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Strategies & Market Trends : Strictly Buy and Sell Set Ups -- Ignore unavailable to you. Want to Upgrade?

To: profile_14 who wrote (1557)	1/3/2005 10:28:20 PM
From: chowder	Respond to of 13449

Profile, I'm not surprised that there are more losers than winners. I've studied many different styles of trading and they all say you will have more losers than winners if you are trading correctly. For example, Pristine.com had 277 winners and 347 losers for all of last year yet showed a profit. There are several reasons for having more losers than winners, one being that money isn't being tied up trying to hold on until a loser becomes a winner. The ego trader may throw more money at a bad trade in order to correct a mistake. In that case you are increasing risk and if it doesn't work out, the losses increase. From the studies I have read, the better trades are the ones that turn profitable immediately. This has been my experience as well. Therefore, if a trade doesn't work out immediately, I'm out. I've cut a couple of trades for a loss that eventually would have been profitable if I held on. BBI is one of those trades. On the other hand, there were a couple of trades I closed that turned worse after I dropped them. To be consistently profitable as a trader, (key word being consistently), number one priority is managing risk and then having the discipline to follow through. You don't need big gains if you have small losses. I have heard several master traders say they aren't interested in your winners, they can judge you as a trader by how you handle your losses. We see examples all the time where people are excited that a stock they own is up 20% on the day and they still aren't even because they held it as it dropped 40%. Everything I've read on tactics and strategies says that a successful strategy needs to be able to show a profit when you losers are greater than your winners. A better winning percentage takes care of itself. It's the losses that need to be managed and how well we manage them tells us how good we are as a manager, or not. I do add to positions in my long term portfolio but not my short term. I mentioned a few weeks ago about adding Q to a position I was already up 30% on. dabum