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The Five Golden Rules of Intraday trading

Saturday, April 25, 2009 | Labels: | |


When you are in market then so many so called " Guru" teach you what ever they do. Market is place where no one perfectly knows what to do for success and earn money. Here Five Golden Rules are set up over the time by who beat the market and achieved big success.
I like to share this GOLDEN RULES for my readers;

The Five Golden Rules

1. Invest in the direction of the Trend!
The fastest and most risk free way to make money in the markets is to identify a change of trend in the market as early as possible, take your position, ride the trend and close your position shortly after the trend reverses.

Any market professional will tell you that it is impossible to buy at the lows and sell at the highs (or sell at the highs and buy at the lows) consistently, but with the Be happy !!, it is very possible to catch 60 to 80% of many intermediate term and long term market movements.

2. Cut Losses Quickly
In order to keep investing, you must preserve your capital. It is therefore important to keep the individual losses small in relation to the overall size of your investment.

The Be Happy tells you Money Management Principle and Stoploss Levels will ensure that you will never loose more than 1.0% of your investing capital in any single trade. This means that even if you make five incorrect investment decisions, you will still have 95% of your capital to continue investing.

3. Let Profits Run
Only the Be happy reader stays with profitable trends as long as possible because the trend is likely to continue and make your profits even larger.

Guarde against the possibility that prices will turn around and take away much of your accumulated profits before the trend actually reverses.

Trailing stoploss. This is a method of moving an exit point along some distance behind your trade.

The "Stop Loss" will let profits run while still guarding against the possibility that prices will turn around and take away much of your accumulated profits before the trend actually reverses. It is called a "trailing stop loss". This "Stop Loss" level is always some distance behind your trade. As long as the trend keeps moving in your favour, you stay in the trade. If the market reverses direction by the amount of the "Stop Loss', you exit the trade at that point.

Thus the "Trend Trading Picks" "Stop Loss" will always protect your profits by insuring that you keep 80% to 90% of the accumulated profit.

4. Diversify
Diversification for spreading risk and or increasing the odds of good fortune.

One diversify their portfolio over 10 different securities across different industry sectors having a low correlation with one another.

Spreading your risk between 10 different securities across different sectors reduces your odds of losing your entire capital on a single stock or industry sector.

Diversifying across different sectors is important because when the economy is digging itself out of recession, certain sectors whose profits are particularly enhanced by falling interest rates put in their best price performance. Then as the economy moves into the terminal recovery phase, the outperforming issues start to decline, but the market averages are buoyed by previous underperforming issues, which thrive in this kind of environment.

5. Manage Risk
Risk Management Strategy covers the most important element of managing risk by keeping your losses as small 1% of your trading capital.

Risk management Strategy ensures that you as a investor can continue to invest in the markets even after a couple of incorrect decisions. In fact if you follow "risk management strategy" you can continue investing in the markets for as long as you live. You will never ever have to worry about losing your entire trading capital.

Check out the performance to analyze yourself and see how you too can multiply your trading capital by investing in the long term trends of multi bagger stocks.

And Finally...

Be reader of Be happy by subscribing E-mail news letter, you can found success in your single trade also.

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