A SPECIAL REPORT ON Market Strategy

9 Great tips from Stock market Masters

Great traders are created, not born. Those who lack discipline, persistence and self-
confidence lose the never-ending challenge of trading profits. But those who
survive the battle by using the tools used by the masters enjoy the fruits of
consistent success. Different master traders use different methods and approaches.
But what is that one aspect that the greats all agree on, masters ranging from
George Angell, day-trader, technical analyst par excellence; Gerald Appel, father of
MACD, one of the most widely followed timing tools; Bruce Babcock, developer of trading software;
George Lane, father of stochastic and one of the most experienced technical analysts in the world;
Robert Prechter, the pre-eminent Elliott Wave analyst whose forecasts are followed by traders
throughout the world; Welles Wilder, the man behind Delta and RSI and developer of technical tools
that have revolutionized the trading world; and Larry Williams, colourful, controversial - a legend in his
own time.No, it's not some glamorous or sexy new fail-safe technique. Rather the one aspect of
universal agreement among master traders is the importance of discipline. Discipline is probably the
most worn-out term in trading. But that doesn't alter its importance. Also, saying the word is one
thing; truly understanding its dimensions on an operational or behavioral level is another. Here are the
golden rules of disciplined trading.

Be persistent

This is perhaps the single most important quality a trader can possess. Trading requires the ability to
continue trading even when results have not been good. Due to the nature of markets and trading
systems, good times frequently follow bad times, and bad times frequently follow good times. Some of
a trader's greatest successes occur following a string of losses. This is why traders must be persistent in
applying their trading methods and continue using them for a reasonable period of time.

Accept losses

Another important quality that the market masters emphasise is the ability to accept losses and to take
them promptly. Perhaps the single greatest downfall of all traders is the inability to take a loss when it
should be taken. Losses have a nasty habit of becoming worse rather than better. Unless they are
taken when they should be, the results will not be to your liking.

Avoid overtrading

Too many traders feel that they must trade every day. Such traders are addicted to trading. The fact is
that some days offer few if any trading opportunities. The trader who wishes to preserve capital and
avoid losses as well as unnecessary commission charges should understand that trading, other than
mechanical day trading, is not an everyday event. There will be days when no trades are indicated. This
is for the best.
A SPECIAL REPORT ON Market Strategy

Specialize

Successful trading is a time-consuming undertaking that requires close attention. Which is why many
market masters specialize in certain markets. In most cases, successful trading requires diligence,
follow-through and persistence. Because most trading techniques require close attention, traders
should not be involved in too many markets at one time. Suggest that five to seven markets are
sufficient for most traders. In fact, for new traders, I recommend specializing in one or two markets
and attending to them thoroughly to develop your skills and increase your overall profits.

Begin with sufficient capital

Perhaps one of the worst blunders that any trader could commit is to trade with insufficient capital.
Virtually all the market masters agree on this point. The argument may be made that the futures trader
does not need to have substantial capital in his or her account since trades are closed out at the end of
the day and therefore the necessity for sufficient margin to maintain positions is eliminated.While this
may be true, those with limited funds cannot play the game as long as those with larger funds. In any
venture it is important to start with sufficient capital so that the trader will not feel pressured to
perform and can allow the particular trading system or methods sufficient opportunity to ride through
periods of poor performance.

Use news to your advantage

Many a trader has learned the hard way that following the news frequently leads to losses. However, I
have discovered ways in which the trader can use the fundamental news or developing international,
domestic or political news to his or her advantage.

Do not be a follower of the news; rather 'fade' the news. Use the news to exit positions that you
probably established before the news became public knowledge. I firmly believe in the old market
dictum: Buy on rumor, sell on news.

On an intra-day basis, markets are very sensitive to news well before the news is known by most
traders. Insiders buy and sell on expectation, sometimes based on rumor, frequently based on fact.
They establish positions before the general public is aware of the news; once the news has become
public knowledge, they take advantage of the surge or the drop in prices to exit positions.

