Investing: I am focusing on preventing capital loss.
I started my equity journey last year, just before the market began to crash for each passing month. Since the market was at its peak for only 2-3 months when I systematically started putting my money, my overall account P&L is still in profit, though these gains, if compared to the average fixed deposit interest of 7% APR, the gains in my account seemed negative then.
Actually, performance of my holding is not good is due to my own investing logic of chasing a specific "industry" stock which is not performing good. I am holding a major chunk in my portfolio for this stock, averaged out at different intervals of the time but I am still at the loss for this holding even when market is started showing the upward trends.
Even with this holding loss, I still say I am at profit because I am able to execute "Buy low, Sell High" strategy multiple times and got the dividends for holding the stocks. So combining the profit/income of both the above method has overall preserved my capital.
This time, I have set a fixed amount of money that is 1 Lakh INR (or close to $1100 USD) for short trading gains. I am with this money is just trying to beat the bank APR of 7% and keep my capital liquid for me. With this strategy in mind, I am keeping eye on market ups and down and when I saw one of the good stock slipped down, I purchased $1100 worth of stocks for it. This trade was executed on the last week of the October. Today, I am able to sell back this stock and with all the brokerages and taxes paid, my calculation says that I am able to get 3.5% return on this trade in less than 20 days.
Now my next goal is to get another 3.5% return to be generated by this capital in next 2-3 months by aiming on low gains and specifically focusing on capital preservation. I am not sure if I consider it's my beginner's luck, but amount of time that I investing in tracking the price daily for few specific shares in which I am looking to trade make me believe that I am taking calculated risk.
So today, my capital returned with profit to me, my journey to find another winner to pick that even able to give me even 2% return (after deducting all expenses) in period of less than in a month starts.
Hope , I am to successfully execute this strategy, which I am defining as "small gains with liquidity" that at least beat inflation.
Just wondering, what is your trading/investing strategy. Is it fully long term or it do have short term goal. Do you have devised any successful strategy for yourself that is taught no where and work good for you?
I will like to know from your experiences and how effective it was and how much gains you were able to achieve from it.