Portfolio
$BTC 1W Largest Scale Playing with Long Term Ideas #LongThis idea i made today for long term idea just as it is an idea some basic lines and formations were made but it was pretty simple using same red lines the decline lines are same angle as it states. showing prices and times as estimates i will come look at this and progression when iI m older and know more of this trading and chart mechanics etc!
I am not a Financial advisor or any way good with number.. sorry that's a lie I am very good with math but I haven't had to make financial gains on markets not crypto at least.! I have crypto but earned it all freely over short time last 2 years have over a few band only a couple,, but free earned and mostly passive about 70% passive :) anyway and so that makes it all gains but i do swap stuff at lows and highs and various coin swaps using special maths and tools no one else does a lot and take advantage of the "virtual arbitrage" between trading oone coin for another and then another .... if you get it you get it!
WHAT YOU THINK OF IDEA its one for me to come back to in years and look and go wow we were at 100k moment JUST like the 10k moment. Only I don't remember It so well!
hope you enjoy! let me know your opinion and what could be wrong or different! lets learn from one another and take over the markets!!!!
Portfolio and the Sensex Correction AnalysisMy personal Portfolio performance against the Indian markets, all with holding period of 1 year to 3 years. (No single stock in the portfolio taken with tips from others, brokers, TV. All research on my own, using Fundamental / Technical analysis learned over past 20 years of weekends).
This includes stocks sold, dividend received, no mutual funds included:
The portfolio has had a draw down of 7.5% from peak from 2 months ago to bottom 1 week ago which was a market correction of 11%
A lot of the Ideas i have been posting over the years on trading view platform were part of my portfolio, when i analyzed a stock i thought i should share. I stop sharing when i didn't have time or had personal issues.
I thought i should share my performance on the platform which has helped me analyse.
Portfolio-and-Sensex-after-recent-11-correctionMy personal Portfolio performance against the Indian markets, all with holding period of 1 year to 3 years. (No single stock in the portfolio taken with tips from others, brokers, TV. All research on my own, using Fundamental / Technical analysis learned over past 20 years of weekends).
This includes stocks sold, dividend received, no mutual funds included:
The portfolio has had a draw down of 7.5% from peak from 2 months ago to bottom 1 week ago, during which Sensex had a correction of 11%.
During correction, i sold weak stocks and accumulated strong ones at the 200d EMA support.
I used Tradingview for all my technical analysis and thought it right to share my performance on this platform.
I am a student of the stock market, i do not recommend, nor take recommendations . Best thing if you don't have the time to do research and the analysis or learn it, as it is a full time job, stick to mutual funds and that too SIP. Or take recommendation from only SEBI registered and experts analysts preferably a authorised portfolio manager.
Disclaimer: i have never recommended stocks, all part of my educational purpose and sharing my analysis for feedback purposes only.
TESLA : Opportunity Time!Hello Team,
Tesla is down almost 75% from the ATH, we are at the bottom of the formation with a corresponding support level. The weekly RSI level is also oversold.
Now is a good time to start opening positions for your long-term stock portfolio.
Enjoy!
How I Position Size: sizing positions as an active investorHey, guys. Wanted to cover a brief overview of how I size my positions of late as I think about how to invest/trade a trend. I will plan to mark this video as an analysis video. Middle part of the video will be reviewing my past activity in NASDAQ:RIVN and how that has helped me learn to temper position sizing as much as possible.
After the Eleven Minute mark, I take the opportunity to review $NYSE:NCLH. I talk a little bit about what position sizing might look like there as well. Position sizing is certainly the most important aspect of trading - especially as you are looking at taking part in long term trends. The volatility within a long term trend can be quite significant (which of course can present opportunities in its own right) and you want to put yourself in the best position to take advantage of a great, long term move. To me, this means entering a position with responsible size so that you are not exiting a potentially great trade too early, or, even worse, with a loss.
Anyway, hope you guys enjoy, and best of luck out there!
GBPJPY BUY TRADE Oct 8 2024This trade comes to fruition after checking for manipulation of lows using 4H-1H-30min-15min.
Allowing me to activate the said pending order -Buy limit during London session (metatrader 4 platform) . I marked that demand because using the order flow, I can see enough evidence to go long. Risking 0.5% of the capital. Every trade that I initiate comes from the basic idea of supply and demand.
(please check the attached charts for a detailed structure of entry and exit points)
Always be patient and look for proof before you put pending order.
Creating a Balanced Investment PortfolioCreating a Balanced Investment Portfolio
In the vast realm of trading, where platforms like FXOpen play a pivotal role, strategy and skill stand paramount. As the age-old adage goes, 'Don't put all your eggs in one basket.' In the context of trading, this underscores the significance of diversification. Enter the concept of a balanced investment portfolio - an excellent balanced portfolio example, which emerges as an oasis of hope amidst the unpredictable dunes of market volatility.
Understanding the Importance of a Balanced Investment Portfolio
To achieve a balanced investment portfolio, it's crucial to consider the balance of individual components, especially forex, CFDs, stocks, and bonds. For example, a stock portfolio balance refers to the proportion of stocks in relation to other investment types. This balance is pivotal, as stocks often carry higher risks but also higher potential rewards. By understanding their own risk tolerance and learning how to balance portfolio assets effectively, traders can determine the ideal portfolio balance that meets their specific objectives.
Building the Foundation: Investment Basics
Every experienced trader knows that the world of investments is vast, presenting myriad opportunities. Some of the primary investment types include:
- Stocks: These signify ownership in a company and constitute a claim on a fraction of its assets and earnings.
- Bonds: Essentially, when you invest in bonds, you're loaning your money, either to a corporation or the government, in exchange for periodic interest payments plus the return of the bond's face value when it matures.
- Real Estate: Investing in tangible land, buildings, or housing. Given its physical nature, it often acts as a hedge against more volatile markets.
- Mutual Funds: These funds pool money from several investors to invest in a diversified portfolio of stocks, bonds, or other securities.
Central to investment basics is the risk-return tradeoff. Essentially, it highlights that the potential return on any investment is directly proportional to the risk associated with it. In this matrix, diversification emerges as the most effective strategy, helping to spread and, in turn, mitigate risk.
