@Maverick74 Right. Like risking $1 to make $20 on Google stock. A good trader knows how to differentiate fantasy from reality
Risk is about evaluating the expected value of a trade measured against the opportunity costs of other uses of the capital being used for that trade accounting for time, discount rate and variance of the returns. Are you maximizing the next marginal dollar of risk given all available resources at your disposal? This is an incredibly exhausting process that goes waaaay beyond setting a stop order. LOL. And yeah, there is math involved.
Nope. This is what I'm referring to,. Neither of those numbers you provided are meaningful. Risking $1 to make $20 doesn't answer a single question I have about the trade.
I didn't mean it as a random bet. What I meant was that even with a perfect entry, you probably won't get to that $20 target. Not sure what you study, but I simply trade what I see
Holy moly, yeah that is too intense for me given my resources hahaha. Almost impossible as a retail trader. If you have some excel spreadsheet/formula that can calculate this, I'm all ears.
I can assure you that I don't need all that gibberish to turn a profit. It's overcomplication in my world. My old man came to the US as an illiterate with a 4th grade education and made millions through persistence and discipline. He doesn't know any of that shit
I wish you the best of luck. Make sure you have a backup plan career wise. Always the best advice I can give to young people.
Mark B Fisher, a very great and succesful trader, will tell you that of all the people he trained those who fail the most are those with degrees. The more degrees the higher the failure rate.