dekac

Hi Traders

One of the most important jobs as a trader is to control your risk exposure. Sure, controlling risk is a concept you must use in any type of trading, however in day trading you must look at this issue from a different angle. Since your job is to capture various price swings during the day naturally your profit objectives will be much smaller then of a swing trader (who places a single trade aiming for a much larger profit objective)....
So, when placing several trades during the day it can be easy to “drift” away from your pre-determined stop losses. A common (very common actually!) day traders thought is “if I extend my stop loss just a bit I hope the market will turn around”! Hope is one of the trader’s biggest enemies.
These little extensions of stop losses add up and suddenly without noticing you are losing more dollars per trade than planed making your risk/reward ratio turn against you.

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JoseLeon

I agree with you, but you must also mention that not all brokers are honest with these stop losses and the trader must find a good ECN broker to avoid tricks from them and so losing money (stop hunting, etc...).

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jazzz

Yea right.... most of the broker only view their gains and may put their trader on tough positions. My Broker is very good at this part. They manage their job very well thus keeping eye on every trade and suggest the best remedy for any loss incurred.

Regards

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dekac

Hi Traders

Regardless of how you make your decisions you need to proceed with confidence tempered with caution. Whether you use technical analysis or fundamental analysis or flip a coin, it really doesn't matter as much as developing your own investment strategy, and proceeding with it until you are sure it is working or failing. Do not take council of your fears, and bounce around with no pattern, overreacting to every setback. Nor should you grow overconfident and let a small temporary success lead you into foolishness. Remain constant and stick with your plan....

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jazzz

yea right..... sticking to the plan is very important..... changing strategy frequently can really damage trades.

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