Asset Allocation Strategies
Asset allocation might seem like a complex term, but at its core, it's about ensuring that your portfolio reflects your investment portfolio balance, harmonising your desired risk and reward.
1. Modern Portfolio Theory (MPT)
Introduced by the visionary economist Harry Markowitz in the 1950s, the Modern Portfolio Theory (MPT) has since established itself as a seminal concept in portfolio management. Groundbreaking for its time and still influential today, MPT hinges on a principle that feels intuitive yet was revolutionary upon its debut: diversifying investments to maximise returns while judiciously managing the associated market risk. Central to the MPT is the construct of the 'Efficient Frontier'.
This captivating concept represents a boundary in the risk-return space where portfolios lie if they offer the highest expected return for any given level of risk. In essence, any portfolio residing on the Efficient Frontier is deemed optimal, reflecting a balance where no additional expected return can be achieved without accepting more risk.
2. Strategic Asset Allocation
Here, traders establish a base policy mix — a proportional combination of assets based on expected rates of return for each asset class. It’s a long-haul game, adjusting the portfolio as long-term goals or risk tolerance evolve.
3. Tactical Asset Allocation
A more active management portfolio strategy, this method tries to exploit short-term market conditions. It involves shifting percentage holdings in different categories to take advantage of market pricing anomalies or strong market sectors.
Diversification
In the complex world of investing, understanding how to balance a portfolio is key. Diversification is the guardian against unpredictability. It is the art of spreading investments across various assets or sectors, ensuring that potential adverse events in one area won't unravel the entire portfolio's performance. Essentially, diversification is the protective shield that buffers against market volatility, offering a more stable and consistent growth path for traders.
Geographical Diversification
Globalisation has knit economies closer than ever before, yet each retains unique characteristics influenced by internal and external events. By diversifying investments across continents and countries, traders can leverage these unique attributes.
Sector Diversification
Beyond geography, the global market is segmented into various sectors — technology, healthcare, and finance, to name a few. Each has its growth trajectory, impacted by different factors. Spreading investments across sectors can hedge against unforeseen adversities.
Individual Asset Selection
The keystone of a robust portfolio is the judicious choice of individual assets. Beyond the broad strokes of diversification, the meticulous selection of each asset determines the portfolio's potential success. It's where profound understanding meets strategic decision-making, ensuring that every asset, be it a stock, bond, or commodity, is handpicked to serve the trader's overarching goals and vision. Proper research, encompassing financial performance, management quality, growth potential, and market trends, provides insight, reducing the chances of unwelcome surprises.
Risk assessment is another crucial part of individual asset selection. Risk is an inherent part of investing. However, with rigorous risk assessment, traders can anticipate potential pitfalls. Evaluating the risk associated with each asset and its correlation with others in the portfolio helps in achieving the desired balance.
Monitoring and Rebalancing
In the dynamic dance of markets, continuous oversight and timely adjustments keep a portfolio's rhythm and harmony intact.
- Regular Portfolio Review. The world doesn't stand still, nor do the markets. Regular reviews ensure that the portfolio aligns with the trader's goals and market realities.
- Rebalancing Strategies. Over a period of time, certain investments will experience more rapid growth than others. This can shift the portfolio’s balance, necessitating rebalancing. Rebalancing, whether by reinvesting dividends or selling assets that have appreciated to buy those that have declined, ensures alignment with the desired risk levels and asset allocation strategy.
Conclusion
Crafting a balanced trading portfolio is an art backed by science, strategy, and due diligence. It's an ongoing process requiring constant monitoring and fine-tuning. By keeping a finger on the pulse of global trends, understanding risks, and staying committed to their goals, traders can navigate the choppy waters of global markets effectively. For those eager to embark on or deepen their trading journey, FXOpen offers the platform and tools. To initiate this exciting endeavour, you can open an FXOpen account and explore the dynamic offerings of the TickTrader platform.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Understanding Warren Buffett’s Investment PhilosophyWarren Buffett is arguably one of the most successful investors of all time. Over the years, he has developed a set of principles and strategies over his career. He was inspired by the teachings of key financial thinkers like Phil Fisher, Benjamin Graham and Charlie Munger.
Key Influences
Phil Fisher
Fisher’s approach focusses on quality companies with long-term growth potential, emphasizing focused portfolios and long-term holdings. He believed in gathering information about a company beyond what’s readily available. His lessons on maintaining a focused portfolio and committing to long-term holdings are clear influences on Buffett’s patient, value-driven investment philosophy.
Benjamin Graham
Known as the father of value investing, Graham’s core principle was to buy stocks at a price lower than their intrinsic value, creating a margin of safety (MOS). This strategy helps mitigate risk and increase the likelihood of future gains. Buffett absorbed Graham’s teaching on finding stocks that are undervalued and buying them at the right price— definitely a large contributor of his investment success.
Charlie Munger
Munger is Warren Buffett’s long-time business partner. He introduced the concept of economic moats, which refers to a company’s long-term, sustainable competitive advantages. Munger advocates investing in businesses that can fend off competition and maintain profitability over time. This philosophy drives Buffett’s focus on companies with strong market positions and solid long-term potential, favoring these over shorter-term, speculative opportunities.
Buffett's Investment Approach
1 - Buy for the Long Term. Buffett’s strategy emphasizes identifying companies that can consistently perform well over long periods. He holds stocks for years, or even decades, often looking for opportunities where other investors may overlook value.
2 - Buy at the Right Price . Buffett is known for his discipline in waiting for the right moment to invest. His approach ensures he doesn’t overpay, instead seeking stocks when they are priced below their true value, maintaining a margin of safety.
3 - Buy the Right Stocks . Buffett doesn’t just buy cheap stocks, he buys quality companies with sustainable advantages. His goal is to invest in firms with strong business models that will continue to perform well regardless of market conditions.
Warren Buffett emphasizes investing in companies with simple and clear business models , ones that fall within his circle of competence. He prefers to thoroughly understand the operations, products, and long-term prospects of a company before making any investment.
