The three basic levels you need to know before entering any trade !!

The word stop loss is an order to exit either a long or a short position once the price of the position crosses a particular predetermined price level. It is a tool which help investors to control their risk of loosing money more than their pocket allows. Mainly used in intraday trading. It can prevent small losses becoming the large ones. It can save you from unexpected news that come in the market because of which there is a sudden price action against your position. The stop loss facility is free of charge and no higher commission is charged. Traders can trade with the time freedom and freedom from monitoring the same stock again and again.

Most of the times investors have experienced it that if they do not placed the stop loss order and assumed that they will exit the stock manually once price reached their exit level, the have suffered more losses just because they could not exit on time due to higher volatility. Here the stop loss comes into picture. Though many investors think that a stop loss order is only associated with a long positions, bu tit can be used for a short position too. Moreover there are no rules set up for placing stop loss orders. Traders use very tight stop losses.

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Fundamentals April 30, 2013

Nik's Diary The Indian markets opened in the green following strong start to SGX Nifty and major Asian indices after better-than-expected reading on US housing sales and amid speculation that central banks will continue the stimulation measures. The US markets ended on a positive note on Monday with S&P 500 closing at a record high as traders reacted positively to the latest batch of economic news. The strength on Wall Street reflected a positive reaction to a report from the National Association of Realtors showing a bigger than expected rebound in pending home sales in the month of March. The pending home sales index rose by 1.5% in March 2013 after falling by 1% in February 2013. A separate report from the Commerce Department showed that personal spending climbed 0.2% in March 2013 following a 0.7% increase in February 2013. Meanwhile in India, renewed hopes of an interest rate cut at the RBI's monetary policy meet that is scheduled on May 3 helped stocks close high...

Fundamentals April 10, 2013

Nik's Diary The Indian markets opened in the green mirroring a positive opening in SGX Nifty, which is trading higher by 0.4%. Asian markets are trading mixed with the Hang Seng, Nikkei and Seoul Composite higher by 0.4% to 0.7%, while the Strait Times and Jakarta Composite are lower by 0.2% each. The US markets, after remaining directionless in early trade, rose higher during the course of the day, yesterday. The positive performance of the markets was partly due to tame inflation reported by China, which eased concerns that the People's Bank of China might tighten its monetary policy. US markets didn’t react much to the report released by commerce department which indicated that wholesale inventories unexpectedly dipped by 0.3% in February, although wholesale sales jumped 1.7%. The European markets ended Tuesday's trading session with mixed results after trading positively in the opening trade. Meanwhile, Indian markets posted losses for the fifth consecutive tradi...

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