Here was a peace of advise from one of my Trader Friend
In order to be a great trader you have to perform like a well oiled machine. There is no room for error. A momentary lapse of concentration or focus can spell disaster. Great traders DON”T MAKE MISTAKES. You will never see them…..
The recent events surrounding the fat finger trade by Emkay are a good example of this line of thought. Owing to a human error, a basket trade to sell Rs.17 lakh of Nifty was instead placed as an order to sell 17 lakh nifties (where one `nifty’ is a basket of 50 shares adding up to the present level of the Nifty index expressed in rupees). If Nifty is at 5000, then an order for “100 nifties” is an order for Rs.500,000.
Through this human error, a very large sell order appeared on the market.
- Try to close a position but accidentally DOUBLE it instead.
- Put a swing trade on and realize AFTER the close that earnings are coming soon. Like the next morning. Before the market opens.
- Buy the CALLS in a stock that is breaking out at what they think is a bargain price, only to find out later that they actually bought the PUTS.
- Constantly drive by their ex girlfriend’s house to see if she is dating that idiot biker guy with the tats who will never love her the way they would….
- Knock off early for the day to go rollerblading, sure that they put a hard stop in on their position before they left (but didn’t).
- Be so quick on the trigger that they get a trade down in SBI at the open before a 20 point run. Then realize that they actually bought SBI.
- Continuously hit the “submit” button on their trading platform when their order “hangs up” only to find out that they bought their position eight times.
- Listen to the whole “Best of WHAM” album online, unaware that Spotify is auto-posting that info to their Facebook timeline.
- Think they have a “one cancels other” limit and stop in place and take a long lunch after their position hits it’s profit target. Then come back later in the day only to learn that price reversed, hit their stop (making them net short), and then rallied.