This principle is combined with in-depth analysis of how the company operates and how sustainable its valuations and future growth prospects are. If a business model is too complex or outside his expertise, he avoids it.
He prioritizes companies with integrity and transparency in their management. He believes in backing leaders who are passionate, have strong vision and execution capabilities and who use shareholder funds wisely. Trusting management to run the company effectively, with efficiency and accountability, is critical for long-term success in Buffett’s eyes.
Investing in quality companies isn’t enough—Buffett also insists on buying them at attractive prices. He maintains a strict discipline of buying with a margin of safety, ensuring the price paid is lower than the company’s intrinsic value. This means waiting for opportunities to buy great businesses at fair prices rather than settling for fair businesses at attractive prices , which may not perform well over time.
Buffett has made many of his lessons and strategies available to the public through his letters to shareholders and partnership letters. These documents offer insight into his investment approach, decision-making process, and lessons from both successes and failures. There are several key books that capture Buffett’s life, philosophy, and strategies in greater detail:
Warren Buffett’s Ground Rules
The Warren Buffett Way
Buffett: The Making of an American Capitalist
The Warren Buffett Portfolio
The Snowball: Warren Buffett and the Business of Life
Each of these resources provides a comprehensive look into the mind of one of the most successful investors of all time, offering practical advice and detailed case studies of his investments.
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Simple Portfolio Management StrategiesSimple Portfolio Management Strategies
In financial market systems, where complexity often obscures the path to effective trading and investing, there can still be clarity and certainty based on the use of simple portfolio management strategies. In this FXOpen article, you will learn about portfolio meaning in investment and how to manage it.
Investment Portfolio: Fundamentals
When talking about portfolio management, the investment portfolio definition often comes to mind. However, portfolio management can be an effective technique not only for investors but also for medium- and long-term traders.
The traditional definition states that an investment portfolio is a carefully selected collection of assets, such as stocks, bonds, indices, commodities, real estate and more, owned by an individual. This collection is not just a random assortment — it is selected strategically with the aim of achieving specific financial goals while managing risks.
An investment portfolio is not static. It responds to market conditions, economic shifts, and personal goals. Therefore, it’s vital to have various portfolio management strategies in place to adapt to market conditions.
Although traders don’t own the assets they trade, if they hold positions for days, weeks, or even months, they can also implement the following strategies.
In trading and investing, complexity can be a hidden adversary. Overly intricate portfolio management strategies typically lead to confusion and missed opportunities. Yet, simplicity brings clarity. Having a clear path for making well-informed decisions helps reduce stress and improve your performance.
And there is a great benefit in simple strategies. Clear and easy-to-follow investment portfolio management strategies empower investors to navigate this fast-paced realm with confidence.
The Concept of Equal Weight Allocation
Equal weight allocation means dividing your investments equally among the different assets in your portfolio. This is made to sidestep the trap of putting all your eggs in one basket. This strategy minimises the impact of any single asset’s performance on your overall portfolio.
Advantages
Equal weight allocation offers a panoramic view of the market. Distributing your investments helps you gain exposure to diverse assets, reducing vulnerability to market swings. It’s a balanced approach.
Considerations
Equal weight allocation doesn’t consider individual asset performance or risk. This means that the loss in one asset may exceed the income from another, but for traders who value a straightforward path, this option works.
The Main Ways to Diversify
Think of diversification as your safety net. This strategy involves spreading your investments across various assets, making your portfolio resilient to turbulence. If one falters, others pick up the slack, minimising the potential losses.
Modern Portfolio Theory (MPT)
MPT is one of the approaches to diversification. It’s like assembling the perfect puzzle, optimising your portfolio based on your risk tolerance and the desired return. The theory suggests that investors are risk-averse, so the main task is to boost profits with minimal risks. This approach makes your fund allocation harmonious.
Sector and Industry Diversification
There is an opinion that the diversification of sectors and industries is a fine art, but you can definitely learn it if you read a lot and track market changes. By allocating your investments to sectors that work differently in various conditions, you further reduce the risk.
For example, you can consider the combination of the technology industry with healthcare or oil and gas companies with the agro-industry. One of the ideas is to choose those assets that act as counterweights.
Advantages
Spreading investments across different asset classes minimises the impact of a poor-performing asset. This helps to stabilise the portfolio during market fluctuations. Diversification allows exposure to multiple sectors, industries, and regions, increasing the chances of benefiting from emerging trends.
Considerations
Holding too many assets can lead to increased complexity in portfolio management. Managing a portfolio requires regular monitoring and adjustments. Also, it’s vital to know how to choose assets that are negatively correlated, as if assets are positively correlated, they will move in a similar direction even when your price predictions are incorrect.
On our TickTrader platform, you’ll find multiple instruments that help our clients analyse market trends and diversify correctly. Trading several markets on one single platform is simple and convenient.
The Dollar Cost Averaging (DCA) Strategy
Dollar-cost averaging means investing a certain amount regularly, regardless of market ups and downs. The strategy involves reducing the impact of volatility by dividing the entire amount of investments into parts that are invested according to a predetermined schedule. This is a reasonable step aimed at mitigating the effects of market volatility.
Advantages
DCA turns market fluctuations into its ally, allowing you to accumulate more when prices are low and less when they are high. The strategy provides psychological relief from consistent investment.
Considerations
DCA might miss out on rapid market upswings, but by and large, this is a strategy of balance and moderation, mitigating the effects of market volatility.
Portfolio Rebalancing
Portfolio rebalancing is the practice of adjusting your portfolio back to its original allocation. Think of your investment portfolio as a garden. Just as plants grow at different rates, the assets in your portfolio can change over time. Rebalancing a portfolio is like tending your garden, making sure that no one plant overwhelms the others.
It’s a strategic process of changing your investments to maintain the desired mix of assets. In real life, it would look like this: Suppose you set a goal to have 60% stocks and 40% indices in your portfolio. If the number of stocks rises to 70% due to market trends, rebalancing will bring them back to 60%, and you can reinvest them in indices.
