ETMarkets Trade Talk: This 3rd generation Marwadi trader tells how to cope with market loss

NEW DELHI: Making money in the stock market is no easy feat, but Jyoti Budhia, a third-generation Marwadi trader, claims she didn’t face much difficulty in mastering this skill. She credits the support from experienced brokers – her parents and grandparents – for her success. Budhia reveals that despite facing tough times, she only grew stronger.

Budhia, who is the Director of BK Training, officially began her stock market journey when she turned 18. She shares that until then, she was only allowed to visit the Bombay Stock Exchange Ring (outcry system or pit) on Diwali day, as family members of brokers were only permitted during Mahurat sauda (trading) on that day. From the moment she stepped into the stock market, she never looked back.

She claims that the best time in her journey was during the “ring time,” as it taught her valuable lessons about life, attitude after earnings, discipline, and understanding market sentiments.

However, the stock market journey is not a one-way street. Budhia confesses that her first loss left her feeling depressed and in tears. But giving up was not an option for her, and she instead learned a few rules to help her cope with such losses.

In an interview with, Budhia candidly shares her experience of defying societal pressure and making it to Dalal Street, her rulebook for trading, how she manages trading losses, and advice for the next generation of traders.

Budhia broke a common bias in society, and despite facing taunts from the Marwadi community, she had the unwavering support of her family. As a third-generation trader, her family provided her with the necessary backing.

She recounts her journey, explaining that from a young age, she was involved in back office work related to share transfer and bill preparation. When she turned 18, she eagerly started accompanying her father to the Bombay Stock Exchange Ring. Budhia emphasizes that she faced tough times, but they only made her stronger. With the guidance of experienced brokers, her parents, and grandparents, she didn’t encounter much difficulty in her trading journey. Every loss and profit became a learning experience for her, which she now incorporates into her life.

Budhia’s success in the stock market has made her an inspiration to many women traders and investors. She recalls interacting with clients and students who have high expectations of learning trading quickly and replacing their jobs with more profitable earnings. However, Budhia believes that knowledge and practice are key to success, and overnight success is not possible. She has encountered individuals who compare and argue with different trainers, expecting one trading style to be universally effective, which she deems challenging.

Overall, Budhia’s inspiring story showcases her determination to excel in the stock market, her ability to overcome societal barriers, and the importance of continuous learning and practice in the trading world.

When did you embark on your stock market journey?

I have been immersed in the stock market culture since I was born. I inherited knowledge from two previous generations, and initially, it was more of an exciting experience than a career choice. Eventually, this excitement transformed into a career. The most memorable time for me was during the Ring era, where I gained valuable insights into life, attitudes after earning, discipline, and understanding the sentiments of people and the market, all thanks to influential brokers.

When you experienced your first drawdown, did you consider rethinking your decision? What did you learn from it?

When I faced my first drawdown, it was a depressing and tearful experience. However, reconsidering my decision was not an option due to the support and mentorship I received from experienced individuals who made me resilient. I learned the following lessons:

1) Do not focus on recovering the losses, but rather focus on earning again through knowledge and discipline, so that the losses become insignificant.
2) Learn technical analysis as it enhances learning speed.
3) Always set stop-losses to minimize losses, as failing to do so can bring your trading journey to a halt.
4) Take breaks from the market when experiencing significant profits or losses. Excessive exposure to trading is not beneficial.

What strategies do you employ when selecting stocks?

When it comes to stock selection, I utilize important candlestick patterns at support and resistance levels (identified through lines, chart patterns, and moving averages). Additionally, I rely on the Relative Strength Index (RSI), which is my preferred oscillator for stock investments or trading. For long-term investments, I employ technical analysis to identify multibagger stocks and adopt a systematic investment plan (SIP) using a portion of the profits earned each month. I also analyze futures and options data, option chains, and volatility for trading derivatives. In futures trading, I hedge my positions, and I tend to be more inclined towards being a buyer of options. I also prefer trading spreads.

What has been your experience interacting with younger traders? Are there any significant differences you notice in “Robinhood Traders”?
Interacting with younger traders reminds me of the beginning of my own career. They embody the same enthusiasm, aggressiveness, and constant search for the holy grail, often attempting to create “jackpot trades.” Nowadays, these young traders are utilizing algorithmic trading platforms for the same purpose. The attraction of free brokerage exists, but it often comes at the cost of compromised brokerage services.

Do you follow a rulebook when it comes to trading?

My rulebook for trading is simple and includes the following guidelines:

1) Determine the stop-loss before entering a trade.
2) Ensure the risk-reward ratio is favorable.
3) Keep losses small enough to avoid significant impact on finances.
4) Establish emergency exit points.
5) Avoid averaging down or attempting to repair losing trades. Cut losses and exit.
6) Do not chase after missed opportunities. There will always be new opportunities.
7) Love money, not specific stocks.
8) Keep trading simple and avoid unnecessary complexities.
9) Trade based on thorough study and continuously monitor to understand if the study is effective or failing.
10) Analyze trades each month to learn from mistakes and improve.

What advice do you have for new investors on navigating from a loss-making position?

1) Maintain stability, calmness, and a composed mindset while trading.
2) Dedicate at least 15 minutes every day to meditation.
3) Set stop-loss limits based on the amount you are comfortable losing.
4) Avoid getting swept up in the herd mentality. Make independent decisions based on your own research and analysis.
5) Focus on what you have studied and avoid getting distracted by speculative information.
6) Remember that both losses and profits are part of the business. Do not overly react to either of them.
7) Always respect the market as the ultimate authority and follow its directions. The market is always right.
8) Building wealth takes time, just like Rome was not built in a day. On the other hand, wealth can be destroyed within minutes or seconds.
9) The market has been around for generations and will continue to exist. Every day presents new opportunities.
10) For those considering quitting their jobs to enter the stock market, it is crucial to remember that a job provides financial security on the 1st of every month. Do not make hasty decisions to quit your job until you have consistently earned at least three times more than your job for a minimum of 12 months. It’s important to ensure your family does not face any hardships due to impulsive actions driven by excitement.