Trader, Cricketer & You:: Part 2: Understand & Realign
Carrying it forward from where we left in the 1st part...
In case you haven't read the 1st part, you can read it here in the link below
https://in.tradingview.com/chart/NIFTY/Qr23JULx-Trader-Cricketer-You-Part-1/
A batsman’s (trader’s) approach to his batting (trading plan) depends on
Whether he is playing:
- Test match (Long term investment)
- One day International ( Medium term)
- T20 match ( Short term / Leverage trade)
- Or for that matter a Rain hit T20 match ( Intra day High leverage high risk trade)
While playing a test match a batsman’s
- Focus is on avoiding temptations
- Keeping patience & willingness to leave a lot of deliveries
- Looks to hit when the ball is in his area of strength
- May score at slow pace but focus is on scoring big over period of time as he is aware & relaxed that time is on his side
While playing a T20 game
- looking to score at high strike rate but overall runs per match still restricted due to limitations of just 20 overs per match
- willing to take very high risks sometimes almost every delivery
- risks losing his wicket often
In ODIs
- tries to have a balanced approach
- looks to build his base & take calculated risk
- Unlike T20 match, batsman knows he has more time & hence can focus on planning, preparing and attacking at the opportune moment & revising his plan if there are deviations (after reading & getting a feel of the pitch, fall of wickets, targeting supposedly weaker bowler or last 10 overs, etc)
So what’s the similarity from trader’s perspective
Let’s see
A Test match trader / investor should
- Avoid the temptation of trading every trade
- Keep patience & should be willing to leave a lot opportunities he is unsure of
- trade when the price & trade set up is in his comfort level where he understands the risk & knows reward potential is far higher than risk involved
- focus on sustainable trades & stay in the market for a longer time
A T20 trader
- intraday / short term / leverage trader
- looks for higher leverage trade for higher reward potential on relatively less capital
- but overall profits per trade gets limited as leverage trades have a daily / weekly / monthly cut-off time
- hence many a times a high leverage trader cannot take full advantage of the complete potential movement in the stock
- often he also risks his capital (Wicket) as even a slight movement in the opposite direction can lead to Capital erosion
Medium term trader
- Looks to capture a decent opportunity & is willing to give the trade set up the time it deserves
- Uses trailing Stop loss to adjust as per markets movements
- Leverages only when he understands risk :: reward ratio and considers it to be favorable
- Does not risk by over-leveraging
Some food for thought…
- Virat Kohli in 86 Test matches (145 inning) has scored 7240 runs; averaging 53.69 at a strike rate of 57.68; scoring 22 fifties, 27 hundreds & 7 double centuries hitting a boundary every 15 deliveries
- in 248 ODIs (239 innings), Virat has scored 11867 runs; averaging 59.34 at a strike rate of 93.25; scoring 58 fifties, 43 hundreds & no double century. He hits a boundary every 10 deliveries on an average
- in 177 IPL matches (169 innings), Virat has scored 5412 runs; averaging 37.85 at a strike rate of 131.61; scoring 36 fifties and 5 hundreds hitting a boundary every 6 deliveries on an average
Player is the same, ability is the same, capability is the same… but the above stats reveals that based on the format of the game player has to set different objectives, different targets & expectations and adjusts their style with different mindset, different mentality, & different strategies.
Remember it is not about which format is good or bad, it is more about adjusting & blending yourself to fit in different time horizons and having realistic expectations with understanding of risk involved
Understand and be clear with your objectives before you enter a trade.
...to be contd
In case you haven't read the 1st part, you can read it here in the link below
https://in.tradingview.com/chart/NIFTY/Qr23JULx-Trader-Cricketer-You-Part-1/
A batsman’s (trader’s) approach to his batting (trading plan) depends on
Whether he is playing:
- Test match (Long term investment)
- One day International ( Medium term)
- T20 match ( Short term / Leverage trade)
- Or for that matter a Rain hit T20 match ( Intra day High leverage high risk trade)
While playing a test match a batsman’s
- Focus is on avoiding temptations
- Keeping patience & willingness to leave a lot of deliveries
- Looks to hit when the ball is in his area of strength
- May score at slow pace but focus is on scoring big over period of time as he is aware & relaxed that time is on his side
While playing a T20 game
- looking to score at high strike rate but overall runs per match still restricted due to limitations of just 20 overs per match
- willing to take very high risks sometimes almost every delivery
- risks losing his wicket often
In ODIs
- tries to have a balanced approach
- looks to build his base & take calculated risk
- Unlike T20 match, batsman knows he has more time & hence can focus on planning, preparing and attacking at the opportune moment & revising his plan if there are deviations (after reading & getting a feel of the pitch, fall of wickets, targeting supposedly weaker bowler or last 10 overs, etc)
So what’s the similarity from trader’s perspective
Let’s see
A Test match trader / investor should
- Avoid the temptation of trading every trade
- Keep patience & should be willing to leave a lot opportunities he is unsure of
- trade when the price & trade set up is in his comfort level where he understands the risk & knows reward potential is far higher than risk involved
- focus on sustainable trades & stay in the market for a longer time
A T20 trader
- intraday / short term / leverage trader
- looks for higher leverage trade for higher reward potential on relatively less capital
- but overall profits per trade gets limited as leverage trades have a daily / weekly / monthly cut-off time
- hence many a times a high leverage trader cannot take full advantage of the complete potential movement in the stock
- often he also risks his capital (Wicket) as even a slight movement in the opposite direction can lead to Capital erosion
Medium term trader
- Looks to capture a decent opportunity & is willing to give the trade set up the time it deserves
- Uses trailing Stop loss to adjust as per markets movements
- Leverages only when he understands risk :: reward ratio and considers it to be favorable
- Does not risk by over-leveraging
Some food for thought…
- Virat Kohli in 86 Test matches (145 inning) has scored 7240 runs; averaging 53.69 at a strike rate of 57.68; scoring 22 fifties, 27 hundreds & 7 double centuries hitting a boundary every 15 deliveries
- in 248 ODIs (239 innings), Virat has scored 11867 runs; averaging 59.34 at a strike rate of 93.25; scoring 58 fifties, 43 hundreds & no double century. He hits a boundary every 10 deliveries on an average
- in 177 IPL matches (169 innings), Virat has scored 5412 runs; averaging 37.85 at a strike rate of 131.61; scoring 36 fifties and 5 hundreds hitting a boundary every 6 deliveries on an average
Player is the same, ability is the same, capability is the same… but the above stats reveals that based on the format of the game player has to set different objectives, different targets & expectations and adjusts their style with different mindset, different mentality, & different strategies.
Remember it is not about which format is good or bad, it is more about adjusting & blending yourself to fit in different time horizons and having realistic expectations with understanding of risk involved
Understand and be clear with your objectives before you enter a trade.
...to be contd
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