Monday, March 17, 2008

Stock Trading Commandments

Never Turn Trades into Investment

When the market move against you, cut loss. When the you get it right, take profit. Don't be greedy. You won't know when it will turn.

Your First Loss Is Your Best Loss

When you trade turn awry, cut loss fast. The subsequent loss is likely to be more severe.

It Is OK To Take Loss When You Already Have One

Losses, realized or unrealized, are actual losses. Unrealized losses if not taken, may lead to bigger losses.

Never Turn a Trade Gain Into Investment

Do not be too greedy. Know when to get out. Market can turn anytime.

Tips Are For Waiters

Don't be fooled by hot tips.

You Don't Have a Profit Until You Sell (Close the Trade)

Paper gains can be wiped out when market swings.

Control Losses: Winners Take Care of Themselves

It is more important to pay more attention to losing trade and limit the losses. You don't have to worry too much for the winners.

Don't Fear Missing Anything

The opportunities will come again. Don't chase the price.

Don't Trade Headlines

News headlines are too brief and inaccurate. They just want to get it out quick. Read into details. The stock will not fly away.

Don't Trade Flow

Don't buy just because someone is trying to sell you and you think it is convenient. Do research before you buy anything.




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