StockFetcher Forums · General Discussion · Are you trading assumptions or statistics?<< >>Post Follow-up
749 posts
msg #90117
Ignore miketranz
3/22/2010 5:16:02 PM

The way to make money in the market is to trade stocks that show consistent patterns,based on statistical probabilities,in your favor.Most of the money lost in the market is from pure speculation.1)Trading stocks that have no proven statistical advantage.2)Trading without a plan.3)Assuming market direction.4)Trading emotions based on fear and greed.5)Front running a position without trade trigger confirmation.6)Holding on to losing trades below you entry.7)Failure to take profits at the right time.Casinos make their money not on assumptions,but on known statistical odds,in their favor,all day long.Gamblers assumptions are what casinos profits are built on.Trade with the casino mentality in mind next time you enter a position.It will position you with the odds in your favor.......

4,599 posts
msg #90119
Ignore Kevin_in_GA
3/22/2010 6:09:55 PM

I'm guilty of TOO many of these, but my biggest challenge is cutting off a bad trade. I can't seem to let these go, always thinking that it will turn around and give me back some of my lost money. It never really does (truth be told, a few of them have, but not enough to make up for the ones that don't).

7,051 posts
msg #90121
Ignore karennma
3/22/2010 6:38:10 PM

The best way to break yourself of "holding on" to bad trades, is to put in a sell stop IMMEDIATELY after you get filled.
No more "mental stops"!!!
It's easier to move on to something else when you've automatically been stopped out of a bad trade and your cash is available.

76 posts
msg #90123
Ignore Venice
3/22/2010 7:02:37 PM

For me, I am willing to take up to a 4% loss on any trade I make. As long as the stock isn't completely crashing, I base it off the days close. If the close is more than 4% of my original purhase price, it is going to be sold before 10 the next morning. I try and cut down the loss if I get lucky enough with a morning rally. If it opens down and all indicators look like crap she will be gone immediately. Although my losses are soometimes more than 4%, their are others where its less. My average maximim loss is 4% though. Seems to be working out hus far. I am a swing trader as well so I shoot for 2-10% profit areas, and attempt to have more wins than losses.

749 posts
msg #90142
Ignore miketranz
3/22/2010 11:52:05 PM

Nobody likes to take a loss,but unfortunately it's part of the game.On any given day in the market,no one knows whats going to happen.Even with a good system,you're at 50/50 odds either way.You just have to learn to deal with the downside of the equation.There's numerous ways to lose money in the market,but more times than not,it all comes down to emotions.I don't mind losing money for the right reasons,like when I follow my plan and get stopped out.It's when I don't follow my plan,and I'm still in a position for the wrong reasons,that's where trouble begins.When you enter a trade,there's only two numbers you have to worry about.Your entry and your exit.If the stock trades below your entry for whatever reason,the only number you have to worry about is your exit.More times than not,you're stuck in a losing position.Small losses become large losses.Now you're in a stock for the wrong reasons and then emotions kick.This is where traders lose big money.Most of the books on trading recommend a stop loss at 5-10%.In my opinion,it's better than losing 25-50%,but in reality it's a fast road to the poor house.To lose that kind of percentage,do you know how far away from your entry you would have to be? Do you know what direction the stocks heading? Believe me,it's not in the one intended.If I lose more than a 1/2% on any trade,I'm gone.Keep your losses to a minimum,stay in a trade for the right reasons.When those reasons cease to exist,exit the trade,that way you'll live to trade another day.....

StockFetcher Forums · General Discussion · Are you trading assumptions or statistics?<< >>Post Follow-up

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