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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Sr K who wrote (33996)	3/12/1998 10:25:00 AM
From: Jim Patterson	Respond to of 176387

re: Three-quarters of one percent seems like low risk. It is low. I have done, seen, read, studied, a lot of system or black box type of trading systems. Most of them are only win about 35% of the time, 15-25% break even. that means they loose 40-50% of the time. The only way to be profitable is controll Total Capital Risk. IOM, The key to being sucessful in the long run is not to make money, it to avoid loosing money. Most importantly, avoid loosing big chunks at one time. For instance, In Feb, I had 2 blow ups, TRII and LGTY. With each one, I lost over 2.5% of my capital. 6% total. That puts me down 6% for the month with no other trading. Assume that every thing else goes about normal and I make my 3-4% monthly goal. I am still down 2-3% on the month. If thoes gaps could have been cut to .75% each, Net I am still up on the month. No one can completely avoid the gaps, they happen from time to time, I am just using them as an expamle. .75% is not a rule, it is a guide line. Use it for trade size or stop placement, Close stop, lots of shares or the other way. Of course you really need a lot of $$ to apply this. In my IRA, I don't do it as I would only be able to buy 200 shares with a $1 stop. This is part of the reason you don't hear of many people starting with $10,000 and becoming Billionairs. I think Stasticaly the number optimises @ about .65%. It also depends on your win %. Life time I am about 48% X-options. :) Hey look at that, Dell @ 62 1/2 ~ 10:14 AM. Jim