In a trading portfolio, you can set precise targets for risky and risk-averse assets, control the number of positions in both groups and rebalance depending on the market conditions.
Why Rebalance?
Market fluctuations can upset the balance of your portfolio. Rebalancing prevents one asset from dominating and helps to manage risks. This brings your portfolio in line with your goals and risk tolerance.
The easiest way to restore balance is to set regular intervals. You adjust your investments according to your original plan. This ensures that your portfolio stays the same without overly complicating the situation. When buying and selling, keep in mind the potential costs and taxes. Rebalancing should not outweigh the benefits.
Advantages
Rebalancing ensures that your portfolio stays in line with your initial asset allocation, preventing it from drifting due to market changes. It also helps prevent the portfolio from becoming overly concentrated in a single asset class.
Considerations
Deciding when and how often to rebalance can be challenging, as overreacting to short-term market movements may hinder long-term performance. Additionally, frequent rebalancing can lead to increased trading costs.
Final Thoughts
With portfolio management techniques, traders learn to use different strategies and diversify their portfolios. And here, simple methods underpin sound decision-making. Traders choose strategies that suit their goals, styles, and risk tolerance. You can open an FXOpen account to start your journey. As you use the power of simplicity, you will be ready to master portfolio management and improve your trading.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Tata TechEnter NSE:TATATECH at CMP, with an SL of 1010.
It seems that this gem from the Tata Sons empire is on the verge of an up-move in the coming weeks.
Those willing to hold it for longer horizons may hold it till a close below 971.4, post which must take an exit.
The formation of a reversal pattern post a prolonged downtrend, along with presence of a valid trendline with upto 4 touchpoints, makes this a significant breakout.
This may also be a good time to allocate to this stock, from a longer term standpoint.
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This is for illustrative purposes only. Do not construe this as investment advice
FTM/USDT Weekly Key Notes: Prime Long OpportunityThe chart is looking exceptionally promising for a spot trader like me—perfect for a long position from this key level. The market is bouncing off and showing strong reversal momentum, and I’m feeling optimistic about FTM. My targets might seem a bit ambitious, but the technicals on this chart seem to back up my enthusiasm. It’s an excellent chance to fill your bags. I’ll be referring back to this post in the future, and if you miss out, I might just rub it in—though if it doesn’t work out, I might end up needing a basement to live in! Jokes aside, the coin looks set for a strong uptrend in the near future. I’m also highlighting key entry levels for long traders.
Best of luck!
$BABA | Allocation & Watchlist | Market Exec & Buy Stops |Technical Confluences:
- Price action has been consolidating between a Wedge pattern
- Price action is at a Demand Zone of all-time lows
- Price is starting to slowly break above the 200MA
- A break above the resistance trendline (been a good support/resistance TL) would be a significant move.
Fundamental Confluences:
- Considerably cheap valuations
- Still one of the largest e-commerce players, don't see it dropping it off anytime soon
- China's economy has been weakening and we are seeing efforts by the China government to help boost back the domestic economy. Potential for revenue boost.
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Putting in my first tranche of NYSE:BABA allocation for my Long-Term portfolio.
Gonna be holding this share for years and will continue adding position with Buy Stop orders.
Remember, DYOR.
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Boosts 🚀, Follows ✌️, Shares 🙌 & Comments ✍️ are much appreciated!
If you have any ideas or charts, do share them in the 'Comments' section below and we can discuss our perspectives to improve or strengthen our strategies.
If you want something analyzed, do drop me a DM. :D
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Disclaimer: The above suggestion is an personal opinion in general and does not constitute as investment advice. Any decisions taken based on the above suggestion is purely your own risks. DYOR.
$SPY | Watchlist D1 | Buy Limit |Technical Confluences:
- Recent Elliott wave count shows that we are now in a Wave 4 retracement
- Price action seemed to have topped out at the 50% Fibo Extension for now (Ending Wave 3)
- Price action may test the Supply Zone again before retracing downwards towards the Horizontal Trendline and the 38% or 50% Retracement Fibo
Fundamental Confluences:
- US economic outlook is weak currently and valuations needs to normalize before we make a new high
- Businesses are suffering from high interest rate environment and for the FED to cut, growth needs to show definite weakness, which we are starting to see.
- A FED cut will not instantly improve business prospects again as interest rate changes takes time to seep into the economy
- Investors will also be wary about the upcoming elections as government policies may affect business activities
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Watching the Demand Zones as levels to begin some of my portfolio allocation into AMEX:SPY
Will place my Buy Limit orders for the it.
Remember, DYOR.
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Boosts 🚀, Follows ✌️, Shares 🙌 & Comments ✍️ are much appreciated!
If you have any ideas or charts, do share them in the 'Comments' section below and we can discuss our perspectives to improve or strengthen our strategies.
If you want something analyzed, do drop me a DM. :D
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Disclaimer: The above suggestion is an personal opinion in general and does not constitute as investment advice. Any decisions taken based on the above suggestion is purely your own risks. DYOR.
$CELH | Buy Potential D1 | Market Exec | Technical Confluences:
- Elliot wave may have completed Wave 4 and begin the Wave 5 move
- Price action is close to the 78% Fibo levels and a Demand zone (Yellow Zone) area.
- Stochastics are at Oversold levels on both Weekly & Daily timeframes (TF)
Fundamental Confluences:
- Earnings was positive with both domestic & international revenue increasing, EPS beat, EBITDA also up
- Slowly gaining market share in the Energy drinks segment
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I see these levels as good for me to being some allocation of my Portfolio into $CELH.
Blue Zones & Fibo Extension levels (in Blue) will be the starting point of some my TP levels.
Remember, DYOR.
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Boosts 🚀, Follows ✌️, Shares 🙌 & Comments ✍️ are much appreciated!
If you have any ideas or charts, do share them in the 'Comments' section below and we can discuss our perspectives to improve or strengthen our strategies.
If you want something analyzed, do drop me a DM. :D
________________________________
Disclaimer: The above suggestion is an personal opinion in general and does not constitute as investment advice. Any decisions taken based on the above suggestion is purely your own risks. DYOR.
