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Strategies & Market Trends : Market Gems-Trading Strong Earnings Growth and Momentum -- Ignore unavailable to you. Want to Upgrade?

To: Dave Gore who wrote (5248)	2/25/2001 2:09:45 PM
From: Jenna	Respond to of 6445

Right Dave.. which is why I have some option call position and might add on Monday, if warranted. If all goes well, I will 'redeem' them for double or triple what I paid buy the caveat is that my loss is limited to the price of the purchase, and using scrupulous risk management, I could easily handle that loss. Had I bought 3 times the amount, sure I would up the possible gain 3 fold, but also the loss. Traders don't realize that a great deal of trading success depends on your personal liquidity. If you are trying to get back losses and took out a home equity loan to finance more trading, or have already taken losses in the tech sector and are waiting to rebuy some of those depressed stocks, its emotions leading and that is not the way to trade. You can't trade or even invest in anxiety, hysteria, gambling frenzy, in a 'must make this trade or go bust attitude'.. Unfortunately we are all not given the same amount of 'cool heads' or 'liquidity, or have the same trading base from which to draw. Just like in all walks of life, some of us can take bigger hits with aplumb while others are counting their cash reserves on every trade. The market downfall has lowered cash reserves for many and that is a negative they will have to overcome if they are to take advantage of the promising trading and even investing (short term) opportunities that will open up in the next 4 to 8 weeks. I still think the money lies in swing and long term daytrading and not hopping into stocks in a mad frenzy to grab that point, which will be lost in the next mad frenzy. We should have the rationality and unemotionalism to hold through the most gain possible even in a daytrade everyone must look into themselves to decide if in fact they are scalping or just have a panicky trigger finger, and would have been better off holding a bit longer or just not overtrading. That can not be stressed enough. Hopefully in the Education room and even on this thread, we can hope to post more articles on the Psychology of Trading and putting a check on emotionalism and the 'Las Vegas' approach.