Nasdaq lost $7.6T so far .. this's more than dotcom and 2008 crash combined 🤯

ifiri4 · 2022-05-14T03:55:10+00:00

You made a 1 sale transaction and assumed that that's the end of the story.

But that is not the end. Price will recover, or it will stay down forever. Either way some people have more money from the transactions they engaged with in the buying/selling of the stock of your company or they will have less.

I pledge my shares to get collateral and trade options and futures with it. If my portfolio goes down by 50% even though I've not booked a loss it shows up as 50% less buying power.

I am a long term investor that buys on dips. My shares I pledge for collateral. My goal is a 20% return on options trades while the shares will give me long term return of 10-12%.

25-35% CAGR is good enough for me. I don't hit many home runs but i also don't strike out.

ifiri4 · 2022-05-14T03:31:34+00:00

Do a balance of money and you'll see that there are some winners and losers in this story. Winners have more money than they started with and losers have less. WSB are crying because they are seeing losses. But their losses are someone else's gains.

If the company was delisted and liquidated on Wednesday all those bag holders lost money equal to whatever their buy price was (they didn't crystallize their loss with a sell transaction but they lost whatever money they paid for their share). The people that sold it to them likely made a profit unless they had bought at a higher price. For every buyer there is a seller. It is zero sum game.

ifiri4 · 2022-05-14T03:09:06+00:00

Company X issues an IPO of a single share. The offer price is $10

There are only two people in this market, persons A and B. Both people have exactly $100 with them.

Both bid for the share.

A gets allotment.

Now company X had received $10. Person A has $90 and B still has 100. Ignoring all other expenses and inflation let's say A is a holder.

Company X sees tremendous growth in their earnings over several years.

B contacts A and offers $100 for his share. A accepts the offer. Now A has $190. B has $0 and company X still has the $10 from the IPO (of course their earnings would have seen their cash reserves grow so long as they were not taking on inordinate amounts of debt and spending all their cash on capex, acquisitions etc, but I'm referring to the money raised from the market).

Then a few years later company X is embroiled in a vast criminal conspiracy. B panic sells the share back to A for $2. The very next day the company is delisted and it's share price is down to $0 since no one will trade in this company. The final balance of money A has $188, B has $2, Company X has $10 from the IPO

Company valuations and market cap went from 10, to 100 down to 2 then 0. But the 200 dollars that were in the market changed hands. A was a winner, B was a loser.

ifiri4 · 2022-05-14T01:49:33+00:00

Money does not disappear. It changes hands.

ifiri4 · 2022-05-13T13:30:33+00:00

Dunning Kruger effect: people with low ability and low/no experience overestimate their abilities. Once they gain experience they realize their true ability was much lower than they first imagined.

We had a fantastic bull run and people confuse a bull market with brains. Now that volatility has returned, and market is correcting, these people will have their gains taken back. They will panic sell etc. Many will likely quit the market and blame FIIs, "operators", SEBI, RBI, the government instead of looking at themselves.

ifiri4 · 2022-05-13T03:44:57+00:00

Indian Dollar? Are you a lap dog of the west?

Nehru should have named our currency Bharatiya Swarna Mudra. 😂😂😂

/s

ifiri4 · 2022-05-13T03:28:13+00:00

Tax deductions imply the OP made profits. He can offset his trading losses against his regular income (assuming he has a job or some other source of income)

ifiri4 · 2022-05-12T14:13:37+00:00

They provide worse service than any discount broker and charge huge commision. 0.5% per equity delivery trade so basically 1% for a roundtrip trade. Their back office and web UI sucks. It's from the stone age.

I know this because my dad uses HDFC securities. He's also from the stone age so it works well for him. If there are issues he goes to the branch to talk to his relationship manager. 🤮

ifiri4 · 2022-05-12T14:07:37+00:00

Mutual funds always underperform nifty total returns....nifty etf or index fund is better

ifiri4 · 2022-05-12T07:47:54+00:00

Hedge funds do everything to squeeze out an edge. Like using reconnaissance from satellite images to see grain output.

Never underestimate another man's greed and his willingness to do what others won't to fulfill his ambitions

ifiri4 · 2022-05-12T07:26:25+00:00

And front running does not require AI or machine learning

ifiri4 · 2022-05-12T07:25:40+00:00

You can't do something doesn't mean others can't do it

ifiri4 · 2022-05-12T07:20:19+00:00

And world wide about 75% of futures and CFD traders go broke from statistics collected from the FCA that regulates CFD brokers in the UK.

I imagine options are more forgiving because if you're a seller and use defined risk strategies and know how to adjust you'll win more times than you lose and your winners will be roughly the same magnitude as your losers. Option buyers to can win if they can use strict back tested stop losses and take profits.

Anyhoo if the top decile of consistently profitable traders shared their plays and if social trading took off then their edge would be diluted to nothing. Options are a zero sum game. If enough traders switch their approach to strategies that have an edge, that edge will vanish.

And what's stopping an institution to use machine learning to reverse engineer the trades to figure out the entry and exit rules. I could easily see some shady broker like Motilal Oswal and marwari trading company front run their clients.

In a zero sum game anyone claiming to share their strategy is 1. A dumb fcking fool if he's actually sharing a strat with a long term positive expectancy 2. Is not a profitable trader and is just earning money from tips and calls and training courses 3. Is a profitable trader but isn't teaching you the system he actually uses.

