Last updated: June 7, 2026
Important — Read Before You Trade
Trading in the Indian stock market (NSE, BSE, MCX) involves substantial risk of loss and is not suitable for every investor. You should carefully consider whether trading is appropriate for you in light of your financial situation, experience, and risk tolerance.
1. Risk of Capital Loss
You can lose all or more than your invested capital, especially in leveraged products like Futures & Options (F&O), intraday trading, or Margin Trading Facility (MTF). Indian regulators (SEBI, NSE, BSE) require traders to understand this before participating.
2. Market Volatility
Indian indices (Nifty 50, Sensex, Bank Nifty) can move sharply due to global events, RBI policy, corporate news, election cycles, FII/DII activity, and macroeconomic data releases. Past returns do not predict future performance.
3. Indicator-Based Trading Risks
The Trend Traders Tool generates technical signals based on price patterns. No indicator is 100% accurate. False signals, whipsaws, and gap moves can result in losses. Always combine our signals with your own analysis, position sizing, and risk management.
4. Leverage Risk
F&O, MTF, and intraday positions amplify both gains AND losses. A small adverse move can wipe out your capital. SEBI mandates margin requirements; never trade without understanding them fully.
5. Liquidity Risk
Small-cap, mid-cap, illiquid stocks, and certain F&O contracts may be hard to exit at fair prices, especially during market stress.
6. Regulatory & Tax Risk
SEBI, NSE, BSE, RBI, and the Income Tax Department may change rules (e.g., margin requirements, lot sizes, STT, capital gains tax) with little notice. Such changes can impact your strategy and returns.
7. Technology Risk
Internet outages, broker downtime, exchange halts, or third-party platform (TradingView) issues can prevent you from executing trades on time. Finovatives is not liable for losses caused by such events.
8. Psychological Risk
Trading triggers strong emotions — fear of loss, greed during winning streaks, overconfidence. Many traders lose money due to emotional decisions, not strategy flaws.
9. No Guaranteed Returns
Finovatives makes no representations or warranties about future profits. Anyone promising guaranteed returns in the stock market is misleading you — this is a SEBI red flag.
10. Your Responsibility
You are solely responsible for your trading decisions, profits, and losses. Use only money you can afford to lose. Never trade with borrowed funds or money required for essential expenses.
Risk Mitigation Best Practices
- Use strict stop-losses on every trade
- Risk no more than 1-2% of capital per trade
- Diversify across sectors and asset classes
- Avoid over-leveraging — keep F&O exposure low
- Continue learning — trading is a long-term skill
Acknowledgement
By using finovatives.com and the Trend Traders Tool, you acknowledge that you have read, understood, and accepted these risks.