111
عضو نشط
- التسجيل
- 31 أغسطس 2001
- المشاركات
- 28
part1 /// 23 rules to follow
23 Rules To Follow For Your Survival
As A New Day & Stock Trader!
#1. Rule Number One Is "Follow The Rules"!
Most Rookies have the URGE to jump right in during the first few days and start trading using real money.
It looks easy.
We will guarantee if you DO NOT precisely follow the rules in this lesson you will not survive!
#2. First Determine How You Want To Trade!
You need to determine the most appropriate for your trading personality.
#3. Find ONE Trading Technique To Stick With & Become Very Good At It!
Many times a ROOKIE will jump around from one trading system to another (grass is always greener on the other side of the fence) only to discover the first trading system they chose was the best. Normally they are out of money by the time they determine this so follow this very important rule…
For example "Resistance (r/p), Support (s/p) and The Cup & Handle (c/h)" plays. 95% of our profits come from those plays!
#4. Paper Trade!
What is typically called "Paper Trading" is either writing down a stock you would consider trading with real money on a piece of paper determining the entry and exit price or better yet entering them into your broker execution simulator…
This exercise will acquaint you with your broker execution program as well as establish and become familiar with the type of stocks in the day and stock trading system you want to use…
A. Select the stock(s) and either write them down on paper or enter them into your broker execution simulator.
B. Make sure you enter the trade using "Stop Loss Orders" and any other type of trading procedures you normally would use as if you were using real money.
C. Multiply this trade by the number of shares of stock(s) you would normally buy.
D. Paper trade or use your broker execution simulator for about 2 to 3 weeks or until you are at least 75% proficient.
#5. Trading With Real Money!
What you will discover is actual Day Trading (with real money) is MUCH harder and DIFFERENT than Paper Trading with a simulator. Now you are dealing with your hard earned cash and you are emotionally involved.
Each time you press the button to buy or sell you have to strike a reasonable balance between FEAR and GREED.
A. Initially trade in quantities of not more than 100 shares and do not, for the first 20 executions, trade more than 20% of your capital until you hit a 75% proficiency rate, then keep moving your shares up 100 at a time until you then again obtain the same 75% proficiency rate.
This way you will build confidence. You will get a feel on how easy it is or is not to catch an order. Always remember the simulator will most always catch an order at your intended entry level. The REAL broker execution program does NOT!
True you may NOT make much money on your first 20 trades and, in fact, you may lose money after you pay the broker commissions but what you will learn with this very important lesson is…
"You Must Experience & Learn First Hand How Using Real Money With The Actual Broker Execution Program Works" with the LIMITED RISK of only 100 shares!
One wrong click of the MOUSE with 1,000 shares could cost you thousands of dollars - one wrong click of the mouse with 100 shares maybe only 100
#6. Always Use A "Limit Order"!
Never use a "Market Order" as Market Orders can catch a stock at the TOP of a move and cost you BIG TIME.
#7. Use "Stop Loss Orders"!
#8. Do Not Chase!
At the beginning you will miss a lot of GREAT PROFIT OPPORTUNITIES and become very frustrated seeing those stocks run for 1 to 10 points. DO NOT give up or deviate from this rule as eventually you will learn how to catch those fast moving stocks!
If you have determined your entry and initial execution price is $20 and you have missed that price using a "LIMIT ORDER" DO NOT FOLLOW A STOCK UP PAST YOUR INTENDED EXECUTION PRICE!!!
There are exceptions and as you learn how a stock moves and reacts to what is called a "Break Away" you may be able to add 1/8 to 1/4 to that entry point but at the beginning "You Must Stick To This Rule Of Not Chasing A Stock"!
IMPORTANT - If it's easy to catch a stock chances are it will FALL. The odds say, as a rookie, if your first few clicks of that mouse does catch a stock you probably have bought it at the TOP of a move and it will FALL. Be ready to take a small loss and move on.
#9. If You See RED - Do Not Trade!
RED indicates SHORTING opportunities and Rookies should NOT SHORT until they better understand this technique!
If any one of the following three Indicators are WEAK or DOWN (in the RED) do not trade... DOW Jones - NASDAQ - S&P 500 Futures - sit back, relax and LEARN!
#10. Do NOT Trade Against The TAPE!
