Charges and profit on trading

Typical brokerage is .3% for delivery and .03% for day trading. This is added to your buy/sell rate. Transaction and turnover Taxes are calculated post this. Over and above this, you need to pay income tax quarterly and adjust losses to gains in your annual returns.
High net worth individuals get better rates. For ex Axis bank has a scheme of .15% and .015% for a prepaid scheme. For eg you can prepay brokerage of ~1.25L for a total delivery turnover of 7Crores or 70Crores in day trading. Beyond this they charge .18% and .018% for delivery/day respectively.
 
if you are doing this for the first time I suggest you stay away from trading and take delivery of good stocks which are at lows. you will end up burning your fingers if don't exit at the right time or if you become greedy.
 
rsatbf said:
Typical brokerage is .3% for delivery and .03% for day trading. This is added to your buy/sell rate. Transaction and turnover Taxes are calculated post this. Over and above this, you need to pay income tax quarterly and adjust losses to gains in your annual returns.
High net worth individuals get better rates. For ex Axis bank has a scheme of .15% and .015% for a prepaid scheme. For eg you can prepay brokerage of ~1.25L for a total delivery turnover of 7Crores or 70Crores in day trading. Beyond this they charge .18% and .018% for delivery/day respectively.
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My strategy has been more towards short term trading and not much of intra-day trading. in virtual trading off course. I sell stocks when they reach >3% of what the actual price i bought , so this meager brokerage is not much to worry right ?

xerxes said:
if you are doing this for the first time I suggest you stay away from trading and take delivery of good stocks which are at lows. you will end up burning your fingers if don't exit at the right time or if you become greedy.
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I am basing so much of my confidence in trading with this simulation , i may be totally wrong here though. But so far , except for one bad trade (see teh screenshot) , all others have been profitable only. Or am i missing something here. Is there any better way to check the way i trading is correct ?
 
I think 3% should cover your costs and give you maybe 1-1.5% in profits. If this works for you, go for it. I dont think there is any simple formula anyone can guarantee as something that works. You will learn and refine as you go along...
 
@ naveen
1) your strategy has to eb tried in a down trending market and a choppy environment too. the market is unidirectional for the past 1 month so any strategy that is trend following will work. try baack testting it in a falling environment and a choppy period too.
2) u mentioned abt exiting at 3%. profit is a secondary goal. the primary should be risk management. how much risk wud u take for a trade. where wud u exit for a loss. etc
only when u take these things into account will you have a consistent system. also 3% is a few hrs move in a volatile stock. do u account for volatility? coz then ur strategy shud have diff goals for volatile and non volatile stocks.
your screenshot shows 37 wins out of 89. attempt to trade only if u can get >50% wins with an average win 2x of avg loss.
also get a better broker. 0.3% is ridiculous and don't ever go to any place where u pay brokerage in advance . its a losing proposition. u r depleting your account even before u begin !
 
rsatbf said:
I think 3% should cover your costs and give you maybe 1-1.5% in profits. If this works for you, go for it. I dont think there is any simple formula anyone can guarantee as something that works. You will learn and refine as you go along...
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Thanks. As i said , i will keep trading in simulation and also see if my noob strategy works on long run. Thanks.

