STOCK MARKET - this too behavioural, emotional

I have been watching trends (clues), Investing, swing trading, news trading, day trading, macro economics trading, dealing in futures and options (both call and put).

There are some strong lessons that I learnt in recent times.

1. You dont buy or sell - you are sold and bought shares.
2. Its all behavioral economics -- no one can predict
3. You can predict businesses but not indexes

These were two major lessons now coming to question on SO WHAT? (as I belive learning is fine but SO WHAT - give some workable solutions :) )

So workable solutions are

1. Play with STOP LOSS. In case you are bullish then know where to get out in case of market going low... (based on various things - including your risk taking capacities :) )

2. Rotate your shares. When you think that you have taken decent profits but the market is still moving to higher levels then sell and buy again. This increases you buy price but then the STOP LOSS is also rotated. For instance if you bought RNRL at 22per share and it is at 200 - sell and buy again (may be at 195 or 205 - market will give the opportunity for sure as market does not move up or down in straight lines) and keep a stop loss at 180 or 185 as the case may be). This can be a standing instructions and works quite good in FnO as the volatility is high and profit / gains are also high.


Feel free to give your inputs on the same.....

nityn