monday or Tuesday.

You can even trade this Friday, 11th December, 2015. Since we have 2 days off weekend if there is not much increase in VIX then you can get the benefit Theta depreciation during holidays. Remember that Theta also depreciates during days stock markets are closed. 2 days benefit is good if VIX does not swell. If nothing it pays off your brokerages.

What may happen short term to Nifty?

There is a strong signal that FED will hike rate by 0.25%. But if nothing major happens to Nifty and GST bill is passed, Nifty is then headed for 8300-8500. The only issue is the FED reaction – but there are a lot of signs that markets will not panic like they did a couple of years back.

Since the signals of rate hike is very strong I think Nifty will factor it end this week itself.

Remember VIX cannot factor anything before the news except going up, so it will only increase. And even if it does not – it will fall after the news.

Good opportunity – make money. 🙂

Thanks for being my subscriber. More information on my Conservative Options Course is here:

http://www.theoptioncourse.com/learn-how-to-trade-options-for-monthly-income/

Disclaimer: This post is for educational purpose only. If following any advice written above please first do your own research. Stock market investment are subject to market risk so please have a proper money risk management plan.

Some of my visitors ask for stock market advice for free. I help as much as I can, but some emails are hilarious and some impossible. Read this article to know some real interesting people. There is a lesson too.

Now that my site www.TheOptionCourse.com is getting somewhat popular (I still feel a lot more needs to be done), I get regular emails for help.

Let me be very frank. No person on this earth can know everything. I am a human too. Its not possible that I know everything – so its quite obvious that some emails goes into “Ask Me Anything” folder of my account for further research and later reply. My apologies if you do not get a quick reply.

However whatever I know I do try to reply quick. Please also understand that my customers are my first priority and if I find time I do reply the emails asking help for free.

But at the end of the day – I am the same human being as YOU. I have a family, a consulting job and of course this site which keeps me super busy. And I like that.

However sometimes I get strange messages where people take me for granted.

This person claims to be 51 (well could be true). Has 1 lakh in his trading account. I am sure he has saved some money, probably 10x of the cash in trading account – but wants help from me for free. Its not clear what he wants. Does he want me to give him the strategies for free or he needs money – its not clear. And his name is NOT Manas as in some previous emails.

His first email was :

Dear Mr. Dilip Shaw,
I need Rs.50,000 per month to run my house.
And exactly after 28 months I need Rs.30 lac.
How much money I need use as capital?
I want to learn your nifty strategy whether futures or options.
Please help me.

So it looks like he is asking for the course for free. And look at his demands. 🙂

I replied back with:
Currently do you have a job?

His reply was: No.

Then I asked:
And how much cash you have in your trading account?

His reply: 1 lac

Then I did not reply as 1 lac is good to take risk with stock markets if you are slightly younger and have a steady job, but starting with 1 lac at 51 especially if you do not have a job/business is risky.

But today this person wrote something strange that I would like to share with you. Have a look at this email below (all personal information of the sender hidden as usual for privacy):

This is what was written in the email:

If you help me get my financial problem solved, I will keep your photo along with Gods in my pooja room & worship you till I die.

I am in deep problem. Off-course one who will take out of it will be nothing but God for me. Your daily worship video will be sent to by attaching to mail or if you want to see live , I will show live by web camera.

These are words of 51 year old man in huge trouble.

Really my photo along with Gods? I am alive and kicking dude and I am NOT GOD and don’t want to be one. This makes me utterly uncomfortable. Please do not write fake sentiments. That does not work in real world. Let me tell you one fact of life:

“You are the only person who can help yourself in trouble. Not your parents, not friends, not relatives, not even your kids – you are the only one who has to get yourself out of trouble.”

Others can only give you advice, but in trouble it is you who can help yourself the most – no other person on this Earth can.

When I was losing money trading I was in the same spot – wife pregnant, 1 Lakh personal loan, zero balance in bank accounts, sacked from Job, and on top of that whatever was left was taken away by tips providers. My back was against the wall, but Thank God, I turned it around. Who helped me? Of course my parents, friends chipped in with advice and my father-in-law paid for my wife’s delivery (Thank You Papa) – but that’s it – I had no other choice but to work hard and make sure the trouble goes away. And it did.

I looked for a stable job. Any job – it DID NOT matter whether I liked it or not. At that time making money was paramount. I was willing to work day and night, nothing else mattered. Beggars cant be choosers right? In 2 days I got a good job. Then with my first salary I bought books. Did not waste time reading them. Like I was reading books while traveling to office, after coming back from office till late in the night.

Of course I knew this that if I am losing money, there are others losing money too and so I made this website to help the retail traders trade to make a profit. But then I hope you understand I have my limitations too.

If you think someone from the skies will come and take all your troubles away and do nothing – hell you will get into more trouble.

At at 51 if someone thinks like this then its is quite surprising.

This person wants help but has set a time limit for me to reply back. How interesting is that?

The email says this:

I am planning to adopt delta neutral strategy trading in Nifty options from next series. But instead of shorting any option and hedging it by buying the same option(of course different strike price), I am planning to short both put and call options at a far away price i.e. if Nifty at 8300 shorting put of 7900 and call of 8700. Also readjusting my positions according to movement of Nifty to earn full or maximum premium at or near expiry. Please inform whether I am on right track or do I have to take some extra precautions. Please reply before 30th October(start of November series) Thanks in advance.

