- When in doubt, stay out
- Never trade or invest based on hope
- Act on your own judgement or else absolutely and entirely on the judgement of another
- Buy low (into weakness), sell high (into strength)
- Don't overtrade
- After a successful and profitable campaign, take a trading vacation
- Take a periodic mental inventory to see how you are doing
- Constantly analyse your mistakes
- Don't jump the gun
- Don't try to call every market turn
- Never enter into a position without first establishing a risk reward
- Cut losses, let profits run
- Place Numerous small bets on low-risk ideas
- Look down, not up
- Never trade or invest more than you can reasonably afford to lose
- Don't fight the trend
- Whenever Possible, trade liquid markets
- Never meet a margin call.
- If you are going to place a stop, put it at a logical, not convenient, place
The Ten Tips
- Don’t trade at the edge of the pendulum.
- Pring’s Law states that other things being equal, trading success is inversely related to emotional stimulation.
- Only trade with a balanced mindset.
- Patience and discipline ?required ingredients for successful trading.
- Only trade when you feel good and there is an obvious opportunity; never purely because you want to.
- If you get in for a reason get out when it’s no longer valid.
- Do not penny pinch.
- Trade smaller positions when things go wrong.
- Not sure? Don’t trade.
- Take time to learn.
Making a Plan and Sticking to It
o Setting up your personal investment objectives
- Investor
- Trader
o Adopting an investment or trading philosophy
o Establishing a plan to maximise objectivity and minimise emotion
1. Self-analysis
2. Mental rehearsal
3. Developing a low-risk idea
4. Stalking
5. Action
6. Monitoring
7. Getting out
o Establishing a review process
No comments:
Post a Comment