I often hear future's traders say that you should learn one market and if you are successful move on to another. But what if you trade equities - should you just focus on one? Or should you really be trying to find a setup and trade that setup over a handful of stocks?
A number of our traders focus on one or two stocks. It's like having other people coming to YOUR poker game vs. going to someone else's game each day. Heck, my Nephew makes good living just trading GE. Don
Be market specific or technique specific. Very difficult to be both multi market AND multi-technique unless you're on semi/auto pilot. Approach it like a boxer, would you rather hone a handful of combinations to effective precision OR know a bunch of punches that you couldnt put together consistently or know the best time to use them? Not all techniques are equally effective at all times nor are all markets created equal. Defining your terms will help a long ways to profitable trading.
Pick a good stock and trade it. I have been trading this way for years. I look for the easy prey and take advantage of them!
If you are going to trade equities I would pick 2 to 4 stocks and learn them inside and out. How do you pick them? You want at least one that in a bull market has been out performing the broad market. This in theory creates more upside potential for your longs. You also want at least one that historically loses more than the general market in a bear market. This allows for potentially better shorts in a down market. Of course past performance is not always indicative of futures gains but it can help.
Actually my prior comment pertains to swing and position trading. If you plan on day trading then yeah really 1 stock that typically has good intra day movement is all you need.
He is strongly disciplined guy. Winning is almost assured but not big. He not only knew how GE behaves, he feels it too.
There is a good reason besides the hassles of breaking into a new pit that MM's donât or didnât in the old days, roam around the floor trading here and there. It was always better to be an expert in the issues that traded in one pit learning the nuances and steady people at the table then walking into new issues all the time.
Focus on one stock. My trading results changed dramatically when I began to just focus on one stock. I even started studying financial reports of my company. Diversification is overrated imo.
I agree,. You have to determine the pros vs joes who to take your advice from. You could listen to the trader dressed in army pants and orange sneakers who looks like he doesn't bathe and end up with him in the end.