Take advantage of brief price surges

At times, markets will drop or rally quickly, seemingly in response to no news. What may be happening
is a rumor on the trading floor, a large buyer or buy order, or large seller or sell order of which you are
unaware. Such brief price surges or drops are opportunities for you to exit positions at a profit or to
establish a new position. It is important to develop this quality as a futures trader since it is entirely
consistent with the futures trading objective.
A SPECIAL REPORT ON Market Strategy

Stick to your goals

Above all, remember that as a trader you have one major goal: to make money. To do so, you must be
particularly aware of your net profits at all times. My advice, which is based on many years of trading,
is to set you self specific standards and conditions under which you will begin to liquidate positions. Do
so while the trend is still in your favor. You may either begin to close out your positions at that time or
you may use a follow-up stop loss procedure to 'lock in' existing profits.

Use market sentiment to find short-term and day-trading opportunities

I have already discussed the importance of going against the majority opinion to find profitable trading
opportunities. I believe that this is one of the most important qualities a trader can possess. While
there is certainly a great deal of money to be made in trading with the existing trend, it is also
important to know when the existing trend has reached a possible turning point.One of the best ways,
if not the best way of doing this, is through the use of market sentiment. The trader must also be a
contrarian. This does not mean that you must buck the trend, but it does mean that you must always
be aware of whether sentiment is very high or very low. This will give you important clues as to
whether you should be quick to take profits, whether you can allow profits to run and whether you
should look for trading opportunities on the opposite side of the existing trend. I have learned, after
many years of trading, that the major difference between those who are successful traders and those
who are not is found in their discipline, their psychological makeup and in the skills they have acquired
as traders rather than in the trading systems, they use.

Save minimum Cash.

Spend minimum Cash.
Invest Maximum Cash in equities.

And make Indian Economy will Boom.

Pigs get fat Hogs get eaten

Investment decisions should fatten your bottom line, not eat away at it!

Be a Pig not a Hog

A SPECIAL REPORT ON Market Strategy

Top 10Stocks for investment and trading

1. Bayer Crop Science Ltd c.m.p (651.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

39.5 114.17 23.9 33.10 280

2. Bilcare Ltd c.m.p (570.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

17.21 248.50 48.10(CONS) 47.70(CONS) 25

3 BASF India Ltd c.m.p (368.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

28.19 136.65 22.40 30.50 70

4 Resurgere Mines & Minerals India Ltd c.m.p (93.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

28.54 125.68 7.5 6.15 NIL

5 NIIT Technologies Ltd c.m.p (170.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

A SPECIAL REPORT ON Market Strategy

58.77 51.00 15.00 11.1 65

6. English Indian Clays Ltd c.m.p (617.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

4.47 164.25 42.50 51.00 50

7. Zensar Technologies Ltd c.m.p (273.50)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

23.98 106.00 36.10 (cons) 41.70 (cons) 45

8. Minda Industries Ltd c.m.p (277.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

10.51 70.45 14.40 14.30 25

9. Precision Wires India Ltd c.m.p (85.00)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

11.56 122.60 1.0 13.60 24 int

10. Grauer & Weil (India) Ltd c.m.p (66.50)

EQUITY IN CR BOOK VALUE LAST EPS 9 MONTHS EPS DIV %

22.67 77.50 5.5 6.5 4
A SPECIAL REPORT ON Market Strategy

10 Deadly Trading Mistakes!

The following are 10 most common but deadly Trading Mistakes, which traders should
avoid at all costs. Anyone of them can literally destroy one's financial dreams and
goals!

1. Trading for excitement & thrill not for profits. Many traders consider stock market as casino and trade
for thrill and fun only. As soon as one has a losing trade, he wants to quickly make back the lost money.
He thinks about the other things he could have done with the money, regret taking the trade and want to
recover as quickly as possible. This in turn leads to further mistakes. Be patient and wait for the next
high probability opportunity. Don't rush back in

2. Trading with a high ego. Many individuals who have remained highly successful in other business
ventures have failed miserably in trading game. Because they have a fairly big ego and thought they
couldn't fail. Their egos become their downfall because they cannot except that they would be wrong
and refuse to get out of bad trades. Once again, whoever or wherever has any one come from does not
concern the markets. All the charm, powers of persuasion, number of degrees & diplomas of business
management on the wall or business savvy will not budge the market when you are wrong.

3. Three 4-letter words that will kill you! HOPE--WISH--FEAR—PRAY if you ever find yourself doing
one or more of the above while in a trade then you are in big trouble! Markets has own system of
moving up& down. All the hoping, wishing and praying or being fearful in the world is not going to turn
a losing trade into a winning one. When you are wrong just use a simple 4-letter word to correct the
situation-GETOUT!