See how he is to asking me to reply back before 30th October. He is not my customer.

Here is another email, though this is more to do with “you are helping that’s fine – but I need more”. See this email:

It says:

Dilipji sometimes you send regarding vix down or up and your strategy worked for 3 to 6% like that. Its alright but you did not told about which call or put options buy rate and sell rate please next time mention the options rate also.

So basically I kick my service good bye and help this person make money for free. When I requested him to take my course – there was no reply. Basically this person does not want to work hard and just wait for my tips to make money for free. I am sure if I do that he will next ask me to send him SMS on time – again for free. 🙂

If you are not willing to learn – no one can help you. No tip provider can ever make you rich.

This person is an Option Teacher somewhere in Mumbai. So ideally this person should know everything on options since he is teaching options. This is the email he wrote to me:

Hi Dilip,
Can you help me with regards to the below query, also can u share your contact details as I wanna learn more about Options.
With regards to Option I have a question on below mentioned chart.
In this chart Nifty 8300 call option on 1st of June shows settle price of 555.05, at this time there is no contract traded and also open interest is zero.
Question is how exchange has arrived with this price when there is no one trading.

Ok the question is good but silly if an option teacher is asking. Even if not traded an option will have some value. Ask and bid are based on the option premium provided by the market makers. So an option will have some value even if no one is trading. He has also NEVER traded options by the way. 🙂 He called me and told me that.

Here are some other interesting emails I would like to share. I am not attaching a screen-shot as it is not required.

I am 63 year old and retired from Govt. Service in the post of Accounts Officer. I have started trading since 2012 and lost nearly above 40,00,000/-( Forty lakhs) My retirement benefits have gone with in the period of 3 years. Please help me in recovering my loss at least 20% or 25%.

Another email:

Sir,
For a long time from 2005 i am trading in this market and lost RS 12 Lakh in this market by trading option and futures. I have already tried for more than 24 tips provider at last i had faced loss with them ultimately. One day i saw your advertisement on a website and replied. I am watching your mails for more than two months but i could not understand the way by which i can get back my money back which i have lost in this market.

I have only Rs 2500/- in my trading account but having holding of stocks valued RS 130,000/-and for this i can get exposure of the same amount for just 5 trading days only for a single trade. My account is with India Infoline and Brockrage is Rs. 80 for option per lot one side and 5 paisa intraday RS 150 for future one side. Now please suggest me is it possible to trade any option strategies in this kind of situation ? I have stopped trading since six months as i have lost my confidence and guts to loss.

I am 55 year old with practically small savings and on the verge of retirement. Positive thing is that my children are well settled and can look after themselves and can provide only basic necessities of my life. I have got a sickly wife whose medical expenses are 2.5 lacs per annum and which is my 50% of my annual income.

I can offer a risk money of 1 lac for building my retirement corpus which is 3 years away from now. I am interested in options trading and had been learning a lot about them, but I had not taken the plunge. Suggest how you can help me and also approximately how much retirement corpus I can build in 3 years time with 1lac I am going to invest now. Please explain to me in detail. I may be able to spend at least 2 hours for trading every day. Thanking You.

I am sorry if this email hurts anyone – but what I am trying to say through this article is “You Are The Only One Who Can Help Yourself In Trouble”. So just get up and learn to work hard. There is no free help. You either pay money or your pay through your time. Its your choice – but hard work you must do.

Note: Extract from my newsletter sent yesterday. Please register your email here if you like to receive such newsletters. You will also receive a free 5 days course on options.

Yesterday (30-Nov-2015) evening I had emailed my subscribers this:

INDIA VIX today closed at 16.43.

It could increase before the announcement of RBI Policy tomorrow at 11 am sharp.

I assume it will drop after that.

What can you trade tomorrow?

If you have taken my course trade Strategy 1 BEFORE the announcement is made at 11 am – NOT after.

If you are already in Strategy 1 – please see if you are getting reasonable profits at around 1 pm. If yes close your positions and book profits. VIX would have dropped and index stable. Great time to take profits out.

Enter again when VIX increases. Looks like 17 is the best to enter. But there is no need to keep waiting. There are no major news at least for the next 15-20 days – so it looks like VIX will be more or less in a range 15-17. So any day you see a spike, enter Strategy 1 again.

If you are an Intraday trader – SELL ATM (at the money) options (both calls and puts at 9.30 am) and book profits end of day or if Nifty moves 1% from the time the options were sold (this is actually stop-loss in profits). Do not sell after 11 am tomorrow.

A 1% move will NOT damage the positions – VIX drop means you will still be in profits.

========== End of Email ==========

Why I asked to sell options before 11 am today?

The reason is this that VIX will be high before the announcement is made and after that it will fall. Sellers can make quick profits trading Intraday.

As you can see VIX today opened at 16.43 – same as yesterdays close – but at the time of writing has dropped significantly.

All Intraday option buyers will lose money today as I do not expect huge movement after this news.

And remember – options buyers, especially the short-term ones or Intraday traders, get very active on these days as they expect huge movements. When nothing happens they close their positions in losses. Sometimes even when the move comes – they still lose money because of the drop in Volatility which leaves them confused as to why they lost money even when Nifty moved in their direction.

