Tried taking no losers and averaging down, much smaller account, but eventually you'll get a move or a gap down / up that'll hurt you big time, guessing if in loss you hold over the weekend ?? Makes good money, might give it another try, but alas sooner or later all profits gone in no time No idea how to avoid this either.
I try to trade low p/e and high dividend companies to limit downside. I stay away from things like biotech.
General oversimplified pro tip: Any strategy entailing consistent/predictable profits is subject to a blowup somewhere, maybe unseen. You need protection/insurance. Don't fool yourself, you cannot ever encompass where you'll get ruined from, but its there. You're taking hidden risks. General oversimplified pro tip: Take all the risks you want but make sure to show up tomorrow. Never cross a river if it is on average 4 feet deep. You want the returns of the market? You need either infinite pockets or infinite staying power (2 things a individual trader/investor does not have). Insure yourself (thus sacrificing some alpha but at least you get some alpha, and better sleep) otherwise you won't catch the alpha you think you're catching and gaining. Think of it as a loan from the market to you and will be called back soon with interest. Hah. You own a car (an asset, albeit not a good one to possess from an investors perspective), you insure yourself against an accident (insurance), you hope an accident doesn't happen(who does?), but if it does.. you insured yourself against the EFFECT. Perfectly rational decision... do the same with your $.