Currency State Of Play - Midweek Portfolio Selection**Sorry about the sound**
Today, I'm looking at the Major Indices to determine the current state of play of the currency market and what we should expect for the remainder of the trading week.
The current 4HR wave structure analysis of the Indices is as follows:
DXY: +ve
EXY: Neutral
AXY: Neutral
SXY: +ve
JXY: +ve
BXY: -ve
CXY: -ve
ZXY: -ve
BUY PAIRS: No High probability Pairings based on the Indices
SELL PAIRS: GBPUSD, GBPJPY, CADJPY, NZDUSD,NZDJPY, CADCHF,GBPCHF
Buy low sell fast strategyThe main idea of the strategy is that in the event of a sharp unexpected drop, coins usually grow back quite quickly. We simply draw a short SMA, and when the price deviates significantly from it, we buy, and when it returns, we sell.
We cannot buy every drop; it must be quite strong and sharp. If you buy early, you can buy at the beginning of a downtrend and sit in the position for a long time. Trying to buy very low will result in few trades.
However, you can trade several coins at the same time, and if you choose the parameters, you can get a stable profit.
What's in a Trading Plan? Here's All You Need to Include.Ready, set… plan? In this guide, we discuss why you need to plan your trading before trading your plan. Let’s roll.
Table of Contents:
»Importance of a Trading Plan
»The Successful Trading Plan Doesn't Exi...
»What's in a Typical Trading Day?
»Markets, Strategies and Styles
»Summary
Venturing into trading without a plan is akin to setting sail on the ocean without a compass. Or taking the leap without looking first 😉. We can keep the metaphors rolling but if there’s one thing you must remember from this word salad of an article, it’s this: success in trading is possible with a plan. Without a plan, not so much.
In this guide, we'll talk about the importance of creating a trading plan, what you should include in it, and how to follow it.
📍 Importance of a Trading Plan
A trading plan is not just a list of dos and don’ts; it's the roadmap to trading success. Here's why it matters:
➡️ Streamlines Your Actions : Much like a roadmap, a trading plan outlines your objectives, time frames, strategies, and risk management techniques, and offers a clear path forward.
➡️ Limits Emotional Swings : By defining rules and parameters in advance, a trading plan helps to keep emotions in check, limiting impulsive actions that could lead to financial pitfalls.
➡️ Fosters Discipline : Sticking to a plan holds you accountable for your actions and allows you to see where you jump out of your rule book and into undisciplined FOMO-driven pump-chasing revenge trading.
📍 The Successful Trading Plan Doesn't Exi...
Many traders believe that you can be successful by buying and selling random selections of stocks, forex pairs, or commodities. However, the reality is that the most — if not all — successful traders have one thing in common: a well-defined trading plan. Here's what makes for a successful trading plan:
☝🏽 Adaptability : A successful trading plan is not rigid but flexible, allowing for adjustments in response to changing market conditions.
☝🏽 Consistency : A plan helps you stay on track toward your goals as a trader, allowing you to stick to predefined rules and strategies, especially when things get hot and volatile.
☝🏽 Continuous Improvement : A successful trading plan is a work in progress. The more time you use it, the higher probability you will have to refine it as you drift along diverse assets, all swayed by different factors.
📍 What's in a Typical Trading Day?
A typical trading day is a blend of preparation, execution, and reflection. And while you should leave room for new ideas, fresh approaches, and some surprises, there are mainstay components that you need to have in your trading plan.
📰 Reading the News : Staying in the know is always a good idea. For many successful traders, the first thing to do is check what’s the latest on the news front. Known as fundamental analysis, reading the news and doing your research will help you get a sense of investor sentiment.
Moreover, you can stay ahead of the curve and anticipate big market moves by following the economic calendar. Lots of those sharp swings you see in forex or stocks are caused by regular data dumps such as the monthly US nonfarm payrolls report. The Federal Reserve’s decisions on interest rates or the monthly Consumer Price Index are also keys to anticipating volatility.
And what better place to follow all that’s moving markets than the TradingView News section ?
📈 Following the Charts : if you’re here, this one won’t be too new to you. Chart reading, known as technical analysis, is one of the oldest ways to analyze anything — from stocks to crypto and even frozen orange juice.
Think of a chart as your trading canvas. It’s your space to be creative, draft ideas, look for technical patterns and formations, and anticipate potential moves. Observing the chart and watching how prices behave will help you spot where a trend may form, extend, or reverse.
Some of the most popular technical formations include double tops and bottoms, head and shoulders, cup and handle, and more. And some of the most popular technical indicators include the Simple Moving Average (SMA), the Relative Strength Index (RSI), and the Fibonacci sequence.
All of that, and much more, is readily available for you almost anywhere you click on the TradingView platform.
⚒️ Work on Your Skills : Trading doesn’t have to glue you to the screen in constant monitoring of every blip. If you don’t see anything to trade, don’t trade just for the sake of it. Sometimes the best trading position is no position at all.
Instead, use some of your idle time to build out your knowledge base. Grab some books on technical analysis or trading psychology. Or watch interviews of successful traders and investors and gain that educational edge to help you become a more aware, informed, and confident trader.
🏖️ Take a Break : Not everything you do needs to be related to productivity gains and trading improvement. Stare into space or read a great novel. Take your mind off trading and unwind, let the steam off, and recharge your batteries.
Go out, enjoy a walk or do some people-watching. Taking time to zone out every now and then will help you get back to trading sharper, smarter, and more balanced.
📍 Markets, Strategies and Styles
The world of trading is as diverse as it is dynamic, offering a flurry of markets, strategies, and trading styles to explore. Here's a glimpse into the landscape:
💹 Markets : Traders can choose from a variety of financial markets, including stocks , forex , and cryptocurrencies , each with its unique characteristics and opportunities.
When you set out to create your trading plan, think carefully whether you want your portfolio to be concentrated into any one market or asset class. Or maybe you’d like to go for a diverse approach to trading and pull in assets from several markets.
Knowing what your asset preference is will help you phase out markets so they don’t distract you.
🎯 Strategies : From technical analysis to fundamental analysis, you can adopt various strategies to identify trading opportunities and manage risk, ranging from trend following to mean reversion.