Well now you know why. 🙂

Why There Will Not Be Huge Movement?

That is because what happened was expected anyway and now the traders DO NOT know whether to buy or to sell and that could be stocks/options/futures whatever. In situations like these there is going to be a balance and markets will not go anywhere ensuring losses for the buyers.

In today’s case the markets expected no rate cut and exactly that happened. Reserve Bank Governor Raghuram Rajan held repo rate steady at 6.75 per cent in his monetary policy announcement today. When markets expects something, it factors the movement much BEFORE the news is out probably a couple of days before. So markets move huge ONLY if what they expected did NOT happen or something very unexpected happens.

For example if RBI would have decreased rates, then markets would be flying high now. Had it increased rates, markets would have nose-dived. But since the news met expectations nothing major happened – except the drop in volatility.

What is INDIA VIX now?

When I started writing this article at 11 am it was 15.97 (-2.80%) down from yesterday’s close.

Now at 11.45 am it is 15.88 (-3.35%) down from yesterday’s close.

The fall may continue today so the best time to book profits is after 1 pm.

Update at 1.50 pm: Like I said it will keep dropping at 1.50 pm INDIA VIX is at 15.70 (-4.44%) since yesterday’s close. Nifty also did not show much movement for the day – just 10 points is virtually NO movement. Book Profits NOW and close your Intraday positions. If making reasonable profits in strategy 1 close it too. Do not wait more.

We will wait for another opportunity to enter markets. Good traders are NEVER always in the markets. Enter when there is an opportunity and exit with profits as soon as you can.

Update at 3.30 pm: INDIA VIX closed today at 15.63 which is -0.80 from previous day’s close or -4.87% down from yesterday. Nifty also did not move much – closed at 7954.90 or 19.65 (+0.25%) points up from yesterday close.

I think a lot of you would have booked good profits.

Build Wealth Slowly Should be Your Mantra.

Enjoy the profits.

I hope you are enjoying my newsletters and profits too. 🙂

All The Best.

Note: The strategy you will read here is well explained in another PDF file. You can get this strategy for free if you open a brokerage account account under me in ZERODHA. To do that you have to register an account now by clicking here. Once your account is opened just contact me. I will send you the strategy. You can see some real trades and testimonials here.

Please Teach Me To Make Rs. 2000 Daily Trading Intraday Strategy

This converts to 2-3% everyday. Now for the time being forget stock markets. Think about any business that makes 2-3% everyday or a 100% return every quarter? Does any business comes to your mind? No, Nada, Nothing. There is no business that can generate that kind of returns. If there was some business like that – all other businesses would simply not exist.

However making 2-3% per month from trading options is possible if not more. This in my view is significant if you can compound accumulated profits month after month to make more money. The idea is not to withdraw profits and re-invest the profits back in to trading conservatively and keep making profits. In my options trading course I teach conservative strategies that can help you make 2-3% a month from trading. Click here to read more about the course.

100% A Month Return Is An Impossible Dream That Can Be Sold Easily

This is an impossible dream which traders love to dream. They day dream something like this – “If I can make Rs. 2000 from one lakh everyday, I can invest 10 lakhs and make Rs. 20,000/- everyday which is more than 4 lakhs a month. Enough for a comfortable living”. Their day-dreaming does not end there. They then dream of pulling crores from friends and relatives even from banks and make crores every year.

Yep I am not lying. My website gets traffic for “how to make crores from 1 lakh in stock markets in 1 year?” and they are directed to this page – “How to Make Crores from the Stock Markets“. LOL

Hell they do not even know why they need so much money in the first place. 🙂 But dream they do. Sadly this dream costs them dearly. How?

You see all stock market advisory companies, Intraday tip providers, options & futures tip providing companies and others in similar business know this very well and are able to sell these people their dreams. Hell even I am a victim. I wasted Rs.40,000 paying money to various tip providers and lost close to Rs.60,000 trading their tips. Thanks to them I turned to books, but that’s a different story.

But fact is its very easy to sell a dream. Just Google “Intraday tips” or “stock tips” or “option tips” and see the results page. You will see dreams being sold. Advertisements like “over 10% monthly returns”, “100% Percent Returns”, “50K to 2 Lakhs”, “Over 1000% Returns”, “100% secure tips”, “Make Rs.5000 Daily”, “100% Accurate Analysis” and lots more will pop up.

Tell me now, do you think its possible? If no then why do you buy such dreams? Let me tell you in a very blunt language – making money is hard – you cannot make it rich by getting tips from someone. You have to walk your own path, that’s why God has given you brains. If making Rs. 2000/- daily is possible just by paying someone 2-3k a month and 1 lakh/50000 in trading account then why do people study in costly schools and colleges? Hell borrow 1 lakh from your parents, open a trading account, and pay a tip provider 2k a month and laugh your way to banks. Life ain’t that easy. Is that even remotely possible? In fact Thank God its not possible else the world would had collapsed. No one would work. All would wait for that next tip to get rich. It would be a strange world.

You Mean Intraday Trading Does Not Work?

No, I never said that. I only said if you are thinking tips providers will make you money giving Intraday tips then that will NOT work. You can of course work hard and become an expert day trader. There are many books written on them, you can do online research or try your own strategies to try your hand at day trading. But its only you who can help you to become an expert Intraday trader. No one else can.

