advice for a young trader ??, page-61

Excellent article Russian

One of the best I have read

I agree with the author's thoughts entirely

It is funny

Once you realise that things are actually quite simple in the market

And your trading plan reflects this simplicity

$$$$$$$ starts rolling in

Too many on HC over complicate things IMO

And don't know how to manage risk through correct money management and position sizing e.g don't plonk down a large position on a sub 1c stock as a pip or 2 move on the wrong direction might cost you $5k or more, wiping out a week or more's profits

Go small on the real mongrels in other words


A few of my other rules that I have learnt over time.........

sell at a predetermined profit target

Don't go in hard on illiquid stocks

Use stops - don't fight the trend. A stock that breaks a previously identified SL level will almost certainly go lower

Don't be fully invested in uncertain times with low volume

Don't chase a stock that has already run way past breakout

Most discussed stocks rarely provide profit

Go in bigger on liquid small/mid cap breakouts

don't buy in hard on the morning of a +50 pt open

Remember - the market is just one big cycle that repeats over and over

Never believe the story on the micros, it's all a lie. Mgmnt, registry, cash on hand, debt, recent raising details and who's net buying or selling in recent weeks is all that matters. Hot sector runs can provide amazing profits. Dont fight a sector trend e.g. Uranium in 2006/7 and the current mobile mania bunts action

Believe your gut over sticking too stubbornly to a predetermined plan - you need to be able to adapt to be a consistent winner. This takes experience

You will never take all the profit out of a move - a big chunk of a move is a great result

Get rid of the red stocks in your PF. You will thank yourself later e.g WAS

Let a penny run hard that is clearly in an uptrend with higher obv, increasing volume, higher lows e.g PAA. Don't forget to use a stop.

Multi year breaks are good. The longer the time frame before a break the better.

Feel the beat of the market. Each day/period of the year has a temp. Oe must trade according to this tempo. This takes time. Years.

Often a initial break can look weak and retest the break area before an explosive move up. Look for a higher low test of resistance then a higher high and explosive move up to next level of historical resistance.

Most people lose by not having a plan and being disciplined. Having a plan that is not the best in the world is better than having no plan at all.

Don't waste your time reading AFR, buying magazines or listening to so called experts on the TV. It's all spin. The media is never right.they also try and tell you no money can be made from trading micros. That is a lie.

Stocks always go higher in a bull run than people think. Conversely in a bear market stock always go lower than people think. Pick your timing. Back your judgment. Note: this takes years to understand.

Don't talk to friends and family about your trading. They don't understand. Keep your family, social and trading lives separate.talking to friends and family about a big win is very uncool.

Have fun. It's only money. Let out a few ridiculous phrases on the Hot Copper day trading forum on a regular basis. Ok daily basis. Life was meant to be laughed at. Far more important things to get all serious and uptight about.

Don't get too excited over a win. Don't get too down about a loss. Don't get cocky. Losers are cocky.

Believe in yourself. You can be a winner.

Note: these are my rules. They are not yours. You need your own rules. Everyone has a different trading style.

Good luck. Bring on tmrw punters......