Hello everyone, the issue that we will discuss today is extremely important for all traders, no matter what level of excellence you have in trading right now or how advanced you are, we all have losses and anything that can help us minimize losses Is extremely valuable. It does not matter if you start or take many time, you will have lost and maybe we can talk about how to minimize them.
Is that most people start this in the wrong direction because what they do is try to find profits, make better profits, become better winners and a better money hunter, someone better at selecting stocks; This is the wrong way, how to progress, is not to make more money if you do not control the loss, because think of this, the profits do not need your help.
There is nothing you can do to help win a trading, if you can become a very skilled at finding opportunities, that is a very important Fortress, but other than that, after you identify the opportunity and enter into it More efficient way, what is your work besides praying? None, nothing, you do nothing but get nervous. Your most important job is lost, that's when the trader comes into action.
If you buy in 20 and the stock reaches 24, you did nothing, if you buy in 20 and the
Action drops to 15, but you closed in 19, limiting your loss to $ 1 instead of $ 5,
Then you did your job, you took on the bigger responsibility that
Has a trader. People go to seminars, read books, enter chats, receive
Advice, all with the intention of having greater profits, this is a mistake, the
Profits are not the problem, profits are the sun, the sun shines for the whole
World, you can be a serial killer and you get the same amount of sun as
Mother Teresa, the sun is universal, everyone takes part in the profits,
Is the nature of trading, because you have 50-50% chance that the
Market go up or down, then, Winning does not always require
Experience, to gain in a very high level of consistency if you have it, even without
No experience can have a good share of the profits, because
Every selection you make has 50-50% chance to go or not in your favor.
Due to the simple mathematics of the Market, you can have gains with zero of
experience. This is one of the main problems of people, because
They confuse the simple mathematics of the Market, with their experience, their ability;
Just sit and wait for the market to bring the other side of the
equation.
Let's say you continue to have earnings without experience, here is the
Problem: novices tend to want to take over the profit and having
Obtained that 50% begin to think, oh my God what if my profit
Disappears, what if it goes in the other direction? Should I leave now, O God
Was $ 80, now $ 70, now $ 65, now $ 50, is more than anything an agony in
A territory of profit. There is a lot of uncertainty, fear and
Courage is what makes your profit turn into red, in Lost. Now
Let's look at what happens in the negative territory, hope takes hold of you, what
Opposite of what you should think, you should think that you can lose very
Little and that if your game does not move in the direction you planned you have to
Cut it; On the contrary the novices increase their feeling of hope,
They start thinking, give it time, it's not ready yet. It is in the territory of
Losses, where you need to breathe deeply and relax and get out of the way,
Let the stock do its work, you just take it off, let the winners
Take your share. You must be a master at cutting your little performance in one
Window of very short time, zero hope. If you want to be a teacher you must
Practice being on the side of losses. Then I will give you 5 very things
Simple for them to work, if you achieve these 5 things, they will be the best
Things you can achieve in your entire life as a trader.
Define that they are lost: they have no idea how many traders come to me and
When I ask them exactly what a loss is, most of the
Novices do not know, can not define it, the first thing to do is
To define it, what they finally respond to after pressing them is
When I buy a stock at $ 20 and it falls below $ 20, no! .... you're a
Idiot ?, you're telling me that if you bought $ 20, $ 19.99 is a Lost?
No, understand this, you must define for the Market that is a Lost,
The market does not have to define it for you, that is your responsibility and what
A Lost is for you, it may not be for another. You must fix your loss
Maximum Daily. My traders are responsible for taking your Maximum Loss
Daily and divide it among its operations. So if $ 300 is your loss
Maximum per day, then how much will you use in your operation? Are you going to use
total? Are you going to give yourself one chance in the day? If this operation does not
Works and you lose your $ 300 in a single game, you think that's
intelligent? Should not you give yourself more opportunities? My advice is that
Take your maximum loss in one day and divide it into 2 or 3, 2 if you are liberal, 3
More strict, I prefer something in the middle 2.5. Then Lost are not 10
Cents, there is a neutral zone. You know how many beginners take 1 cent
As lost Many, and there begin to get nervous,
Experiencing hope, they are interpreting a neutral zone
Like a Lost. You have to define that it is a Lost and know in what
Point you reach it. The Market has no rules, it is your responsibility to bring
Order to the market. You present the rules to the Market: I am buying
Here and if I lose $ 150 you're fired. You impose the law on the Market, the
Order comes from the trader, the rules come from the trader, the market is a group
Of chaotic things and create order must come from you. There are the newbies who
They look for order, something that does not exist, you must create it, you must raise
The game, the parameters and then the Market plays by your rules. There
You stop being a rookie. You give the Market your definition of Lost, you
You define that your Loss is your Maximum Daily Loss divided by 2 or 3. If
Do you trade without this, how can you be consistent? Do not
You start to worry until you see that you are losing, which for
Definition you said that was your Lost, give this time for a dance,
Allows the game to occur, define your Lost in dollars and do not take off
Of this, do your word. Under no circumstances on this planet, under
God's rules, never let an operation violate what you have defined
As Lost. Practice keeping your word, it is your Strength, if you can not
Keep your promises, who do you think will do it? Promise me: I never go
To lose more than this, as soon as my law is maintained, there will be
Lost, practice and observe, if it falls below your Loss, sell, Close.
