Take every win, don’t regret the lost profits, because the eel
can escape faster than you think. Joseph de la Vega, 1688, from an early
Trading Guides
Each trading strategy described on our portal is 100 percent useless without proper money management. We can tell you endless stories about very talented traders who went broke because of one or two bad trades. This happened to both of us at the beginning of our careers!
In our opinion, the biggest reason why traders win or lose is not because of their entry methods, but because of their money management skills.
By “money management” we simply mean keeping losses and capital depletion at an absolute minimum while maximizing opportunities
making a profit.
Money management, which is important for all investors, is even more important for short-term traders. Unlike long-term trend pursuers, short-term traders10 rarely make a large amount of money on any one trade. Therefore, unlike a trend chaser who agrees to a large depletion of capital in exchange for the possibility of making large profits at once, a short-term trader must keep losses to a minimum in order to ensure his survival.
If you keep losses to a minimum in each trade, you will already win the battle by 80 percent. All models featured on Investmagnates follow the same money management method. The following principles will ensure your success in short-term trading of any type!
1. Open the entire position at once! This means: if you trade multiple
contracts, open the entire position at the same time. Do not add to
winning positions.
2. Place the initial protective stop for the entire position one to two ticks lower
the most recent high or low. (The market should not go back to this
a certain level of support/resistance, or “risk point”!). Concrete
The choice of time to exit the transaction is a subjective issue. And here is the original
Protective stop is not a subjective issue.
3. Immediately start step-by-step exit of the trade when the market begins to move in
your direction. By withdrawing part of the transaction, you reduce the risk and take profits.
If you are trading a single contract, as you should if you are a beginner,
Move the floating stop to protect profits.
4. Attention – if the market begins to move in a parabola or makes a movement,
expanding the range, take profit from the entire position. It is very likely that this
culmination!
Range-expansion move is a very large bar caused by going to
the market of the last group of participants (emotional latecomers). After
This last group of traders appears, there is no one left who can continue to drive
prices up or down.
