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Category Archives: Risk Management
Sell in May and go away
The S&P 500 continues its descent within a well defined channel. So far, if you sold the very first trading day of May you would be very happy. Continue reading
Posted in Risk Management, Trade Entries, Trade Planning
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Are you getting feedback?
What kind of feedback are you getting?
Besides the obvious P&L in your trading, there are other metrics you can use to improve your results. For example, do you know what your winner to loser ratio is? Is it more than 3? Or less than 1? Continue reading
Posted in General Info, Risk Management, Trade Analysis
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What is your trading expectancy?
Expectancy is basically how much a trader can expect to profit or lose on a trade based on past performance. Successful traders have a high positive expectancy. Continue reading
What is at Risk?
The objective in trading is to make money. But capital preservation is really what keeps a good trader in the game. Quantifying the maximum potential loss before entering a trade is critical. A good rule of thumb is to risk at most 2 % of the total trading capital in any given trade, but a trader often takes into account margin and minimum capital requirements. The idea is that a down turn in the market won’t take the trader out of the game.
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Posted in Risk Management, Trade Entries, Trade Planning
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Know what works
The ultimate measure of trading success is the bottom line. However, there are other key measurements and statistics in trading that can point to weaknesses in a trading plan.
October Performance Review
I can’t believe October is gone. Here is my trading performance analysis for the month. Continue reading
Posted in Risk Management, Trade Analysis, Trade Planning
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July performance analysis
Interesting month July. There were lots of really good setups that work great, but also many of them failed. And with failed moves come fast moves. I got stopped out of a lot of trades when breakouts failed. But I also was able to capture some great moves. Like IDT, ENTR and PWER. Positions were smaller than usual because I wasn’t sure if the market was going to move higher. I began to look at the S&P 500 E-mini futures for some clues and found that the 60 min chart with the 60 MA provided some insight for market direction. Continue reading
Know Your Setups
I often wondered how well I traded a particular setup. Do I anticipate and get in too early? Do I enter too late and miss the move? Looking at and reviewing past trades can help bring light to aspects of trading that need improvement. Continue reading
March Performance Review
In this month’s performance analysis I began to use the “Expectancy” measurement as a way to incorporate both “Batting Average” and good R/R. Continue reading
