The trader that rejects risk management and thinks they do not need it discover sooner or later that they did. A trader can be successful for periods of time ignoring their risk exposure and their probabilities of the risk of eventual ruin. However they learn that they were just mortal and the trading gods will […]
10 Reasons Risk Management is Essential to Profitable Trading Read More »
If you are randomly trading based on a hunch, with no real underlying system, then your odds of success in the longterm are slim. The systematic trading of a winning methodology is what creates an edge in trading. Consistently trading a robust system or methodology enables you to trade in a way that wins in the
Answer These Questions Before You Trade Read More »
The question is: “Where will your account be with a string of 10 consecutive losses?” Some traders will be out of business, others will be down 10% from their equity peaks. The truly naive or arrogant trader will think that 10 straight losses will never happen to them. Even with very high winning percentage system
7 Steps for Surviving a Drawdown Read More »
If you are currently feeling down about any personal trading losses then this article may put these losses into perspective. These losses show how crucial it is to have a price level that will indicate that you were wrong and will need to stop out at. There is no reason to ever take a huge
12 Biggest Trading Losses Ever Read More »
“Where you want to be is always in control, never wishing, always trading, and always, first and foremost protecting your butt.” -Paul Tudor Jones This week was a lesson in how well traders managed risk, and how fast they could cut losses when they were wrong. If you made money this week, BRAVO! However, the
The 7 Psychological Mistakes That Blow-up Trading Accounts Read More »
Trading stress is primarily caused by two things: either not knowing what to do, or knowing what to do and not doing it. Many times, a new trader will discover that there is a big difference between reading about trading or simulated trading, and trading with real money on the line. Stress can knock
15 Ways to Manage Trader Stress Read More »
What trips up the vast majority of traders, so they never quite make the transition from new trader to good trader? Not being able to deal with the stress of trading. This is caused primarily from a lack of faith in themselves, and or their method. They lack the ability to pull the trigger
Successful Trading: How to Put it All Together Read More »
Paul Tudor Jones famous interview and documentary “The Trader” is a classic amongst market professionals. It is one of the few places you can see a true Market Wizard and young money manager become a billionaire. Here are the lessons I have gleaned from watching the master in action: It is possible to see that
Paul Tudor Jones’ 22 Trading Principles Read More »
If you are feeling down about your trading losses, then this article may put both of these losses into perspective. These losses show how crucial it is to have a price level that will indicate that you were wrong and will need to stop out at. There is no reason to ever take a huge
Twelve of The Biggest Trading Losses in History Read More »
The very first rule we live by is: Never risk more than 1% of total equity on any trade. -Larry Hite I try very hard not to risk more than 1% of my portfolio on a single trade. –Bruce Kovnar One of the most important lessons that a trader must follow to ensure his long term
Risk Management for the Trader in 1 Lesson Read More »
Recently I have been searching for and studying the option strategies of the wealthy and retired author and trader Nassim Nicholas Taleb. In my search I stumbled across this great article that shares some of Taleb’s basic methods for trading options which are shocking and also how the legendary trader Victor Niederhoffer ended up completely
Trading: Nassim Nicholas Taleb Vs. Victor Niederhoffer Read More »
A trader’s number one job is NOT: Stock Picking Chart Reading Trend Following Entries Exits Understanding the market environment Managing Emotions Managing Ego A Robust Method Or even Discipline A traders #1 job is to be a great risk manager. While all these have there place for every successful trader the #1 thing that will
A Traders #1 JOB is….. Read More »
Ever have that day when you were 100% sure about a trade. You just could not lose, the stock was a real buy, it had already fallen a great deal and it could not possibly fall any farther. So you waited and then plunged in, you couldn’t lose so why
Why Apple Bulls Got Hurt Read More »
“Plans are plans until they aren’t. Don’t confuse trading ideas with prophecy. You don’t know the future. Unless you cause it.” -Curtis Faith This morning I went in very biased about buying Apple long, my mind was clouded with the support level of the 50 week moving average holding up
How I was Wrong but Still Made Money Today Read More »
In trading, activity alone does not make money, the right activity at the right time is what makes money. Many times the right thing is to do nothing. Over trading is one thing that causes traders to lose money. You can not make money every day in every trade. Every
The 4 Things A Trader Has To Know Read More »
I love trading liquid weekly options, they are amazing tools if used correctly. Weekly options give a trader leverage, risk management, asymmetric trades, and the ability to make triple digit returns on capital at risk. I know of no other tools that have such upside and limited downside. And many of the weekly options like SPY, IWM, QQQ,
The Power of Trading Weekly Options Read More »
https://www.youtube.com/watch?v=Zg7RBwhgj6E On this scary holiday of ghouls and goblins, trick or treating, and haunted houses it made me think of what is really scary for traders to do. Emotions sometimes are sending traders messages, fear can mean that you have not done enough homework or that you are trading too big. Fear can be
The Top Ten Scariest Things A Trader Can Do….. Read More »
Trading is a process of learning and relearning key lessons in psychology, risk management, and using a proper method. Trading is like building a wall with the right bricks and when you leave a brick out, the whole wall eventually collapses. Or if you use the wrong quality of bricks even though the wall
Be A Better Trader: 8 Steps Read More »
1. Managing the risk of ruin. Do not risk so much on any one trade that 10 losing trades in a row will destroy your account. risking 1% to 2% of your trading capital per trade is a great baseline for eliminating the risk of ruin. 2. Only trade with
7 Things You Must Do to Win at Trading. Read More »
“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” -George Soros One element of trading that is over looked as traders chase hot stocks, trends, and chart patterns is the importance of taking
Trading:The Secret Sauce Read More »