Here are ten reasons a stop loss is so important in trading: A stop loss defines your price risk by quantifying what price level you will exit a trade at. A stop loss helps define your trade size. By knowing what price you are going to exit a losing trade you can set your position […]
Why A Stop Loss Is Important In Trading Read More »
“Successful trading depends on the 3M`s – Mind, Method and Money. Beginners focus on analysis, but professionals operate in a three dimensional space. They are aware of trading psychology their own feelings and the mass psychology of the markets. Each trader needs to have a method for choosing specific stocks, options or futures as well
Money Management in Trading Read More »
In trading as in life there are both risks and rewards to consider before you start any journey. You have to ask yourself are the risks of loss worth the possibility of the gains from the rewards. In trading your risk is created on entry by a combination of your position sizing and stop loss if
The Risk vs Reward in Trading Read More »
On trade entry the risk/reward ratio measures a trades potential for loss versus the magnitude of possible profits. In backtesting the average of all the losses in a system compared to all the average gains gives you the system’s risk/reward ratio based on historical price action. Looking at your stop loss versus your profit target
What is a Risk Reward Ratio? Read More »
In trading defense is under rated and offense is over rated.Too many new traders want to make money so bad they don’t even consider the risk of loss when the market becomes very volatile and plunges. Here are ten ways to manage risk and limit your losses during market plunges. Your maximum position size on
10 Ways To Protect Yourself in Trading Read More »
This is a Guest Post by Niclas Hummel, creator of the Risk Simulator and a trader living in Bangkok. “Trading is managing risk and being a trader is being a risk manager.” This simple statement implies two realities: There is always risk The only thing you can do is manage it So what can you do to be a
10 Tips For Better Risk Management in Trading Read More »
This is a Guest Post by Niclas Hummel, creator of the Risk Simulator and a trader living in Bangkok. A Monte Carlo simulation projects your trading system’s equity curve into the future. You only have to know the average loss, average win and hit rate of your system. Because I could not find a good Monte
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This is a Guest Post by AK of Fallible. Bruve Kovner: How To Trade Stocks Like A Market Wizard Bruce Kovner retired in 2011 from Caxton Associates, the hedge fund he founded and ran for 28 years. Over that time the fund returned an average of 21 percent a year since its inception. In comparison,
A Market Wizard on Risk Managment Read More »
Raymond Dalio is an American billionaire investor, hedge fund manager, and philanthropist. Dalio is the founder of investment firm Bridgewater Associates, one of the world’s largest hedge funds. Bloomberg ranked him as the world’s 79th wealthiest person in January 2019. Here is a video posted by Investopedia on Youtube where Ray Dalio explains how to diversify assets and trading systems to maximize
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This is a Guest Post By Brian Hunt CEO of InvestorPlace. Of all the things that separate a great investor from the average losing investor, few can match the power of The 5 Magic Words A Great Investor Says Over and Over. A great investor says The 5 Magic Words – or something like them
5 Magic Words A Great Investor Says Over and Over Read More »