Muses of Murari

Today is a big day for me.

I am writing this for my own reference. As well as I want to share with the world.

I’m a stock market learner. I’m very much in learning mode and I’ve started investing in good fundamental companies for long term capital appreciation and of course for dividend money. I am very disciplined in my approach until this morning. I lost quite a good amount of money in my first Intra-day trading. I’d no idea  that I’d do intra-day trading, until this morning. But, my greenish impulse just took control of me and did buy shares of a good company, which supposed to announce excellent result today. To my expectation, the company’s quarterly result is excellent but thanks to Mr. Market, my trading decision went exactly opposite. Mr. Market started to slide and the stock I bought too did. Catastrophe.

I did put stop-loss to my buy. But I did it not based on market moods but on my conviction of the company’s business. This is my first mistake. Mr. Market, when on roll, doesn’t bother about fundamentals. He can be ruthless. I understood that by what he did to me today.

I kept reducing my wide-margin stop-loss trigger, as the stock price was coming down. After the company announced very good results, I thought that Mr. Operator can stop his accumulation and start jacking up prices. This is my second mistake. Mr. Operator continued to rake in shares at lower prices.

Stop-trigger did executed. After this, my green impulse motivated me to buy again, even without an after-thought, expecting Mr. Market will rise from ashes. But, Mr. Market is no mood. This is my third mistake.

At EoD, leading indices corrected 2.5%. The stock I bought corrected 7.25%.

One good thing I did, at the end, I took delivery of the finally bought shares. And I was complete aware, from the start, how big I’d lose. A big lesson learnt. I read lot of blogs, books saying that a newbie to stock market, should never try intra-day until he learns basics thoroughly. I accepted it as fact. But, what I did today though I knew that I’m not well equipped for the job, is simply unacceptable. This deepens my conviction on the fact that experience is the true learning  tool.

I was in control till yesterday. Today, I succumbed to my emotions. This is my first big lesson to me. Blame it on ill-luck, I learned it on a wrong day. Ironically, I was reading a book by Swami Vivekananda and in that there is a section where Vivekananda talks on emotions/thoughts taking over human intellect. I appreciated the truth. But, when it came to practice, I consider myself very much flunked.

Well, after this experience, I become more clearer in this area. This means I am learning. So I’m happy to accept this mistake and move ahead. I cannot change what had happened today to me. Thanks to the experience, I came to know how unchecked human emotions can make a person weak.

Well, tomorrow is another day.

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• Note to myself – II
• GoldQuest/QuestNet – a crooked model
• GoldQuest/QuestNet – Part II