When I was losing money I tried several Intraday strategies on my own. Most of it is not worth sharing but there is one that I feel may work if you try which I will reveal shortly.

Please Tell Me Good Intraday Trading Techniques

Ok. But I tried a lot of strategies. I will tell you something that may work Intraday, but you will have to practice to perfect it.

Note: What you will read below needs a lot of patience and practice. However there is an easier way to trade Intraday trading not written here. If interested to know please please contact me.

There is something known as scalping. According to Investopedia.com:

“A scalper is a type of trader that may dart in and out of a stock or other asset class dozens, or in some cases even hundreds, of times a day. The reason these individuals are so active is that they hope to reap a small profit on each trade and that these small profits will add up to big dough at the end of the day.”

In other words a trader takes lots of trades (mostly done in equity cash because of high liquidity – but it can be done in Nifty Options as well) and will try to make small profits in most of the trades. Of course the profit in terms of cash should be double that of loss. So one profitable trade means the trader can take two more trades. Like this if the trader takes 10 trades in a day and has a success rate of even 50% – he can make Rs.2000 to Rs.3000 daily from a small account.

Scalping is an art. Whether you know technical analysis or not is not important. Lots of practice, planning and patience is required to be a successful scalper. Also its a full time job. You cannot become a successful day trader with another full time job. Day trading needs your time and attention. Not monitoring your trades or leaving your monitor without stop loss in system can be disastrous.

To reduce stress, especially in western countries, there are many automated trading systems that are based on the scalping methods. Since its automated hundreds of trades can be taken in a day. And they can book profits in tenth of a second. You got the idea of how fast it can be if automated.

Of course automating trading is a costly affair. So here is how you can do scalping.

Which Stocks To Trade in Scalping and How To Trade It Intraday?

Highly liquid stocks. Here is something I tried but could not take it further as I lost interest in Scalping due to the stress.

Disclaimer: Please note that this is an advice. Please do your own research before doing real trading. Stock market investment is risky. Please paper trade before committing real money.

At around 11 when the trend got clear I used to visit http://money.rediff.com/index.html. Then click on NSE. On the right you will see the day’s top 5 gainers and losers. See this:

Then I used to open graph of top 3 gainers and losers. The idea was to pick stocks with clear trend and with high liquidity. (See there is NO technical knowledge required but BOTH my objectives are met when I am doing this. One I am trading in highly liquid stocks and two I can see the trend at least for the day). Also remember the idea was to scalp – so even a small profit would do. Of course I used to trade in only 1 stock at any given time. After 2 pm I did not trade.

Lets see today’s graph of top 3 gainers and losers. (Well this is nostalgic – I am remembering those days 🙂 )

Top 3 Gainers:

Top 3 Losers:

Ok as you can see around 11-11.30 am Hindustan Unilever Ltd. is showing a clear trend. HDFC not. Reliance Industries Ltd no. Bosch Ltd. yes. Adani Ports yes. Maruti Suzuki India Ltd. Yes.

Next I used to go to http://www.moneycontrol.com/ to read any news on the stocks showing clear trend to know why they are gaining or losing most. In the above case Hindustan Unilever Ltd., Bosch Ltd., Adani Ports, & Maruti Suzuki India Ltd.

According to news I used to pick my stock. News like being acquired by someone, or corruption charges on management, quarterly results etc have big impact at least on that day of trading. Based on how strong the news is a stock was picked. Of course its easy to understand that I used to go with the trend. For example if the news says Hindustan Unilever Ltd. profits more than expected then there is a strong possibility that the stock will not reverse direction. Or news like Maruti Suzuki sales dropped means at least for day the stock will have more sellers than buyers. You see in this trade your real threat is a whipsaw (stock reversing direction).

What Was My Profit or Loss Target?

Well my account was really small after losses. I did not want to risk too much and I was in the experiment mode, so in terms of money it was very small. In terms of percentage you can try initially with 0.5% of profits and 0.25% loss on margin blocked. This has to be maintained. Of course you can do 1% profits and 0.5% losses, choice is yours, but to succeed you must make double your losses. And both stop losses should be in system. Of course if a trade is making profit you can keep increasing stop loss (called trailing stop loss)to take out the maximum profits for the day. But again that needs to be practiced. Its an art.

If you can practice and perfect the above you can become a good scalper and Intraday trader.

How To Scale And Make Lakhs Per Month Trading Intraday

Start with a small account. Risk only Rs.3000-5000 initially. See if you are profitable doing this in 20 days of trading. If you are, double your risk or increase it Rs.10000. That way you will gain some experience and of course confidence of risking more money. If you straight away start with 1 lakh and lose 10% of it in 20 days of trading then you will not have the confidence of trading more. So start small.

Once you become successful and have proved yourself, take multiple trades a day. Remember its more about controlling your emotions than that stock’s movement itself. When a lot is at stake we tend to behave very abnormally – so you need to learn to control your emotions to become a successful Intraday or day trader and scale your profits. This can only come by practicing and hard work.

You cannot buy hard work, can you?

Conclusion:

Nifty has continued its downfall. Some people have reported stop loss in strategy 1. In that case there is no point in waiting and hoping for a recovery. See the document – if according to rule you have to go to strategy 2 then go. Stick to discipline.

