4 Successful Trading Rules
Trading stocks, forex, gold, or anything is never easy. Nor will it ever be easy. Trading carelessly will only lead to losses, and finally losing all your money. There are rules that need to be adhered to trade successfully and generate profit. Here are 4 rules that every trader needs to follow.
1. Cut Losses Fast
Losses can never be completely avoided. No mater how skillful you are, one day you will definitely suffer losses. When suffering losses, the best strategy is to cut losses as soon as possible. If you don't want to cut small loss, in the end it will turn into mother of losses.
2. Ride winners as long as you can
When found a trading position that gives profit, trader should ride the position as long as possible. The result is maximum profit. What usually happens is the opposite. Traders keep a losing position, even average the losers. Finally you get huge losses and blow up your trading account.
3. Keep trading size small
During trading, a trader must keep the risk as small as possible. The trick is too keep trading size small. Using small amount of money to trade means the risk will also controllable. Another advantage is you don't get to emotional while trading. Using too much money will add pressure to your psychology.
4. Follow the rules without questions
Finally, we must follow the pre-defined trading rules without questions. Discipline. Whether it's opening a position, closing a position, money or risik management, all trading rules must be followed without any hesitation.
These four rules of successful trading are taken from quotes by Ed Seykota, one of the world's legendary traders
Hopefully this article useful and make you a more successful trader