Money Management: Stop LossWhen setting up a trading system, it is necessary to define the entry and exit rules first. This can be as simple as a moving average crossover or as complicated as waiting for several indicators to be in a bullish or bearish mode before a signal can be generated. Some people prefer to buy only on an entry signal and sell on an exit signal, holding cash until the next morning comes along. Others prefer to be exposed to the markets at all times. To accomplish this, when the original long position is closed out, a short position is immediately initiated. |
 Read more (Members Only)...
|
|
Never Let A Profit Turn Into A LossThis is a simple enough rule that everybody applies without thinking about. When a floor trader first told me about it, I dismissed him as being overly cautious. I continued to make the mistakes of selling out my winners and keeping my losers. |
|
Read more (Members Only)...
|
|
When To SellInvestors spend most of their time deciding what stocks to buy. They spend little, if any, time thinking about when and under what circumstances their stock should be sold. This is a serious mistake. Equal time should be devoted to developing a realistic set of selling rules to capture the maximum profit. |
|
Read more (Members Only)...
|
|
Using A Stop That Makes SenseThe most important factor in determining the nature of your stop is to determine if it make sense given your objectives, the nature of the concept you are trading, and your temperament. You must use something that makes sense. Let's look at some of the other types of protective stops that you might use and examine the issues involved.
|
|
Read more (Members Only)...
|
|
|
You are at 
