To counter finfluencers' narrative of trading success leading to enormous wealth, Zerodha-backed Sensibull has launched a series that discusses trading failures.
This is the second time Sensibull is taking a shot at finfluencers. The first was launching the VerifiedbySensibull feature, which allowed people to share their verified trading P&L statement, which went a long way in countering the doctored P&L statements that were being used to sell courses and illegal money management services.
Also read: MTM verification| To fake screenshots, small investors are most vulnerable: Sensibull's Abid Hassan
In the YouTube series titled, One Trading Mistake, traders will be invited to share their failures and their learnings from that and the first episode saw Sensibull's founder Abid Hassan sharing his big loss in a trade he did on SBI in 2017.
The idea seems to be to foster more realistic expectations from trading, in place of the dream of easy money. "We think, in trading, it is more important to learn from mistakes of people who are just like us, rather than try to be a star," Hassan said in an interaction with Moneycontrol.
He said that any regular trader, who isn't selling courses or giving investing tips on social media, is welcome to send in their interest to be interviewed for the series.
The big mistake
In the first episode, Hassan talks about how his short call on SBI went badly because of various reasons, including not having proper risk-management processes in place.
He had shorted SBI through futures and was making "decent profits" as the stock kept falling. Then the former finance minister Arun Jaitley shared in a press conference that there will be an announcement made in the evening, which would be supportive of the bank.
The stock started climbing along with the other PSU bank stocks, but Hassan held on to his future short position overnight, thinking that the stocks had factored in the positives and that it won't rally much more than it already had.
After market hours, Jaitley announced a recapitalisation of PSU banks and the bank's global depository receipt (GDR) rose 3 to 4 percent. The next morning, the stock opened gap-up in an upper circuit and continued to trade in the upper circuit. Holding on to that trade in the belief that the event (of an announcement of recapitalisation of the bank) would not play out too badly, ended up costing Hassan a loss that ran into a few lakhs or the cost of a small hatchback.
His learnings: never gamble on events, hedge your positions, you can never know where the market is heading, never get emotionally attached to a trade and never trade with money that you cannot afford to lose.
Also read: Nine out of 10 equity F&O traders lose money, 84% of them are men, 75% under 40: SEBI study
On sizing your positions right, he said, "If you are finding it difficult to cope with overnight events, then your size is too big."
The market regulator had commented on the massive influx of traders in the market - 500 percent rise over FY19-FY22 - in a January 2023 report. In a caution to these new traders, the report added that nine out of 10 traders in equity F&O segment incurred losses in FY22.
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