If the loss is less around 10 points only – there is no need to go to strategy 2 – just close your current strategy 1 and get into a more comfortable position.

Some people are telling me that OI (open interest) is most in the 7700 Puts.

You can see OI (open interest) here:
http://www.nseindia.com/products/content/equities/equities/oi_spurts.htm
After reaching there click on “By Contracts”.

If you do not know what an open interest is then in short its the total number of open (or not closed) contracts. So basically right now (at this moment only) on the 7700 strike there are more number of open options & futures trades open than on any other strike.

But the fact is, it is AS OF NOW. This may change in 1 hour. In that case what you do? Do you close your trade and again re-enter because what open interest is telling you? This in my book not a great way to trade.

Fact is open interest does not work. When it works traders think that open interest did the trick, when it doesn’t they blame on other factors.

More open interest means the market is expecting that Nifty will not break 7700 or even if it breaks – on expiry it will be above 7700 PE.

Also note that I checked 1 hour before it was around 1 lakh+, now reduced to some 78,000+. Please bear in mind that OI will keep changing, which means basically you have to keep a tab on it. This is where I am not comfortable and rather stick to discipline.

Well frankly no one knows what will happen on Monday – a gap up or a gap down? Therefore I would rather stick to discipline than go with the open interest. The point is if it breaks 7700 then the losses will accumulate pretty fast as 7700 will become ITM (In The Money) and delta of 7700 will become greater than .50. This situation must be avoided.

Of course if you listened to me and got into a more comfortable position after the Bihar elections then I am sure stop loss is not hit and you are safe.

In that case stay put and wait. No need to panic.

Thank You: I think I got more than 100 wishes from you all on Diwali day. Really means a lot. Overwhelming Joy seeing your wishes. 🙂 Your trust on me gives a lot of satisfaction and motivation, especially in an industry where there is lack of trust on tips providers. Some messages were very interesting and some very motivating.

Thank You All once again for the lovely messages. Will upload some of them in my blog. Of course your phone no or emails will be hidden. I take confidentiality of your personal information VERY seriously.

Today on Diwali day the stock markets will open only for Muhurat Trading.

These are the timings:

5.30 pm to 6.45 pm – Equity & F&O (NSE, BSE, MCX-SX)
5.45 pm to 7.45 pm – Commodity (MCX)

Intraday positions will get automatically squared up around 6.30 pm.

Why You Should Not Trade on Muhurat Trading

My sincere advice is please do not trade on Muhurat Trading. You have just one hour and at least Intraday it does not makes sense. Plus people celebrating the occasion have a lot of things lined up for the evening – Lighting Diyas, Laxmi Puja and Burning Crackers. And of course lovely food. 😛 Obviously your minds will be there and you will not be able to trade peacefully.

So its better do not even open the trading app or your TV to look at whats happening in the markets.

But I know there are some people who will do some trade on this day as they feel its auspicious to do trading on Diwali day.

Well when investments are concerned its your knowledge that brings returns not the day or time when you are trading.

Muhurat Trading Tip 2015

Still if you are forced to trade then I would suggest start buying Sun Pharmaceutical Industries Ltd in stages like some today, some after a decline of 10% and some after a decline of 20% from here. Its looking very strong at 726.00. Its now at 52 week low as well. A very strong company. Though it is having some issues right now, they are short term and the stock will recover very fast when the management will solve those issues. The stock should give you good returns within a few months – but please do not invest a lot, and, invest in stages. If the stock goes down 10% more from here buy more. Or if the stock goes up 10-12% sell and book your profits.

Note: The stock gave a return of 10% in 45 days and I emailed my subscribers on December 28, 2015 to exit the stock when it closed at 790.85. Next day the stock opened over 801 for trading and my subscribers made a profit of more than 10% in 45 days. Please note that the profits may have come earlier, but stock markets investing should be done with proper research and proper money management rules must be followed.

Another good stock is HDFC Bank Ltd. Its looking very strong at 1050 levels. A very strong company – actually an evergreen company and a heavy weight stock. Please note that there can be issues with this company in future like NPA (Non-performing asset is defined as a credit facility in respect of which the interest and/or installment of Bond finance principal has remained ‘past due’ for a specified period of time. NPA is used by financial institutions that refer to loans that are in jeopardy of default the so called NPL), bad loans (loans that cannot be recovered), some management issues etc, but I am sure with time this stock will prove to be a great stock to invest therefore invest in stages not at one go.

Update on 07-Nov-2018 (Diwali Day) – Let us see how this stock has performed over the last three years:

HDFC Bank Nov 2015 – Nov 2018

Closed at 1946.55 on 6-Nov-2018 – this is a return of ((1947-1050)/1050)*100 = 85.43% in just three years.

HDFC Bank 06-Nov-2018

Hope you made good money in this stock. 🙂

Here is Wishing You All and Your Family A Very Happy Diwali 2015, and a Prosperous New Year.

TheOptionCourse Muhurat Trading Happy Diwali 2015

Disclaimer: Stock market investment is subject to market risk so please do through research yourself before investing in any stock even if the recommendation is coming from me or anyone else. This investment is proposed for a long term and not short term, therefore please invest with the money which you will not need for at least 1 year.

