Positional Trading - A Short FAQ

Positional trading means making a call ( buy or sale ) and staying with that call for several weeks and may be a few months.

Two things are clear from the above definition.

1. Position trading opportunities will come less frequently than day trading ( obviously!) and also less than swing trading ( usually positions held for a few days )

2. The stop loss will be far from the price where the position is taken. Why? Because, you want to hold the position for a longer time frame and hence a tighter stop loss may close the position prematurely.

What is the advantage of position trading? Less stress (probably) but more importantly intra day or intra week volatility impact is less.

What is the disadvantage? Less trading opportunity. Last time a positional trading opportunity came by in Nifty, it was in the week of March 23/ March 30. ( Hint: check your weekly nift\y chart.

I believe another Nifty positional opportunity is around the corner. More on that in the next post.