I've seen a funny behavior from people who didn't want to reveal mistakes they made in stock markets. If they made winning position they use to boast that for months and years. But they didn't want to open anything that went against them. You know what it would be. Only few make 70-80% winning trade. Most of the traders or investors doesn't reveal their true losses. I just want to be opposite to others and would like to put my losses in writing. I believe that I could learn a lot from my losses and could learn more in the process of becoming a decent trader. As a result, I'd like to put my mistakes on board.
From here on you'd hear mistakes that has been made by me in stock and commodity markets. I'm willing to reveal all my dumb mistakes I've been doing in this trade. Hopefully I'd learn a lot from my mistakes.
My First Mistake in blog:
I shorted Gold and got trapped heavily and today morning I covered my position. I'm least bothered about the losses I made in this trade. But the manner in which I made is what that is concerning me. Despite being Gold Bull, I shorted Gold for temporary pull back and caught by the bull.
I lost almost Rs.40K in panic covering today. This is one of the worst day for me. Honestly, I'm losing big money after 4 years. This is the first time in 4 years I've been making big losses in my life. I've lost almost Rs.2 Lakh in Gold Short. Last time I made my loss of this magnitude was around July or August 2007 when I was shorting nifty and it rallied more than 500 points.
After that loss, there was no looking back. I've been continuously making decent profits and in 2008 I made big profits during September sell off and in 2009 I made huge huge profit during Nifty Upper Freeze, which was my biggest one day gain every in my history of trading. My profits were more than 2000% in a single week. That was tremendous time.
I was consistently making money in stock markets. Well I had bad day too. But the magnitude of losses were very small and I didn't remember making losses more than 10000 in a single day. Today I booked losses amounting to Rs.2 Lakh and in this process I could have reduce my losses by more than 40K-50K. Well, it is panic covering and I'm ashamed that I made this. Despite having great gut feeling and temperament I covered in panic and this is a biggest lesson for me. Hope to make mistakes and learn for another couple of thousand times.
Note: I'm formulating strategy to recover my 2 lakh losses and I need to work hard to formulate strategy to overcome my losses. Till then, I'll be licking my wounds.