This is your job, if they do this consistently for a month, they will come back
With gifts for me.Never lose more than a bar, the bar that put you in the game, almost
70% of people violate this rule. If the market opens with a large candle and
Then disappears, why are you still there? Your reason is no longer, never
Lose more than your reason to enter, you can not drop your value by
Under that candle. Do not lose more of your reason, your reason is gone, now
You are in the land of Hope, you do not want to live there. The bar is what
Represents my input signal, reviews poor performance, and shortens
operation. What if your proper stop goes beyond this candle? So
This operation is not for you. All the women outside are not for
You may be beautiful but they are not yours. The operation should fit into
Your parameters, you can go as high as you want, but never lower, do
Your work, define the rules, the sky is the limit, that is the attitude of a
Teacher, do not pray.
When you lose, you lose a bar, but if you win there are no limits, win 12,
60, 30 bars, whatever you want, if you do this for a week, you will return with
gifts. Put these two rules together and never again (my mother tells me never
Say no), I'm sorry mama, if you put these two things into practice, you'll never be
The same trader, you will improve impressively, because the problem is
Let the weed invade your trades, that damages your roses, you can not leave
Let the weeds take over your roses, the rest comes in addition.Stop thinking that small profits are extraordinary. One thing
That makes me want to slap a trader is to have a profit
little. When you make your profits, get out of the way, practice something, go to
Bathroom, walk around your street, do something to stop feeling that your
Profits will disappear. Define what it is to win, 5 cents, 10 cents
Is not profit, for me less than 30 cents is not profit, you are worth more
That 30 cents and this without considering the commissions, to win 8 cents not
Covers all these rates, does not cover your stupidity. If you want to see me angry and
To slap you, then keep doing this. Say: I will not consider this a
Gain unless it is a minimum of __________. Define that it is a
Profit, the space between what you define as your profit and your lost
It is your neutral zone, that is the zone of relax, here nothing happens, in this
Area you can not be nervous, in this area you do not do any work.Stop buying from very high MA20 or very low MA20.
The shares spend half the time above this line and half of the time
Time down this line. Now if we talk about periods, some will pass
Most of the time up the line and for others the
Most of the time under the line. Then AAPL today passed the biggest
Part of the first 30 minutes above the MA20 blue line. The actions
Move away or approach the MA20, what you should not think about is that when
Is far away is the moment of purchase, that is the point of sale. For
To make purchases when the stock is away from MA20 and you're going to minimize
Your losses, in the same way it works down.
The market expands and contracts, when it expands, it is not time to
Enter, wait for it to contract, this will dramatically improve your
Possibilities of being in the right direction and vice versa.
This works for any period of time in the same way when
You shorts, do not shop down, wait for it to contract. This is
Buy and sell at the right time, this leads to profit.Stop wanting to be a hero, stop to see that an action goes down and
Want to grab the bottom, please stop, stop throwing your money
family. In time you will lose everything, keep the game simple. If the action
Goes down and is below the MA20 and the MA200, never again
Think about buying. If you can do this you will eliminate giant disasters, not
I'm saying you're not going to have losses, these are part of the game, but
Disaster, not at all. You will play fair, you will win more and with
Higher frequency.
You must know that knowing something does not mean you can apply it, you have to
Make your knowledge yours, you have to take it from the intellect to the Heart and
That you do with experience, practicing.
Even if they do not implement these 5 tools, if they implement only
The 1 and 2, will do wonders.
