Forward & Reverse trading

Hello readers, 

You might be guessing there are loads of tips and tricks available for stock market trading then why another one...?
That is because here I am not copy-pasting anything from anywhere this is totally my experience of trading and tips which work out for me.


In trading there are 2 types of trading 
1) Forward trading
2) Reverse trading


You might have not heard about them but they exist not many people know about them. Most of the people do only forward trading. You have to use both the ways to maximize your profit. Here is the details about forward and reverse trading.


1) Forward Trading : This is the most commonly used method in trading ie, ex: you buy a share of  Rs-10 wait for it to go to Rs-20 then sell it, the brokerage company will keep some fee and rest of the amount is yours... This you already know.


2) Reverse Trading : This method is not commonly used or not explained to the customers.
In this method you sell the share first even if you dont have then purchase it when the price drops. This method might not be available with all brokers so confirm it from them.


Advantages : By using both Forward & reverse trading you need not fear if the market is going up or down in both ways you can profit. 
Ex: You buy a share at Rs-100 & waiting for it to reach Rs-150 but suddenly the market falls and your share price starts to decrease from Rs-100 to Rs-95 then to Rs-93 then you are under loss now so if you feel its still going to decrease then sell 2 shares (although you have bought only one) and wait for the price to still go down say it comes to Rs-80 then purchase 1 share. So now the math says :


Bought 1share @ 100
Sold    2 shares @ 93
----------------------------
Total is               -7 (calculating only one share)


Now one share is still less and you have to buy it right ?


So,


Sold share 1 @ 93
Bought      1 @ 80
----------------------
Total is         +13


Hence you are still under profit even if market falls :)
Either way you are going to make profit.


So think and trade.


Next tip will be on Do's & Dont's in Stock market.If you like this article then press this icon .