Here are some of the Happy Diwali 2015 Wishes from my customers. Thank You so Much for believing in me and wishing me. I hope your next Diwali is even brighter. (Please note that the signal is missing in images because my mobile got corrupted and these are snapshot from my mobile with a non-working SIM. I had changed my mobile by then.)

This email was sent to my subscribers on NOVEMBER 9, 2015. If you want to receive such newsletters please subscribe at the bottom of this page.

Please refer my email dated NOVEMBER 2, 2015 titled: Bihar Election What To Trade. You can read it here.

With respect to the Bihar elections I kept sending newsletters as a reminder to help my paid subscribers book profits.

This email was sent on NOVEMBER 6, 2015:

Sorry for sending this email late. Was really busy. 🙁

Looks like VIX has started to fall because exit poll results are out. Its 19.28 now.

Those who are aggressive traders can sell ATM options now. On Monday VIX will surely drop more than 9% so you can immediately book profits and exit. Only issue will be a big move. For that you can buy some OTM options.

People who have done my course, hope you have entered Strategy 1. If not, do it today before markets close.

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Then on NOVEMBER 7, 2015, I sent a newsletter again as a reminder:

(This email is for my paid customers only.)

If you are in strategy 1 read this:

The VIX will drop – but movement may come so here is the trick to make a profit:

By 9.30 exit the trade in profits (whatever it is) and get into new strategy 1 with a more comfortable position.

You can get into a new one by 1 pm when Nifty will have moved and will be where it is suppose to be for normal trading.

Hope it helps.

Enjoy the Profits and send testimonials.

Many Thanks For Being My Customer and/or Subscriber.

I will send reminder again on Monday morning.

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Then yesterday I sent this newsletter again so that they remember to book profits:

If you are on strategy 1 remember that VIX will drop and it’s better to get out early morning to take benefit if premiums drop. You may re-enter later in the day or as written in the course.

Basically I do not want to take losses in hope of better return which I am getting now. Even though my profits are small – it’s at least a profit – better to take it now rather than take a loss later.

The problem is there can be movement and since it looks like NDA has lost in Bihar – we can only guess that Nifty will open Gap down and MAY continue to keep going down through the day.

Well again this is a calculated guess – it may well go wrong. But this one is for sure VIX will drop so benefit from that and later get into a more comfortable position.

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I was correct on one thing and wrong on another.

I was correct here:

“On 6th November I had written that “Looks like VIX started to fall because exit poll results are out. Its 19.28 now. Those who are aggressive traders can sell ATM options now. On Monday VIX will surely drop more than 9% so you can immediately book profits and exit.”

Well at the time of writing this NDIA VIX is 17.46 – a 2.01 points drop from previous close which is -10.32% drop.

And wrong here in my newsletter sent yesterday NOVEMBER 8, 2015:

“The problem is there can be movement and since it looks like NDA has lost in Bihar – we can only guess that Nifty will open Gap down and MAY continue to keep going down through the day.”

Well it looks like Nifty is actually recovering. Its ok as VIX is our main friend/enemy, not movement. VIX dropped and we made a profit that’s what matters to us.

Hope you have booked profit. If not please do so and enter into a new strategy 1. VIX is still good at 17+. The option premiums are fine.

Those who took my course recently are also reporting profits. Here is one WhatsApp message I got today morning by one of my paid subscribers. Well I am in hurry to send this newsletter so will post the screen-shot later in some other post.

“GM Sir. I had received your strategy on 4th Nov. Read it. Did 1 lot trade on 5th Nov and added 40 lots on Friday (6th Nov). Margin used was 15 Lakhs. As we pay only SPAN margin. Squared up today at 10.16 am for a profit of Rs. 39,000/-. Thank You Sir.”

That’s a profit of 2.6% in 3 days.

He paid only 5000/- to get the course and in less than 3 days makes 39,000/-. This is the kind of results I want to see. Its nice to read testimonials like these really.

I repeat again: VIX has dropped as predicted and the strategy 1 must be in profits. Please book profits whatever you are making and get into new and comfortable strategy 1.
Hope you are enjoying my newsletters.

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http://www.theoptioncourse.com/dilip-shaw-course-testimonial-page-2/
And here:
http://www.theoptioncourse.com/dilip-shaw-course-testimonials-page-3/
And here:
http://www.theoptioncourse.com/what-people-say-just-after-taking-my-course/

And 50+ testimonials are still waiting in queue 🙂 . Frankly I do not find time to add them. 🙂 🙂

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Work hard and invest in knowledge. That’s the only way to create wealth trading options. Thank You.

People who are smart traders will always keep making money irrespective of what happens to the markets.

After almost 1 year of offering the option course, I have found that some of my customers are smarter than me. I have no problems admitting that. This in fact is quite natural. Students doing better than their teachers is very normal. One reason could be my conservative nature that you can see in the below chat as well. 🙂 After suffering huge losses initially I do not want to take any more chances.

Some of the smart traders do my course and end up making more than 3% per trade (not per month) especially from the directional strategy. These trades can last for about a week or so. If done correctly imagine the kind of returns it can make. I feel very happy when a smart trader emails me their success. 🙂

Look at the WhastApp message I got from a client who did my course early October, 2015:

Testimonial by Mr. Krishna – Results may vary for users

When asked about the trade, this is what he said in his email:

Hello Dilip,

After a long time, I had a profitable trade with low pressure on my mind, took trade as per the directional strategy from your course.

