Want to be a trader? Or, more importantly – a profitable trader?
Great. Here it is.
Follow these rules:
1. Don’t fight the trend.
Don’t bet against the market – it will crush you.
If a trade is going against you – you get out.3. Take small losses.
Do not be afraid to take a loss though. Just keep your losses small.4. Be diversified.
The only people trading in only one asset should be those that are hedging.
5. Do not listen to your gut.
Repeat after me. Emotional trading is bad. Your gut is not a trading system.
6. Hold on to winners.
Do not let go of winning trades too soon.
7. Let go of losers.
Let go of losing trades at your defined loss point.
8. Do not go in under-capitalized.
Know how much equity you need to trade in a specific market. Over-leveraging is to be avoided.
9. Understand expected value.
This is the key to a rational trading system. Make gains bigger than losses and keep an eye on your winning percentage.
Now go trade.