News trading is a popular approach to markets as it allows you to bet on economic reports, geopolitical events, central bank updates, and more. On the other hand, technical traders tend to stick to the chart in efforts to gauge price movements and trends. Every chart tells a story. Deciphering it is the tough part.
🌈 Styles : Trading styles are equally important and they’re all tied to a specific time frame of holding your positions. If you’re more into short-term trading, you may pick scalping and target a few pips of gains before jumping out of your trade.
Day trading and swing trading are two popular time-sensitive trading strategies that you may want to explore when building out your trading plan.
📍 Summary
Your trading plan should be exactly that — yours. Tailor it to your specific goals, risk orientation, asset preference, and find out how it stacks up against market conditions.
That way, you can navigate the markets with confidence and direction, instead of letting markets sway your decision making and lead you into uncharted waters. Embark on your trading journey armed with a well-crafted plan, and let it be your roadmap to trading success.
📣With that said, let us know in the comments: do you have a trading plan? What’s the most important element of it and are you always sticking to it?
Long term Investment Idea | Sharda Crop | 100% Upside Potential Long term Investment Idea | NSE:SHARDACROP | 100% Upside Potential
✅ Sharda Cropchem CMP - Rs 333
✅ Promoter holding 74.8 %
✅ Company is almost debt free.
✅ Good sales growth over 3-5 years.
✅ Company has good capex and global presence
The negative profit growth observed in companies like UPL, MOL, and Deepak Fertilizers suggests a broader sectoral trend, as similar trends in sales and OPM are evident across all agrochemical stocks.
Valuation is attractive and good to buy/accumulate for Mid to Long term gain from CMP
✅ Add more at Rs 320-300.
The sector is out of flavour and can provide a good contra bet. If good monsoon can further help in earnings.
Targets as per chart drawings.
Thanks
Diversification: What It Is, Why It Matters & How to Do ItDiversification is a market strategy that enables you to spread your money across a variety of assets and investments in pursuit of uncorrelated returns, hedging, and risk control.
Table of Contents
What is portfolio diversification?
Brief history of the modern portfolio theory
Why is diversification important?
An example of diversification at work
How to diversify your portfolio
Components of a diversified portfolio
Build wealth through diversification
Diversification vs concentration
Summary
📍 What is portfolio diversification?
Portfolio diversification is the strategy of spreading your money across diverse investments in order to mitigate risk, hedge and balance your exposure in pursuit of uncorrelated returns. While it may sound complex at first, portfolio diversification could be your greatest strength when you set out to trade and invest in the financial markets.
As a matter of fact, once you immerse yourself into the markets, you will be overwhelmed by the wide horizons waiting for you. That’s when you’ll need to know about diversification.
There are thousands of stocks available for trading, dozens of indices, and a sea of cryptocurrencies. Choosing your investments will invariably lead to relying on diversification in order to protect and grow your money.
Diversifying well will enable you to go into different sectors, markets and asset classes. Together, all of these will build up your diversified portfolio.
📍 Brief history of the modern portfolio theory
“ Diversification is both observed and sensible; a rule of behavior which does not imply the superiority of diversification must be rejected both as a hypothesis and as a maxim. ” These are the words of the father of the modern portfolio theory, Harry Markowitz.
His paper on diversification called “Portfolio Selection” was published in The Journal of Finance in 1952. The theory, which helped Mr. Markowitz win a Nobel prize in 1990, posits that a rational investor should aim to maximize their returns relative to risk.
The most significant feature from the modern portfolio theory was the discovery that you can reduce volatility without sacrificing returns. In other words, Mr. Markowitz argued that a well-diverse portfolio would still hold volatile assets. But relative to each other, their volatility would balance out because they all comprise one portfolio.
Therefore, the volatility of a single asset, Mr. Markowitz discovered, is not as significant as the contribution it makes to the volatility of the entire portfolio.
Let’s dive in and see how this works.
📍 Why is diversification important?
Diversification is important for any trader and investor because it builds out a mix of assets working together to yield returns. In practice, all assets contained in your portfolio will play a role in shaping the total performance of your portfolio.
However, these same assets out there in the market may or may not be correlated. The interrelationship of those assets within your portfolio is what will allow you to reduce your overall risk profile.
With this in mind, the total return of your investments will depend on the performance of all assets in your portfolio. Let’s give an example.
📍 An example of diversification at work
Say you want to own two different stocks, Apple (ticker: AAPL ) and Coca-Cola (ticker: KO ). In order to easily track your performance, you invest an equal amount of funds into each one—$500.
While you expect to reap handsome profits from both investments, Coca-Cola happens to deliver a disappointing earnings report and shares go down 5%. Your investment is now worth $475, provided no leverage is used.
Apple, on the other hand, posts a blowout report for the last quarter and its stock soars 10%. This move would propel your investment to a valuation of $550 thanks to $50 added as profits.
So, how does your portfolio look now? In total, your investment of $1000 is now $1,025, or a gain of 2.5% to your capital. You have taken a loss in Coca-Cola but your profit in Apple has compensated for it.
The more assets you add to your portfolio, the more complex the correlation would be between them. In practice, you could be diversifying to infinity. But beyond a certain point, diversification would be more likely to water down your portfolio instead of helping you get more returns.
📍 How to diversify your portfolio
The way to diversify your portfolio is to add a variety of different assets from different markets and see how they perform relative to one another. A single asset in your portfolio would mean that you rely on it entirely and how it performs will define your total investment result.
If you diversify, however, you will have a broader exposure to financial markets and ultimately enjoy more probabilities for winning trades, increased returns and decreased overall risks.
You can optimize your asset choices by going into different asset classes. Let’s check some of the most popular ones.
📍 Components of a diversified portfolio
Stocks
A great way to add diversification to your portfolio is to include world stocks , also called equities. You can look virtually anywhere—US stocks such as technology giants , the world’s biggest car manufacturers , and even Reddit’s favorite meme darlings .
Stock selection is among the most difficult and demanding tasks in trading and investing. But if you do it well, you will reap hefty profits.