4. Trading with money you can't afford to lose. One of the greatest obstacles to successful trading is
using money that you really can't afford to lose. Examples of this would be money that is supposed to be
used in any other business, money to be paid for college/school fee, trading with borrowed money etc.
Ultimately what happens is that when someone knows in the back of their mind that they are risking the
money they cannot afford to lose, they trade out of fear and emotion versus logic and no emotion. If you
are in this situation It is highly recommend that you stop trading until you earn enough to put into an
account that you truly can afford to lose without causing major financial setbacks.

5. No Trading Plan If you consider yourself a trader, ask yourself these questions: Do I have a set of
rules that tell me what to buy, when to buy and how much to buy, not just for the next trade, but for the
next 10 trades? Before I enter a trade, do I know when I will take profits? Do I know when I will get out
if I am wrong? These questions form the first part of a trading strategy. There simply cannot be any
expectation of success if we can't answer these questions clearly and concisely.
A SPECIAL REPORT ON Market Strategy

6. Spending profits before you make them. Nothing is more exciting than getting into a trade that blasts
off and puts you into a highly profitable situation. This can cause major problems however, because this
type of trade puts you in a highly euphoric state and leads to daydreaming about the huge profits still
to come. The real problem occurs as you get caught up in the day dream and expectations. This causes
you to not be prepared to get out as the market reverses and wipes off all your profits because you have
convinced yourself of the eventual outcome and will deny the reality of the situation. The simple remedy
for this is to know where and how you will take profits once you enter the trade.

7. Not Cutting Losses or letting Profits run One of the most common mistakes made by traders is that
they let their losses grow too large. Nobody likes to take a loss, but failing totake a small loss early will
often result in being forced to take alarge loss later. A great trader is not someone who has never had a
loss. Great traders have made many losses. But what makes them great is their ability to recover quickly
from a string of losses. Every trader needs to develop a method for getting out of losing trades
quickly. Research and learn to apply the best methods for placing protective stop loss orders. The only
way to recover from many (small)losing trades is to make sure the winning trades are much larger.
After a series of losing trades, it becomes difficult to hold a winning trade because we fear that it will
also turn into a loss. Let your profitable trades run. Give them room to move and give them time to
move.

8. Not Sticking to your plans & Changing strategies during market hours If you find yourself changing
your strategy during the day while the markets are still open, be mindful of the fact that you are likely to
be subject to emotional reactions of fear and greed. With rare exception, the most prudent thing to do is
to plan your trading strategy before the market opens and then strictly stick to it during trading hours.

9. Not knowing how to get out of a losing trade. It's amazing that most of the traders don't have any clear
escape plan for getting out of a bad trade. Once again they hope, pray wish an rationalize their position.
It must be kept in mind that market does not care what you think. It does what it does and when you are
wrong you are wrong! The easiest way to keep a bad trade from going really bad is to determine before
you get in, where you will get out.

10. Falling in love with a stock (Just Flirt).Many traders get fascinated by just a stock or two and look
for opportunities to trade in those stocks only ignoring the other profitable trading opportunities. It is
because they have simply fallen in love with a stock to trade with. Such tendencies can be suicidal as for
as trading is concerned. It may cost any one dearly.

SAHADEVA RAJU ALLURI is an equity research analyst who believes in fundamental analysis and his primary focus is in covering
strong companies that are undervalued which would prove to be low risk and high reward investments for long term. He can be
reached on sdev9@yahoo.com if you have any suggestions, queries or criticism.

DISCLAIMER:-This report has been prepared solely for information purposes and the information contained herein may not be deemed
to be an investment advice. Such information is impersonal and not tailored to the investment needs of any specific person. The
information contained herein is not a complete analysis of every material fact representing any company, industry or security. The
views expressed may change. While the information contained herein has been obtained from sources believed to be reliable, no
responsibility (or liability) is accepted for the accuracy of its contents. Investors are advised to satisfy themselves before making any
investments and should consult with and rely upon their own advisors whether and how to use such information in making any
investment decision. Neither the author nor his firm accepts any liability arising out of use of the above information.