NIFTY FUTURES? IS IT WORTH TRADING FOR INDIVIDUALS

Many people (individuals) think that they can make lots of money in NIFTY FUTURE trading. But in each trade cycle they lose some thing. Pity is that they do not realise their folly and get out. They try to recover the lost amount and again lose. They also subscribe to TIP PROVIDERS thinking that they are god men. In reality again they lose either due to their wrong entry or due to the STOP LOSS trigger mechanism. NIFTY FUTURES is not a worth scrip to trade now for the following reasons.

1. Market has gone to over bought zone beyond its real worth. BANK NIFTY is still worse. It has gone up very disproportionately. There are so many hidden problems in Indian economy. These will be divulged to the public one by one in a planned manner. The media blows it out disproportionately and finally this leads to a negative psychology of the investors and sell off with heavy losses. At that time FIIs will be coolly buying them. Hence it is better to exit all long positions by booking profits if any and feel satisfied.

2. Now a days market spread is very less. Except for the break out calls NIFTY trade swings are limited just to 5 points and some times it goes up to 10 points. You can not predict the break outs / break downs. In break outs, one may lose heavily if he is on the other direction. Market is active only during first one hour and last one hour.

3. When market goes adverse to the investor’s holding position the funds are taken away by the broker / exchange regularly on day to day basis.

4. During intra day when the individuals’ position is against the market direction the systems do not accept even hedging orders. We have to be at the mercy of the broker who in turn has to take permission from Head Office. Passing through various procedures, by the time the permission is received, a good opportunity is lost or one may be put to more loss.

5. HNIs, DIIs and FIIs can continue to trade in any scrip including NIFTY Futures, because they trade with other’s money. Even if they lose heavily, still they can have comfortable sleep at night. It is not so for INDIVIDUALs.

6. It is always safe and better to have a rational approach to make money in stock market by picking up good scrips at APPROPRIATE PRICE and at APPROPRIATE TIME.