Thread on simple trading setup-
Applicable for option selling for Straddle-
Risk Management - you should not risk more than 1 to 2% of your capital on any single day
SL - Your SL should be in system. You can keep different SL for different days but need to be consistent
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Applicable for option selling for Straddle-
Risk Management - you should not risk more than 1 to 2% of your capital on any single day
SL - Your SL should be in system. You can keep different SL for different days but need to be consistent
π§΅
You can keep your SL from 20%- 60% based on your daily max risk appetite i.e.(1%-2%)
Before entering into trade you must have SL and profit target in place.
Don't be greedy and fearful once trade taken. Now it's market turn, you don't have to do anything.
Follow same setup daily
Before entering into trade you must have SL and profit target in place.
Don't be greedy and fearful once trade taken. Now it's market turn, you don't have to do anything.
Follow same setup daily
DD management- For 1 lot, ur capital req is 1.75L, then on any single day you should not lose more than 2500rs/1.5%.
For DD management you must consider cushion of min 10days of daily max loss amount
If your risk per day is 2500 then you must have 2 L at month start.
For DD management you must consider cushion of min 10days of daily max loss amount
If your risk per day is 2500 then you must have 2 L at month start.
Execution - Now based on your predefined rules, trade with single lot for entire month without any changes.. Consistency is key here.. If you achieve your target early, you can close for the day or can re-enter with the same setup.
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Now you have to revise your max SL & target.
e. g. Suppose in first straddle you got 1750 profit 1%
Now for 2nd straddle your revised max day loss is (2500-1750)=750rs.
Profit booking should be done at 1% i.e (1750+1750)=3500
Close for the day if either profit /loss target hitπ§΅
e. g. Suppose in first straddle you got 1750 profit 1%
Now for 2nd straddle your revised max day loss is (2500-1750)=750rs.
Profit booking should be done at 1% i.e (1750+1750)=3500
Close for the day if either profit /loss target hitπ§΅
Journal - This is most important part .
You must journal every trade with lesson learnt and try to maintain execution accuracy of 100% for your predefined setup.
These lessons learnt will help you to improvise your trading strategy
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You must journal every trade with lesson learnt and try to maintain execution accuracy of 100% for your predefined setup.
These lessons learnt will help you to improvise your trading strategy
π§΅
If you follow these simple rules for entire month, you will start your journey of rule base trading..
Once you learn to survive then market will definitely reward you beyond what you expect in the long run..
!! BE CONSISTENT AND KEEP IT SIMPLE !!
Once you learn to survive then market will definitely reward you beyond what you expect in the long run..
!! BE CONSISTENT AND KEEP IT SIMPLE !!
Here, max loss for 2nd straddle is (1750-2500)= -750.. Read 750 as -750 (negative).. sorry for the mistake.. π
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