Every stock sector is fashionable in different times. Your job as an investor (or day trader) is to analyze market sentiment and increase your probabilities of being in the right stock at the right time.
Currencies
The forex market , short for foreign exchange, is the market for currency pairs floating against each other. Trading currencies and having them sit in your portfolio is another way to add diversification to your market exposure.
Forex is the world’s biggest marketplace with more than $7.5 trillion in daily volume traded between participants.
Unlike stock markets that have specific trading hours, the forex market operates 24 hours a day, five days a week. Continuous trading allows for more opportunities for price fluctuations as events occurring in different time zones can impact currency values at any given moment.
Cryptocurrencies
A relatively new (but booming) market, the cryptocurrency space is quickly gaining traction. As digital assets become increasingly more mainstream, newcomers enter the space and the Big Dogs on Wall Street join too , improving the odds of growth and adoption.
Adding crypto assets to your portfolio is a great way to diversify and shoot for long-term returns. There’s incentive in there for day traders as well. Crypto coins are notorious for their aggressive swings even on a daily basis. It’s not unusual for a crypto asset to skyrocket 20% or even double in size in a matter of hours.
But that inherent volatility holds sharpened risks, so make sure to always do your research before you decide to YOLO in any particular token.
Commodities
Commodities, the likes of gold ( XAU/USD ) and silver ( XAG/USD ) bring technicolor to any portfolio in need of diversification. Unlike traditional stocks, commodities provide a hedge against inflation as their values tend to rise with increasing prices.
Commodities exhibit low correlation with other asset classes, too, thereby enhancing portfolio diversification and reducing overall risk.
Incorporating commodities into a diversified portfolio can help mitigate risk, enhance returns, and preserve purchasing power in the face of inflationary pressures, geopolitical uncertainty and other macroeconomic risks.
ETFs
ETFs , short for exchange-traded funds, are investment vehicles which offer a convenient and cost-effective way to gain exposure to a number of assets all packaged in the same instrument. These funds pull a bunch of similar stocks, commodities and—more recently— crypto assets , into the same bundle and launch it out there in the public markets. Owning an ETF means owning everything inside it, or whatever it’s made of.
ETFs typically have lower expense ratios compared to mutual funds, making them affordable investment options.
Whether you seek broad market exposure, niche sectors, or thematic investing opportunities, ETFs are a convenient way to build a diversified portfolio tailored to your investment objectives and risk preferences.
Bonds
Bonds are fixed-income investments available through various issuers with the most common one being the US government. Bonds are a fairly complex financial product but at the same time are considered a no-brainer for investors pursuing the path of least risk.
Bonds have different rates of creditworthiness and maturity terms, allowing investors to pick what fits their style best. Bonds with longer maturity—10 to 30 years—generally offer a better yield than short-term bonds.
Government bonds offer stability and low risk because they’re backed by the government and the risk of bankruptcy is low.
Cash
Cash may seem like a strange allocation asset but it’s actually a relatively safe bet when it comes to managing your own money. Sitting in cash is among the best things you can do when stocks are falling and valuations are coming down to earth.
And vice versa—when you have cash on-hand, you can be ready to scoop up attractive shares when they’ve bottomed out and are ready to fire up again (if only it was that easy, right?).
Finally, cash on its own is a risk-free investment in a high interest-rate environment. If you shove it into a high-yield savings account, you can easily generate passive income (yield) and withdraw if you need cash quickly.
📍 Build wealth through diversification
In the current context of market events, elevated interest rates and looming uncertainty, you need to be careful in your market approach. To this end, many experts advise that the best strategy you could go with in order to build wealth is to have a well-diversified portfolio.
“ Diversifying well is the most important thing you need to do in order to invest well ,” says Ray Dalio , founder of the world’s biggest hedge fund Bridgewater Associates.
“ This is true because 1) in the markets, that which is unknown is much greater than that which can be known (relative to what is already discounted in the markets), and 2) diversification can improve your expected return-to-risk ratio by more than anything else you can do. ”
📍 Diversification vs concentration
The opposite of portfolio diversification is portfolio concentration. Think about diversification as “ don’t put your eggs in one basket. ” Concentration, on the flip side, is “ put all your eggs in one basket, and watch it carefully. ”
In practice, concentration is focusing your investment into a single financial asset. Or having a few large bets that would assume higher risk but higher, or quicker, return.
While diversification is a recommended investment strategy for all seasons, concentration comes with bigger risks and is not always the right approach. Still, at times when you have a high conviction on a trade and have thoroughly analyzed the market, you may decide to bet heavily, thus concentrating your investment.
However, you need to be careful with concentrated bets as they can turn against your portfolio and wreck it if you’re overexposed and underprepared. Diversification, however, promises to cushion your overall risk by a carefully balanced approach to various financial assets.
📍 Summary
A diversified portfolio is essentially your best bet for coordinated and sustainable returns over the long term. Choosing a mix of various types of investments, such as stocks, ETFs, currencies, and crypto assets, would spread your exposure and provide different avenues for growth potential. Not only that, but it would also protect you from outsized risks, sudden economic shocks, or unforeseen events.
While you decrease your risk tolerance, you raise your probability of having winning positions. Regardless of your style and approach to markets, diversifying well will increase your chances of being right. You can be a trader and bet on currencies and gold for the short term. Or you can be an investor and allocate funds to stocks and crypto assets for years ahead.
Potential sources of diversification are everywhere in the financial markets. Ultimately, diversifying gives you thousands of opportunities to balance your portfolio and position yourself for risk-adjusted returns.
🙋🏾♂️ FAQ
❔ What is portfolio diversification?
► Portfolio diversification is the strategy of spreading your money across diverse investments in order to mitigate risk, hedge and balance your exposure in pursuit of uncorrelated returns.
❔ Why is diversification important?
► Diversification is important for any trader and investor because it creates a mix of assets working together to yield high, uncorrelated returns.
❔ How to diversify your portfolio?
► The way to diversify your portfolio is to add a variety of different assets and see how they perform relative to one another. If you diversify, you will have a broader exposure to financial markets and ultimately enjoy more probabilities for winning trades, increased returns, and decreased overall risks.