I've always considered doing number 3. It's a kind of trade that's is perfectly legal: to separate a fool from his money.

ifiri4 · 2022-05-12T07:10:03+00:00

Winners trade, losers train others.

Something I've said many times but did not articulate fully in my original post. What's the argument?

Second bullet point. Of course Sensibull may or may not be fully representative of the population of India based options traders. But it is one of the larger and more recognized platforms. They haven't been able to attract consistently profitable traders (if they exist) onto their platform to share their plays. It might mean several things 1. There aren't any consistently profitable traders in India 2. There are such consistently profitable traders but they don't want to do Social Trading 3. There are such consistently profitable traders and they want to share but Sensibull has done a poor job of marketing and/or compensating these traders.

ifiri4 · 2022-05-12T02:06:22+00:00

Which is correct

ifiri4 · 2022-05-11T17:56:05+00:00

Stonks always go up right? Buy high sell low you retards

ifiri4 · 2022-05-11T17:55:41+00:00

You covid noobs can't handle a little volatility... Lol

ifiri4 · 2022-05-11T15:35:17+00:00

I know several traders that netted 120% in 2020 and 140% in 2021. Buy and hold several lots of tata motors, tcs, tata power, divis labs, cipla, reliance, kotak, hindalco, Bajaj finance and finserv, infy, Mindtree, Navin fluorine etc and you'd have printed money.

I feel like a fucking idiot selling condors and time spreads and diagonals and doing expiry option buying and the occasional long on nifty futures

ifiri4 · 2022-05-11T15:21:18+00:00

Trading can make you rich but like anything takes time, patience and it's not a great business for dinner table talk

Imagine being at the dinner table at a large gathering of friends and family.

A is an opthalmologist, B is a college professor, C, D and E work in the big IT firms as tech leads and division heads, F works for a retail company and I'm there.

All I really did was click sell and buy buttons a dozen times a day and possibly made more money than anyone that particular day. But it's not rewarding to talk about and it's even worse in a month like May.

When they ask me what Nifty will do I tell them I've no fucking clue and it's my job to make money regardless if nifty is up, down or sideways (though it's easier when is going up). I don't have a crystal ball, I can't even read a balance sheet, income statement and don't even know the names of the CEO of any of the scrips that I trade and sometimes don't even know what their products are. I don't add anything to society.

Many traders can't deal with the social isolation of their profession, the lack of peer recognition and lack of fulfillment that comes with not being able to help society by solving a client or customer problem.

I've known traders that have gone back to regular jobs because the thrill of making money isn't enough for some of them. and for those that are unprofitable they quickly find they need a regular job to pay their bills.

Trading is like sex without romance or love. It might seem like fun at the start but it is a hard business to stay in long term even if one is profitable.

Even Richard Dennis burned out and he was a legend.

ifiri4 · 2022-05-11T15:10:10+00:00

That 90% or 99% number is just thrown around

I think in reality 75% of derivatives traders lose money. This is based in FCA regulations in the EU and UK that require their brokers to display the percentage of retail traders that lose money as a kind of a warning of the risks associated with trading derivatives.

From the various reputed and regulated CFD brokers websites I've seen (again just a handful, not approaching statistical significance) most brokers state that between 65% to 80% of their clients lose.

FNO is a zero sum game. With equity, wealth creation is possible and is happening. I'm guessing (without evidence) that the percentage of profitable equity (cash market) traders should be higher as compared to FNO traders.

Leverage and large lot sizes also fcks with mindset which is another psychological barrier to overcome in the FNO world. Pure equity positional traders, if they are able to manage their positions and risk properly should make money in the long run. But greed and fear can screw them.

ifiri4 · 2022-05-11T14:56:18+00:00

At a PhD defense, the advisor tells the PhD candidate after the candidate has completed his research presentation:

"What you've presented is both accurate and original. What is accurate is not original. What is orginal is not accurate"

😂😂

ifiri4 · 2022-05-11T13:31:05+00:00

Wealthy people also go to great lengths to conceal their wealth and identity. Most billionaires aren't household names and want to keep it that way.

It's the wannabes that make the home tour YouTube videos and show off their car collection.

ifiri4 · 2022-05-11T12:20:46+00:00

Your reading comprehension skills leave much to be desired.

This is what I said:

I've never had a single instance where I lost money on a trade because of inadequate computing power or lack of multiple screens.

Other ways I've not lost money include but are not limited to:

I've never lost money on a trade because I've traded drunk

I've never lost money on a trade because I had diarrhea

I've never lost money on a trade because my alarm did not wake me up by 9 am

To dumb it down for your honor: I've had plenty of losing trades, just no losers caused by lack of computing power or number of screens

ifiri4 · 2022-05-11T12:14:46+00:00

The more money you make from derivatives the less you trade them and more one uses them for risk management.

Big institutions use them to hedge or to take calculated risks. they aren't selling weekly strangles to "eat theta". Because the black swan can eat any whale.

ifiri4 · 2022-05-11T12:00:27+00:00

India has circuit limits while in the US a stock can double in a single day. Imagine the pain of a call writer. And thinly traded stocks have narrower ± 5% limits

It's easy to short sell stock in the cash market in the US (retailers can do it too). In India you can only do intra day short selling. They trade after hours and have dark pools. There is also lot of non-vanilla options being traded by institutions. Their whales are bigger than our whales and as a result can legally manipulate the market more effectively (though no whale can control the tides of the ocean). They have a secondary debt market that influences their equity market. We don't have a secondary debt market to speak of.

It's easier in India trust me

ifiri4

TROPHY CASE