Unfortunately the golden rules of trading are not the same as the golden rule; love your neighbor as yourself.
That rule will help you have success in life, but won’t help much in trading. In trading the 2 golden rules are:
1. Cut your losses short and let your profits run.
2. Use the discipline and system to tell you when to do both and by how much.
When you think about the golden rule of trading, it basically describes exits; how you abort losses and ride winners. When you think about money management, it basically controls how much you risk on any given trade and when to add onto a winning trend.
Anyone who says you can add to a losing trade to “average your losses in case it comes back” is a doomed investor. What if you did that while AIG crashed? You would be wiped out. Even if it did not crash that type of strategy would give you the false confidence to do it over and over until you finally did get one that wiped you out. Regardless of what anyone says a stock or ETF does not “always come back at some point in time.”
The trend is your friend and the sooner you learn to follow it the better. In the workplace many times the leader is the winner, but in trading the follower is the winner.
We are to follow the trends and trading signals. If you try to outguess and outfox the market you will be crushed. With that said I do teach one countertrend trade that does not have a high winning percentage. It is because it risks only 1% and many times targets 2-6%. With this risk reward ratio it is a great trading signal, but more importantly it helps my students catch the end of the trend when we use it as a reversal signal.
This is in addition to my regular trend trade that I teach. My trend trade has a much higher win rate and catches almost every single trend.
Even if you never join my 6 month mentorship program I know that following the golden rules of trading will help you.
Remember I have a 90 day money back guarantee according to the terms on my homepage.
Please email me for a free copy of my basic trading course.
Here for you,
Big A
{ 4 comments… read them below or add one }
I watched your video but did not find access to your “free spreadsheet” nor the other free items you indicated. The tabs ” contact”, “products” don’t work
MS
Big A
Your trades look professional but I wish you would update your website on a monthly basis. That would be a great help to those of us that have experienced a drag on our ability to profit.
mk
It’s on the home page under “Trading Tools”, email opt in for the free videos to get it.
Ron Berger
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I really liked your information, exspecially trader physicallogy. I am reading your aricles now, put have watched all the vidios.