Concept
Through this technique You can rip 100% of your Investment per Month.
FORMULAC x L x 2.5 / 100 = G
G / 10 = N
N x 2 x 5 x 4 = GM
EXPLANATION
C = This is the Capital
This means, your investment in the trading account.
L = This is the LeverageThis means, the Leverage given by the Broker for Trading. Normally the Leverage will be 10 times.
2.5 / 100 = This is the Percentage of Estimated TargetThis means, the Percentage of Trading Target of your Total Trading Amount per Trading Session.
G = This is the Gross AmountThis means, the Gross Amount to be gain by you from one Trading Day.
G / 10 = This is the Amount simplified to achieve the TargetThis means, the amount simplified to achieve the Trading Target per Session.
N = This is the Net AmountThis means, the Net Amount per Trading Session.
2 = This is the number of sessionThis means, Before Noon and After Noon per Trading day.
5 = Number of DaysThis means, the Number of average Traded days per Week.
4 = Number of WeekThis means, the Number of Traded Weeks per Month.
GM = Grand Margin per MonthThis means, the Grand Margin of your Successful Trading of the Month.
DETAILED EXAMPLE
For Example, If you invest Rs.10000 in your Trading Account, The Broker will give 10 Times Leverage to Trading for Cash Market. As per our Formula we can find out the Grand Margin for this Amount.
C x L x 2.5 / 100 = G
G / 10 = N
N x 2 x 5 x 4 = GM
10000 x 10 x 2.5 / 100 = 2500
2500 / 10 = 250
250 x 2 x 5 x 4 = 10000
Your Investment is Rs.10000 and You will get Rs.10000.
WHAT IS SUPPORT ?
A support level is a level where the price tends to find support as it falls. This means the price is more likely to "bounce" off this level rather than break through it. However, once the price has breached this level, by an amount exceeding some noise, it is likely to continue falling until meeting another support level.
WHAT IS RESISTANCE ?
A resistance level is the opposite of a support level. It is where the price tends to find resistance as it rises. This means the price is more likely to "bounce" off this level rather than break through it. However, once the price has breached this level, by an amount exceeding some noise, it is likely to continue rising until meeting another resistance level.
METHOD TO CHOOSE THE STOCK
To find the best stock to trade you must follow the NSE Official Website. In this website, you can find the stock from the list of Most Active Securities or Top 5 Losers or Top 5 Gainers.
AN ENTRY POINT
After the selection of scrip keep watch with good concentration from 5 minutes to 30 minutes. Within that time you can find what is the support or resistance price. With right time make an entry. Exercising patience and waiting for the right time to buy or sell will help you earn better returns of your investments. Determining an entry point is important strategy for investors who want to maximize their returns. In this way, if you buy one stock the support level should be in the bottom of its movement and for the sell it should be in the top of its movement.
FIX THE TARGET AMOUNT
If your Total Trading Amount is Rs.100000, Simply find the Target Amount with following way.
100000 x 0.25 / 100 = 250
If you decide to buy the stocks of Vedanta Limited, for example per stock price is Rs. 80/- and you can purchase 1250 shares for Rs.100000/-. This means you can entry when the stock price is Rs. 80.00 and you must exit when the stock price is Rs. 80.20. That's all. So 1250 x 0.20 = 250/-.
FIX THE STOP LOSS
The Stop Loss Amount will be twice of Target Amount. As per the above example it will be as Rs.79.60. When Stop Loss Triggered 3 times continuously, You MUST study well What is the Resistance and Support.
CAUTION
Normally if you select good scrip with good moving, achieve the target within 5 minutues to 30 minutes. If not don't spend more than 30 minutes after the Entry Point per session. After 30 minutes immediately squire off even it was profit or loss. Andalso do the trade only two session One in before noon and another one in after noon.
Happy Trading !
The topic is explained very well and makes us aware about the investment psychology of greed, fear and hope.
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Thank you for your analyzing..
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