Unitech is one of the biggest losses in my life
that really devastated me in 2006. I believe I lost almost 90000 (89500 is the
exact amount) in that trade. My broker was Kotak Securities. I still remember
that day. I was at Chennai. I bought 500 shares while Unitech traded after
split and bonuses and was around 350 bucks. On that day it went to upper
freeze, got released and was trading down a percentage point. I bought 500
shares at that time and at lower freeze I bought 300 shares (Don’t show a fucking
urge to average your losers-Important lesson). I owned almost 800 shares. From
that day Unitech continuously opened at lower freeze and it continued for
almost a week and Unitech was trading around 180 bucks while I returned back to
my home town to pay my margin of more than lakh and half to my broker. They
thought I ran after that day (I remember a guy who got abscond after losing 5
lakhs in 2006 crash). Luckily for them, I’m a decent guy who really wants to
pay the dues and continue to pay tuition fees to the market to make a career in
stock markets. Despite paying one and half lakhs I was in debit and pressure
was made to cut the portion of the shares to pay for them. If you are real
loser you would blame Kotak securities, but I still remember of not making any
complaints against them for their pressure (Even today I couldn’t believe that
I showed that kind of maturity despite doing sucking trade) to pay their
margins. I asked their permission for 3 more days and they gave me that and
eventually booked my losses at 215(215-220). A week after booking my
losses Unitech was added in futures and from there it started to rally and it
eventually crossed than my buying price of 350. What an irony? I lost 90000
bucks in that trade.
Lessons:
1.
Have an idea on stock which you want
to buy. Idea doesn’t necessarily mean knowing all the fundamental stuff and
technical stuff. Idea means atleast a price movement of the stock.
2.
Don’t rush to catch the so called
momentum stock. You know what was in my mind. I thought Unitech would continue
to put more upper freezes and I planned to sell after 3-4 upper freezes by
making a leveraged bet. Even now I can’t stop laughing about my idea of
entering into that trade.
3.
Don’t make leveraged bets without
knowing stuff (Even now I make leveraged bets).
4.
Don’t blame your broker or dealer for
your sucking trade (Candidly speaking this is one of the thing that I’ve never done in my entire career). I have seen people doing this and I really feel
sorry for those dealers.
5.
Don’t bet on your own imagination.
This is one of the worst things you could do in stock markets.
6.
Don’t predict on direction of the
stock. If someone says that they are making predictions on stocks, be wary to
work with them.
7.
If you are operating in Indian
markets, try to put stop losses on momentum stocks that are having price limits
(stocks that are not in futures) in trading.
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