In other words if the market or a stock is trending down DO NOT GO LONG on a stock. If the market or stock is trending Up DO NOT SHORT a stock. The odds are against you if you "Go Against The Tape"!
#11. Use Discretionary Capital Only!
Capital set aside for Housing, Food, & Day-To-Day necessities should NOT be considered for trading!
#12. Diversify!
This rule is more for those who choose to build and hold a stock portfolio over-night. No more than 20% of your funds into one stock!
The magic number for diversification is FIVE (5) and you will learn if you are a Day Trader and follow the RULES the number FIVE (5) will present itself on several occasions.
#13. Minimize Your Losses - Maximize Your Gains!
Of all the rules you will learn in this lesson this one should be at the TOP of the list!
Most Rookie Day Traders end their new career EARLY because GREED influences their decision making process!
When Day Trading we suggest you minimize your losses and maximize your gains by NOT allowing a stock to lose more that 1/8 or 1/4 once you have purchased it and it decides to correct and go the opposite direction.
Just because we give you a suggested "Stop Loss" on certain stocks does NOT mean you have to wait for these Stop Loss Orders to kick in to exit. As a ROOKIE you MUST minimize your LOSSES by keeping them to 1/8 to 1/4 on each trade or you will be out of business in a short period of time.
Here's an example....
· Using the denominator of FIVE (5)...
· 4 losses at .25 with 100 shares = 1.00 point or $100…
· 1 winner at 2 with 100 shares = 2 points or $200…
Over-all you would have more losses than gains but you will be $100 ahead…
We have determined if you follow the rule of losing no more than 1/4 point on each trade - after 5 trades - 1 of these 5 trades will show a profit to offset those 4 losses - if properly executed.…
Once you have established a good winning portfolio and have a bank roll (especially with what are called RANGERS) you can then take more chances and let the stock RANGE UP and DOWN more and rely on those suggested "Stop Loss Orders" and exit points…
Holding & hoping will not work as a professional Day Trader - you will lose in the long run...
Be mentally prepared to take a loss and move on…
#14. Never Get GREEDY!
If you have a nice gain take it and move on!
Greed is the major down fall of a rookie and in this business a 1/2 to 1 gain on a RUN is fantastic. Those rookies who get greedy and look for more normally lose!
23 Rules To Follow For Your Survival
As A New Day & Stock Trader!
#1. Rule Number One Is "Follow The Rules"!
Most Rookies have the URGE to jump right in during the first few days and start trading using real money.
It looks easy.
We will guarantee if you DO NOT precisely follow the rules in this lesson you will not survive!
#2. First Determine How You Want To Trade!
You need to determine the most appropriate for your trading personality.
#3. Find ONE Trading Technique To Stick With & Become Very Good At It!
Many times a ROOKIE will jump around from one trading system to another (grass is always greener on the other side of the fence) only to discover the first trading system they chose was the best. Normally they are out of money by the time they determine this so follow this very important rule…
For example "Resistance (r/p), Support (s/p) and The Cup & Handle (c/h)" plays. 95% of our profits come from those plays!
#4. Paper Trade!
What is typically called "Paper Trading" is either writing down a stock you would consider trading with real money on a piece of paper determining the entry and exit price or better yet entering them into your broker execution simulator…
This exercise will acquaint you with your broker execution program as well as establish and become familiar with the type of stocks in the day and stock trading system you want to use…
A. Select the stock(s) and either write them down on paper or enter them into your broker execution simulator.
B. Make sure you enter the trade using "Stop Loss Orders" and any other type of trading procedures you normally would use as if you were using real money.
C. Multiply this trade by the number of shares of stock(s) you would normally buy.
D. Paper trade or use your broker execution simulator for about 2 to 3 weeks or until you are at least 75% proficient.
#5. Trading With Real Money!
What you will discover is actual Day Trading (with real money) is MUCH harder and DIFFERENT than Paper Trading with a simulator. Now you are dealing with your hard earned cash and you are emotionally involved.
Each time you press the button to buy or sell you have to strike a reasonable balance between FEAR and GREED.
A. Initially trade in quantities of not more than 100 shares and do not, for the first 20 executions, trade more than 20% of your capital until you hit a 75% proficiency rate, then keep moving your shares up 100 at a time until you then again obtain the same 75% proficiency rate.