kickass said:
@ naveen
1) your strategy has to eb tried in a down trending market and a choppy environment too. the market is unidirectional for the past 1 month so any strategy that is trend following will work. try baack testting it in a falling environment and a choppy period too.
2) u mentioned abt exiting at 3%. profit is a secondary goal. the primary should be risk management. how much risk wud u take for a trade. where wud u exit for a loss. etc
only when u take these things into account will you have a consistent system. also 3% is a few hrs move in a volatile stock. do u account for volatility? coz then ur strategy shud have diff goals for volatile and non volatile stocks.
your screenshot shows 37 wins out of 89. attempt to trade only if u can get >50% wins with an average win 2x of avg loss.
also get a better broker. 0.3% is ridiculous and don't ever go to any place where u pay brokerage in advance . its a losing proposition. u r depleting your account even before u begin !
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Yeah , as you said , i will try my strategy on all phase of the trade . I doubt my profits (virtual) are mostly due to upbeat trend.
I have no exit strategy.. If a stock is going down , it just keep it as long as possible. Since most of my investments are on small caps , loss is not that much , maximum 5-8K Rs. Thats one thing i do , buy loads of small cap stocks 🙂 thus far , all loosing stocks have come up and when such stocks come up to >3% i sell it. IIRC , OM Metals (http://www.moneycontrol.com/india/stockpricequote/engineering/ommetalsinfraprojects/OMM02) Stocks went down so much after i got the stocks , i didnt sell , i waited and it came up and sold it when it reached my threshold. I am totally new to trading and whatever i do has no real research or anything.
Volatile stocks ? Sorry for taking your time , but what are they actually ? You mean risky stocks ? As i said , i dont know anything about any stock.. Period! I also know , there is very high possibility that a bad stock buying can lock my money for a long time , if that company happens to go down and recovery will take years or so. I dont buy stocks in a company more than 50-70K or so. I get >1L worth stock on large cap , as i heard they are not prone for so much fall in price.
As for wins , all my selling has only been profitable , except for one Tranx , as it showed. I dont know why its showing 37 only as positive trades.
Also thanks for the advice on brokerage, Will keep in mind.
 

you "doubt your profits are due to upbeat trend" . there is no room for doubts and feelings. have u tested in downtrending market? what will you do if market falls for 1 month? i hope u realise that these smallcaps will collapse.
they have come up coz ur in a uptrending market. have u considered that they will fall 20-40% in a downtrend? u must realise that these stocks fall for days and weeks on end when trend changes.
if a stock falls 30% it must rise 42% to get back to its price ! ..a 50% fall implies it must double !
with no exit strategy i GUARANTEE you the profits will be wiped out and u will b stuck sooner or later. I m not discouraging you, its the law of averages. the only way to beat it is to manage risk.
managing risk implies taking a hit and exiting at predefined criteria regardless of anything. if holding stocks till they come up worked everybody wud b filthy rich 🙂
u MUST develop discipline and have a exit strategy. only then u will manage to be profitable consistently.
the right mindset is to see max risk and contain risk. focussing on profits is not the way. manage your losses, the money will flow in on its own.
and yes even the large caps fall for months and years.
 
Thanks. No , no i am not feeling discouraged. Infact i want to know how i ranoff with such profit in short time. It would be great to know now , rather than use the same thing in real market and see my money go to dust.
I will keep working iwth the virtual trading for sometime.
How can i practice these exit strategies ? Any site where i can learn ? Or any site which gives good advice on daily basis.
 
there are lots of forums where stuff is discussed regarding entries and exits. there's elitetrader, traderji, big mike and many more.
those are just discussion forums. ppl wont give out their strategies for free. it will give u an idea of what and how its done. then u need to develop stuff on your own.
. as for tips...tht garbage never works. if it did they wud be making money for themselves 😉
if u still wana do in real time then i suggest stick to 2-3k per stock max. that way if uend up wid a hit it won't be as much.- serves 2 purposes 1) keeps the pressure on u to perform at NIL. less pressure = mroe rational decisions and 2) in case of loss you wont be hit badly.
 
its not even amazing that you are making money in simulation mode , you will surely loose in real mode , simulation and reality are different
 
Maybe the simulation game intentionally makes you win in the market! I mean if everyone loses money in the simulation app, who would invest in the real market? Maybe it is just a trap!
 
simulation prices are taken from live market afaik. its just that real money is not used. so strategy should work the same in real market but when its comes to real money emotions take over strategies so one tends to start loosing money.
 
My 30 day winning streak ended today (in the real stock market), lost 11K today... but had I waited to square up in the last 3 minutes, I would have still made about 10k. Lessons learnt on a daily basis 🙁
 
xerxes said:
simulation prices are taken from live market afaik. its just that real money is not used. so strategy should work the same in real marketbut when its comes to real money emotions take over strategies so one tends to start loosing money.
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My point was that the service might be gaming the service to ensure that most of the 'gamers' win and not lose.
 
also get a better broker. 0.3% is ridiculous and don't ever go to any place where u pay brokerage in advance . its a losing proposition. u r depleting your account even before u begin !
What brokerage do you pay? With which firm?
 

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