Book review of: How to make money trading derivatives
A genuine effort to educate traders.
This book was first published 2005. It mainly deals with the subject of technical analysis and methods to make money in the derivative markets of India. The author believes that that technical analysis is a very vast field and there are various sets of beliefs when it comes to technical charts and indicators. He stresses that traders should use only a handful of tested techniques and strategies. He does well at keeping the book simple and is directed to trader with an elementary knowledge of the subject. He also discusses the Indian economy, capital markets and basic derivative instruments.
There is also a section devoted to different indicators like Moving averages, ADX, MACD, RSI, stochastics, Fibonacci retracements etc. and some basic cash/futures arbitrage which is pretty ancient. The chapters dedicated to the use of options can be an informative source for beginners, especially how he describes selling strategies to make consistent and less risky returns.
The later chapters are invaluable to people who want to learn about money management, the use of stop losses, different approaches, discipline and consistency. Ashwani Gujral very rightly stresses the importance of these qualities to succeed in the long run.
Those of you who are looking to enhance your knowledge on technical analysis and strategies should look elsewhere because this does not dig into those details. Overall a good book to get a perspective on the markets.