'm a new trader and I would want to understand how I can optimize my profit and decrease my loos, can some one please tell me the way to go about this? Thank you very much.
'm a new trader and I would want to understand how I can optimize my profit and decrease my loos, can some one please tell me the way to go about this? Thank you very much.
Additionaly to exactly what david_akc said I find it generally a good idea to construct positions as time passes and lock my prospective winners in by moving my stop loss in the winning zone (or using an automatic trailing stop). Enter the trade with a sensible volume, ones you are at the winning zone buy some more, wait a bit, move your stop loss and so on ...
If the trade goes wrong early in the trade your losses are low as your quantity was low and over time you end up with a bigger position but without exposing you to a increased risk of loosing money.
A good method I discovered for optimizing profits is by having a trailing stop loss once it has reached my goal profit.
By way of example when I reached my goal profit but believed that it could potentially grow higher, and I could make more of a profit, I'll place a trailing stop loss at that point, so in case it goes up I make money, and if it drops, the cease closes out it automatically.
Sell half your transaction as it's as much in pip profit as it will be a loss once it hits your SL, then participate profits if your trade keeps moving.
http://www.investopedia.com/terms/r/riskrewardratio.aspOriginally Posted by ;
Concentrate on learning how and why price goes, and you'll make money.
Focus on how best to make money, and you'll go nowhere.
Try to be profitable before you think about max profit.There is slight difference.Originally Posted by ;
Before you conduct learn to walk without tripping on each step.
In short like Hanover said focus on the why's. New traders think about profits experienced pro traders always think about Risk first.Control risk you have an advantage and without advantage don't even think about profits.
This is exactly what we all do and as for maximizing profits and minimizing loss, check out for patterns, pay attention to PA, . .what Hanover said is spot on.Originally Posted by ;
My best advice would probably be to just trade setups which you have absolute conviction with - i.e. setups you're nearly sure are likely to go in the direction you intend it to.
How can you estimate this? Confluence. The more confluence you've got on a setup, the more assured you're. If you're wondering if a specific setup ought to be entered, chances are that it isn't great and you should not enter it.
Great point! One addition, though. Once you've learned just how and why the price goes, get in the practice of increasing your position once the price starts moving in the direction of your initial trade. You can try cost-averaging on your way down, but you're likely to wind up in the gutter emotionally and financially. Habits are really important in trading so that you have to make certain not to get a lot of bad habits even though you're learning. The practical side of the information is that you will need to take fewer trades then you'd enjoy and keep a journal for every transaction you took.Originally Posted by ;