I had taken similar position couple of months back but had lost money. What I learned was when the expiry is near; it may not make sense to take the position as it had lead to losses.

The above was the precursor for taking the current position, taken on 20th October, details as under:
* Bought one lot of November Nifty Future @8,317.
* Rest of the Details of the Trade Edited as this will go in public domain and is part of my course *

I squared off my positions today (i.e. on 30th of October):
* Nifty future: 8083 – 8317 = -234 points; loss of Rs.17,550/-
* Rest of the Details of the Trade Edited as this will go in public domain and is part of my course – however he made profit here in options, beating the losses in Futures * 🙂

Summing up both credits, the overall profit from this trade is Rs.3,375/-. 60000 INR was blocked by the broker for this trade. I made a neat profit of 5.6%.

This was probably one of the best trades in the whole of my 4 years of trading career. Very low pressure about potential loss and made decent profits.

Thank you for the course and the constant guidance and support.

Wish you good luck!

Regards,
Krishna

Trading Without Stress is Important to be a Smart Trader

You know what makes me more happy in the above email? This sentence – “This was probably one of the best trades in the whole of my 4 years of trading career. Very low pressure about potential loss and made decent profits.”

Read that again – very low pressure about potential loss. This is extremely important. If you are trading and stressed about the trades what do you think will be the outcome? Obviously a stressed result: losses or minuscule profits which you know very well that, it will go away the next trade.

I get many success messages in my WhatsApp/email. Some call me to thank. Most I do not share with you but this one is different. Why? Because this trader DID NOT copy my directional trade. He is a smart trader – he changed the option strikes as per the VIX and other parameters and made a good profit.

Smart Traders Think About Losses First, Then The Profits

In trading business one who is trading smartly is the one who will make money – and smart traders DO NOT speculate. The first thing that’s there in their mind is “what if this trade turns into losses?”

Agreed this is a very negative way of thinking but this is what works in this business.

Smart Traders Hedge

Obviously when you start worrying about the losses you will hedge your trades and not leave it naked, just because you think the losses will not happen. Well the stock will not move in that direction because you think so. It will move in that direction because most people think so and there in no way to find what most people think. Stocks don’t have emotions – so if they have to fall 25% in one day they will – and you cannot blame them if you need to sell your house to pay the losses. The stock will in fact ask you back – why you did not hedge when you had options? You will not have any reply.

This does not mean you should never trade them – it only means what have you done to protect your losses? Lets look at my Axis bank trade. The call was given when it was 484 – in couple of days it went to 468-470 and now today back to 482. A naked Future buyer may had taken a stop loss only to see the stock bounce back. But my customers are still in the trade because their money is protected. They will take out profits when it comes – that’s the beauty of hedging.

On top of that if you can take my strategy and use it in a better way then you can make even better returns. Some hard work on your part is required.

I can show you the direction – the strategy – but the path has to be traveled by you. So start thinking differently – start using your brains to get a better return.

Smart Traders Think Differently

My simple advice if you have taken my course is to start using your brains now. After 2-3 months of practicing you must start thinking differently on how to make it better and snatch a better return.

Smart traders like Mr. Krishna and Mr. Inder do not copy paste the strategies especially the directional – but think before trading. The results are for you to see.

Do not just copy the strike prices given in the course but change them according to the risk in the trade, option premiums and your view with respect to that particular trade. Practice it with one lot and see how it works. Next time when you trade, change the strike price according to your view and see if you can get a better return.

Smart Traders Experiment, But Know That If It Doesn’t Work They Can Always Go Back to What Worked

In the worst case scenario if it’s not working as per your wishes, then of course you can come back to the original strikes. Nothing is lost as you traded with one lot or you can always paper trade.

Smart Traders Paper Trade A Lot

Do you know you can do thousands of paper trade in a year? No power on this earth can stop you from paper trading. And you don’t pay a dime to your broker for that neither you need any cash to trade thousands of lots on paper. 🙂

BTW when I used to research on paper (I still do), I always traded with 1000 shares (not lots shares) irrespective of the stock – so that profits or losses can be multiplied by 1000 and I get a significant number to see. If you lose only Rs. 100 in a trade on paper you will feel that that the strategy is good except it needs a small change. Fact is if you trade with 1000 shares you get a different figure and of course the way you think after the result will be different.

Smart traders will almost always come out winner. See even if they make 2% per trade and if this comes in 10 days – we are talking about 6% or more return a month.

Let me be very frank – the results will differ from trader to trader, but mostly people who use their brains and not copy paste the strategies are the ones who will almost always make more. You have to know what works best for you – that’s the ultimate in option trading research.

Smart Traders Do Not Listen To What Others Say

For example if you are comfortable in Future trading then do not stop trading Futures just because someone told you that something else works better. Try the best possible hedges on that and see how you can manage them. This advice is applicable to everyone irrespective of whether you have taken my course or not.

Let me talk about the non-directional strategy. This is for people who have done my course. Have you ever tried to make more from the non directional? I mean changing the strike prices according to VIX or pending news etc. Have you ever tried that?

You see we are totally hedged. When the losses are limited why not try to make more while still making sure that the trades are fully hedged.

