Dear All,
Starting a thread for Rules of Successful trading which will come in 4 Parts( Learning from the "Truth of the Stock Tape".
1. Capital Required
• Do not try to get rich in a few months or a year.
• Do not expect the impossible in speculative markets.
• Many people are satisfied with 4 per cent in a savings bank, but when they come to Stock market. They expect the capital to double in 2 to 3 weeks
2. Limit your risk
• Protect every trade with a stop loss order, do not start trading, for you will fail.
• There is nothing better than getting out quickly when you are wrong.
• Do not trail back the Stop loss order when see the price is getting close to SL.
• If your stop is not reached and the market goes in your favor, you must then cancel your stop loss order when you close out your trade with a profit.
3. OVER TRADING -- THE GREATEST EVIL
• Make up your mind how much loss you can afford before you make a trade and not afterwards.
• Stick to small quantities. Be conservative. Do not over-trade, especially at the bottom or top of long moves.
• If you make one trade and it starts to go against you, you are wrong. Then why buy or sell more to average a loss?
Next Update - Tomorrow :)