Do you diversify? What is your strategy? Do you rebalance? Let us know in the comments.
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Divergence spotted, expect reversal. Potential +800% profit.Bullish divergence on the Relative Strength Index (RSI) indicates a promising outlook for BINANCE:COTIUSDT , suggesting a potential uptrend in the near future. This divergence typically occurs when the price of an asset moves in the opposite direction to the RSI indicator, signaling a potential shift in market sentiment.
Moreover, recent price action has shown signs of reversal, further supporting the notion of an upcoming bull run. This reversal is expected to continue its momentum, potentially driving prices higher over time.
For traders considering entry into this market, the current price stands at 0.07180, presenting an opportune moment to initiate positions. Additionally, setting clear targets can help manage expectations and guide trading strategies. The following targets are suggested:
Target-1: 0.13108
Target-2: 0.19075
Target-3: 0.33982
Target-4: 0.45786
Target-5: 0.51000
Target-6: 0.61245
Target-7: 0.69199
It's crucial to implement risk management techniques to protect capital. A suggested stop loss level is at 0.03701, which can help limit potential losses in case the trade does not unfold as anticipated.
Considering these factors, this trade opportunity presents a favorable long-term prospect with the potential for substantial gains. Traders are encouraged to conduct thorough analysis and assess their risk tolerance before making any investment decisions.
Should you have any further questions or require additional information, please feel free to reach out.
Regards,
How to Build Your Portfolio Like a Professional InstitutionInvesting at the institutional level involves a sophisticated blend of strategies, risk management, and performance measurement to achieve optimal returns. One of the cornerstones of creating an institutional-grade portfolio is the use of optimization methods, with particular focus on ratios such as the Sharpe Ratio, Sortino Ratio, and Omega Ratio. In this guide, we'll delve into what these ratios are, how they differ, and when to use each to construct a robust institutional-grade portfolio.
Understanding the Ratios
Sharpe Ratio
Definition : The Sharpe Ratio, developed by Nobel laureate William F. Sharpe, measures the performance of an investment compared to a risk-free asset, after adjusting for its risk. It is calculated by subtracting the risk-free rate from the return of the portfolio and dividing by the standard deviation of the portfolio's excess returns.
Usefulness : This ratio helps investors understand how much excess return they are receiving for the extra volatility that they endure for holding a riskier asset. A higher Sharpe Ratio indicates a more attractive risk-adjusted return.
Sortino Ratio
Definition : Similar to the Sharpe Ratio, the Sortino Ratio also measures the risk-adjusted return of an investment portfolio. However, it differs by only considering downside volatility (negative returns) rather than the total volatility of returns.
Usefulness : This focus on downside risk makes the Sortino Ratio particularly useful for investors who are more concerned about potential losses than the overall volatility. A higher Sortino Ratio indicates that the portfolio is efficiently earning more on its downside risk.
Omega Ratio
Definition : The Omega Ratio is a more comprehensive measure that divides the returns above a certain threshold (typically the risk-free rate) by the returns below that threshold. It considers all the moments of the distribution of returns, not just the first two moments (mean and variance) like the Sharpe and Sortino ratios.
Usefulness : This ratio is especially valuable for portfolios that do not follow a normal distribution of returns, providing a more holistic view of performance across different risk levels. A higher Omega Ratio indicates better performance per unit of risk.
How They Differ
The primary difference among these ratios lies in how they measure risk and returns:
Sharpe Ratio considers the total volatility (standard deviation) of portfolio returns, treating all volatility as equal.
Sortino Ratio improves on this by focusing only on downside risk, which is more relevant for investors concerned about losses.
Omega Ratio goes further by considering the entire distribution of returns, offering insights into the performance across all levels of risk.
Situational Use
Sharpe Ratio : Ideal for general comparisons of portfolio performance where the investor is concerned with both upside and downside volatility. It's particularly useful when comparing portfolios or investments with similar risk profiles. This ratio is commonly used by most large financial institutions due to the large sums of money they manage and ensuring portfolio stability is prioritized over larger profits.
Sortino Ratio : Best used when the investor's primary concern is with the downside risk rather than total volatility. This ratio is suitable for portfolios where strategies are aimed at minimizing losses rather than capturing every potential upside. This ratio is used by investors who are able to stomach more volatility in their portfolio in return for a higher probability of gains while effectively reducing equity downside.
Omega Ratio : Most beneficial for analyzing portfolios with non-normal distributions of returns, such as those including options, leveraged investments, or hedge funds. It provides a nuanced view of performance across different levels of risk, making it suitable for sophisticated investment strategies that aim to manage risk in a more granular manner. Due to the nature of this ratio, only investors who have a larger risk appetite and require aggressive growth should use this ratio as the omega ratio will not necessarily be affected by high portfolio drawdowns as long as the runups are significantly higher. This means a portfolio could experience a 60% drawdown, followed by a 1000% runup, and the Omega Ratio calculation would return a high value as the probability of gains still outweigh the probability of losses.
Conclusion
Constructing an institutional-grade portfolio requires a nuanced understanding of both the opportunities and risks present in the investment landscape. By leveraging the Sharpe, Sortino, and Omega ratios, investors can better assess the risk-adjusted performance of their portfolios, tailoring their investment strategies to meet specific risk and return objectives. Whether you're managing a conservative fund focused on minimizing losses or a dynamic portfolio seeking to capitalize on market inefficiencies, these ratios provide critical insights that can help optimize your investment approach for superior risk-adjusted returns.
SOL/USDT Market Correction OpportunitiesWe are considering a scenario involving the decline in the SOL's value and the initiation of asset purchases.
It is worth noting that the current correction to the $79.60 level represents a deviation of more than 37% from the prevailing local peak at $126.21. The price movement chart within the descending channel during the correction indicates a reduction in investment activity and profit-taking.
Given the anticipated continuation of the downward trend and considering the potential attainment of price levels around $70 and below, we are contemplating the possibility of strategically re-entering positions in SOL to optimize the portfolio and capitalize on market conditions in our favor.
