Separating Fact from Fiction: Why Trading is Not Gambling

As someone who has been researching and actively involved in trading for some time, I’ve often encountered misconceptions about trading being akin to gambling. I wanted to clear up these myths and share my insights with you.

In my experience, trading, especially intraday trading, requires a deep understanding of market dynamics, calculated risk-taking, and a well-thought-out strategy. It’s a challenging yet rewarding field that demands a unique combination of skills, patience, and discipline.

Intraday trading, or day trading, involves buying and selling stocks within the same trading day. It’s a high-stakes game that requires a distinct set of qualities, including:

1. Patience
2. Discipline
3. Risk-taking ability
4. Calmness
5. Optimism
6. Self-control

Given the higher risk associated with trading, I strongly advise beginners to exercise caution and keep the following points in mind:

1. It’s not necessary to trade daily: If the market is down, it’s wise to keep yourself away from trading.
2. You don’t need to spend the whole day trading: Focus on specific time slots and strategies.
3. Select shares/stocks wisely: Study the market at night and select specific shares/stocks for the next day.
4. Analyze market trends: Study the graphs/waves of the last few days or months of the particular share.
5. Timing is everything: Entry and exit at proper times are crucial.
6. Avoid volatile market hours: Beginners should steer clear of trading between 9:15 am and 9:30/10 am, when the market is highly volatile.
7. Understand market patterns: The market tends to be stagnant or slightly lower between 11:30 am and 1:30 pm, while it becomes more volatile from 2 pm to 3:30 pm.
8. Don’t repeat trades: Once you’ve booked a profit against a particular stock, avoid buying the same stock on the same day.
9. Focus on a few stocks: There’s no need to trade multiple stocks on the same day.

By embracing these strategies and cultivating the necessary skills, you’ll be well on your way to becoming a successful trader. Remember, trading is not gambling; it’s a calculated game of risk and reward.

Key Takeaways:

• Trading requires knowledge, patience, and discipline.
• Intraday trading involves buying and selling stocks within the same trading day.
• Beginners should exercise caution and follow specific strategies to minimize risk.

As you embark on your trading journey, keep in mind that success is not solely defined by profits, but also by the lessons you learn, the strategies you develop, and the discipline you cultivate.

Mou Mukherjee, Trader ,Ex SSE at IBM India Pvt Ltd, Oracle Apps professional, Artist , Runner