Do not change the essentials but you can always experiment to see what works best for you.

And of course send me testimonials. 🙂 The happiness I get by seeing you succeed is unparalleled.

Just one testimonial and I got motivated to write a 1500+ word article. Keep them coming – makes me very happy.

This was a comment by Mr. Sunando – one of my blog’s avid readers. It was so relevant I shifted it to main article – because few people read comments:

Its necessary to be smart as a trader to acquire the winning trades having mostly the institutions as main opponents. We can’t move the market a single paise with our money and buy sells. We can just follow the market, and being smart is the main thing to get emerged as a winner.

Some of us learn this fast some delayed and some never.

Whatever written by you above including hedging, adopting a simple plan with no deviation (holy grail never exists) and executing the same with consistent consistency is all.

A clear mind with simple calculation skill can make trades a success. We are here not to donate money to the market , rather acquire.

Golden two rules says :
1) Don’t loose money
2) Don’t forget rule number 1.

So hedge and win. Calculate the return in % – control your mind and be happy beating the bank rate in double/triple, cumulate the capital year after year.

Finally I end with a quote by Michael Marcus (sent on my WhatsApp by Mr. Kirank another avid reader of my blog):

“The best trades are the one which are in synchronization of three aspects which are Fundamentals, Technicals and Market tone.”

Thanks.

Note: Update to Bihar elections results and profit booking is here:

http://www.theoptioncourse.com/india-vix-dropped-book-profits/

Bihar elections are going on. This may impact the options volatility and we can benefit from it.

At today’s close INDIA VIX is 19.48 up by 1.60, or 8.95% up from previous close.

You can see it here:

http://www.moneycontrol.com/indian-indices/india-vix-36.html

I assume this will increase till this Friday, 6th of November, 2015. I think will go up to 21 or 22 and then fall. Since counting is on Sunday, 8th of November, 2015 – VIX will fall drastically on Monday by the time results are out. From Monday it will keep falling until it stabilizes to 16-17 levels.

Trading The VIX

Some of my readers trade the VIX itself. Well if you don’t know VIX can be traded in India. You can trade only Futures by the way as of now. So if you are risk averse please do not trade VIX as it cannot be hedged directly. Well it can be hedged with equity cash holdings or options of Index – but its out of scope of this article.

You can find about trading the India VIX here and here.

VIX trading if done right can make a lot of money, but let me warn you its very risky as well. One lot is valued approx 10 lakhs and you can see how it fluctuates in one day. 8% fluctuation means you make or lose 80,000 in one day on one lot only. So think before you start thinking of trading the VIX. 🙂

Right now I don’t think retail traders are trading it, but the institutional investors and high net worth individuals do. If you are one of them please tell about your experiences in the comments section.

What to Trade Tomorrow till Bihar Election Results Are Out?

If you have bought my course:

Trade the directional strategy on Nifty. Remember the option prices will not decrease soon so even if the Future direction is wrong – the options will make more than Future losses. And of course if you are correct on Futures you make money anyways. 🙂

When to exit: Any time you are making a 3% profit on margin blocked. Number of days to stay is NOT important. But the maximum time you can be in the trade is until markets closes for trading on Monday – 9th of November, 2015.

After that VIX will start dropping which is not good for the directional strategy. Trade like a pro – exit and look for another opportunity.

If you have not bought my course:

Well why should I tell you? 🙂 Just joking. The easiest trade when VIX is increasing is to buy options. Well buy both the Calls and Puts. Buy tomorrow 3rd November and exit on Friday 9th November. Hope for a movement and VIX not dropping. Well VIX will not drop at least till the results are out. Sometimes it may drop slightly after the exit poll survey results are out by the media. But that may happen only on Friday.

When to exit? When you are making a profit of 10% on margin blocked. Why not at 3% which I always advise? Well the trades and the objective of the trades are different. Basically buyers are losers – so when there is a chance to make – take at least 10% home of margin blocked.

Of course you have to close your trades on Friday whether you make a profit or not as after that its almost guaranteed that VIX will drop and you can lose a lot of money. Trade with a plan and the plan is to exit the trade when VIX has started to drop. Believe me after that even if a movement comes – your trade will still make a loss as VIX will drop and the theta will also take a toll on the premiums – remember 5-6 days would have already passed. Options love to lose value as fast as they can. So enter tomorrow and exit this Friday.

Important note: When buying options risk management is very important as 100% of the margin money can be lost. Though chances of losing all money is next to nil as you are staying in the trade only till Friday – still see how much worth of options you can buy. Do not buy more than that.

What to Trade On Monday After The Bihar Election Results Are Out?

If you have bought my course:

If you do not want to trade the directional strategy then take the non-directional trade on 5th or 6th when VIX will be the highest. The profits will come in few days. You should be able to make good profits within a few days because next week VIX should keep dropping. And I really do not think very huge movements will come. Even if it comes dropping volatility will help us.

Rest you know when to take profits out.

If you have not bought my course:

Of course these are the best time to sell options, but the unlimited loss risk is always there. So trade with caution.

You can take my course and learn the best methods of hedging and trading virtually stress-free. Not only will you trade worry-free but you will start making profits.

Click here to learn more about my course.

Note: Update to Bihar elections results and profit booking is here:

http://www.theoptioncourse.com/india-vix-dropped-book-profits/