In your youth, you need to take risk to advance your career, whether you work for GM or work for yourself. However, you should be conservative in finance, live below your means and let compounding does its magic. In a big corporation, you don't become a VP by being conservative and play it safe. You need to take risk to be noticed. There are typically 3-4 levels from a worker to a VP. The probability of becoming a VP is 1 in 1,000 to 1 in 10,000, not a high probability, proven path to high pay and wealth if you don't take risk. IMHO, the right philosophy is to take risk: Up or out, because you don't have a lifetime to wait if you want to be in charge.
Traders who don’t manage their risks, risk losing everything. Traders can’t allow themselves to think only about profits. You should always count how much money you risk losing per trade and day. If you keep your potential losses limited, you will be able to stay in the market for a longer period and will have many opportunities to earn. Stick to the rule of 1% risk per trade. Stick to the rule and follow the plan.
One major mistake that I have observed people making, is that they keep over trading out of greed, which is not going to help them in any manner. They are bringing in more risk for themselves for sure.
I agree. Over trading is a bad idea. In fact many people invest so much money in trading that they expose themselves to so much of risk and ending up blowing their accounts altogether.
The worst one is risking too much capital on 1 trade. That is enough to blow out your account and it does not matter if your capital is $25,000 or $500,000. If you do not take care of your capital, you will blow it up trading. They recommend risking only 2% per trade. Others suggest risking only 1% if you are a new trader. That probably, will atleast, give you a chance till you figure it out.
Exactly. If you can’t manage risk, you will be wiped out with a blink of an eye. Risk management is that important. So determine risk tolerance levels for each trade for a better game.
Hour 1 - Special with host Steve Rhodes cued to go... https://elitetrader.com/et/threads/...ent-for-daytrading.340114/page-5#post-5029455