What are the cues that short term traders should track after initiating the trade? Is there something specific that investors should be tracking?

As a prudent trader and investor, it is not just enough to create a fresh position. It is a lot more important to monitor your positions. Your trading account typically provides you with an in-built portfolio tracker that can help you through this process and you can also set triggers. So what exactly do you monitor?

Monitoring from a Short Term Traders perspective:

· Has the stop loss been hit and should I trigger the stop loss

· Although the profit target is yet to be reached, can I book partial profits?

· Having achieved profit targets, should I exit or hold on with rolling stop loss?

· Is the market too volatile for overnight risk?

· Is it better to close out trading positions ahead of the credit policy / budget etc?

· What is the worst case loss that can happen if the Nifty falls by 5%?

· Do I have sufficient capital and capacity to take that kind of a loss?

Monitoring from a Long-Term Investor’s perspective:

· Am I overexposed to a particular sector?

· Am I overexposed to a particular business group?

· How are interest-rates likely to move and how will it impact my holdings?

· Is my portfolio too much tilted towards cyclicals?

· Should I exit, hold on or average my loss making positions?

· Should I keep liquidity available to capitalize on IPO opportunities?

Monitoring your positions is extremely critical irrespective of whether you are a short term trader or whether you are long term investor. You need to be fleet-footed to latch on to opportunities and also quick to think with your feet when things are not working in your favour.