Saturday, March 19, 2016

Target Achieved in SBI - Time to Assess Profit

Remember I told you last Tuesday to buy SBI Mar Futures at 184/185 in this post. In this post I had mentioned that SBI was the right candidate for swing trading.. I had given the target as 190.

Yesterday, I had revised the target to 189.5. Check it here. Frankly speaking I had revised the target down because in yesterday's trade SBI reached a high of 189.7 and then dropped like a ton of bricks to day low of 184.5, which was a bit unnerving. I did not want a repeat of what happened yesterday and hence gave a conservative revised target.

Now lets analyze as to what happened to SBI in today's trade. SBI Mar Futures opened at 186.5, made a day low of 185.7 and then went on to make day high of 191.4, finally closing at 190.8. If you had closed your position at 189.5 as recommended yesterday, you still would have made a good profit in three days.

Profit Calculation

Bought at 184.5 , Sold at 189.5
Lot size : 2000 shares
Profit =  (189.5 - 184.5 = 5) X 2000 = Rs 10000/-

This profit has been achieved in three trading sessions with capital investment of Rs 80000/-. Hence Return on Investment (ROI) is 12.5% in 3 days. This the power of swing trading.

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