This way you will build confidence. You will get a feel on how easy it is or is not to catch an order. Always remember the simulator will most always catch an order at your intended entry level. The REAL broker execution program does NOT!
True you may NOT make much money on your first 20 trades and, in fact, you may lose money after you pay the broker commissions but what you will learn with this very important lesson is…
"You Must Experience & Learn First Hand How Using Real Money With The Actual Broker Execution Program Works" with the LIMITED RISK of only 100 shares!
One wrong click of the MOUSE with 1,000 shares could cost you thousands of dollars - one wrong click of the mouse with 100 shares maybe only 100
#6. Always Use A "Limit Order"!
Never use a "Market Order" as Market Orders can catch a stock at the TOP of a move and cost you BIG TIME.
#7. Use "Stop Loss Orders"!
#8. Do Not Chase!
At the beginning you will miss a lot of GREAT PROFIT OPPORTUNITIES and become very frustrated seeing those stocks run for 1 to 10 points. DO NOT give up or deviate from this rule as eventually you will learn how to catch those fast moving stocks!
If you have determined your entry and initial execution price is $20 and you have missed that price using a "LIMIT ORDER" DO NOT FOLLOW A STOCK UP PAST YOUR INTENDED EXECUTION PRICE!!!
There are exceptions and as you learn how a stock moves and reacts to what is called a "Break Away" you may be able to add 1/8 to 1/4 to that entry point but at the beginning "You Must Stick To This Rule Of Not Chasing A Stock"!
IMPORTANT - If it's easy to catch a stock chances are it will FALL. The odds say, as a rookie, if your first few clicks of that mouse does catch a stock you probably have bought it at the TOP of a move and it will FALL. Be ready to take a small loss and move on.
#9. If You See RED - Do Not Trade!
RED indicates SHORTING opportunities and Rookies should NOT SHORT until they better understand this technique!
If any one of the following three Indicators are WEAK or DOWN (in the RED) do not trade... DOW Jones - NASDAQ - S&P 500 Futures - sit back, relax and LEARN!
#10. Do NOT Trade Against The TAPE!
In other words if the market or a stock is trending down DO NOT GO LONG on a stock. If the market or stock is trending Up DO NOT SHORT a stock. The odds are against you if you "Go Against The Tape"!
#11. Use Discretionary Capital Only!
Capital set aside for Housing, Food, & Day-To-Day necessities should NOT be considered for trading!
#12. Diversify!
This rule is more for those who choose to build and hold a stock portfolio over-night. No more than 20% of your funds into one stock!
The magic number for diversification is FIVE (5) and you will learn if you are a Day Trader and follow the RULES the number FIVE (5) will present itself on several occasions.
#13. Minimize Your Losses - Maximize Your Gains!
Of all the rules you will learn in this lesson this one should be at the TOP of the list!
Most Rookie Day Traders end their new career EARLY because GREED influences their decision making process!
When Day Trading we suggest you minimize your losses and maximize your gains by NOT allowing a stock to lose more that 1/8 or 1/4 once you have purchased it and it decides to correct and go the opposite direction.
Just because we give you a suggested "Stop Loss" on certain stocks does NOT mean you have to wait for these Stop Loss Orders to kick in to exit. As a ROOKIE you MUST minimize your LOSSES by keeping them to 1/8 to 1/4 on each trade or you will be out of business in a short period of time.
Here's an example....
· Using the denominator of FIVE (5)...
· 4 losses at .25 with 100 shares = 1.00 point or $100…
· 1 winner at 2 with 100 shares = 2 points or $200…
Over-all you would have more losses than gains but you will be $100 ahead…
We have determined if you follow the rule of losing no more than 1/4 point on each trade - after 5 trades - 1 of these 5 trades will show a profit to offset those 4 losses - if properly executed.…
Once you have established a good winning portfolio and have a bank roll (especially with what are called RANGERS) you can then take more chances and let the stock RANGE UP and DOWN more and rely on those suggested "Stop Loss Orders" and exit points…
Holding & hoping will not work as a professional Day Trader - you will lose in the long run...
Be mentally prepared to take a loss and move on…
#14. Never Get GREEDY!
If you have a nice gain take it and move on!
Greed is the major down fall of a rookie and in this business a 1/2 to 1 gain on a RUN is fantastic. Those rookies who get greedy and look for more normally lose!