In a highly volatile market, the best possible strategy is to change your trading strategy in the following way.
• Trade light with strict trailing stop loss
• Buy or sell in staggered way to make most of volatility
• Do not carry overnight positions except high risk traders
• Fix stop loss as per your risk appetite and position
• Fix achievable target in view of market conditions
• Exit a trade at a slightest hint of weakness
• Your 1st target is to protect capital
• Avoid buying a stock after it has run up too fast
• Never catch a falling knife( stock)
• Even if all these precautions a trade goes wrong, do not try to average or hold as it, just close the call and hunt for new opportunity.
Saturday, 12 November 2011
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