Thought I would update a little since may be of interest. I have been looking a little over my strategy, numbers and trades and trying to cull anything unhelpful and refine my process. I realised, and this may be a little antagonistic to the 'let your profits run' idea that something counter-productive to my swing trading was becoming attached to a stock and milking the profit as much as possible.
I popped some stats in an excel spreadsheet and I thought to myself, see when holding a stock continually you are effectively 'buying' the stock at that price by holding it because that money is tied up in that stock. There is also the issue that the higher a stock rises the more likely it is to retrace at some point.
So I thought, we all know how compounding small profits works but what if I start to take smaller % profit per trade and re-flip that initial amount into other high probability setups which yield another small %. The beauty here is also that lots of low-mid caps move in small % ranges so taking a consistent profit out of the ranges isn't hard to do and it prevents the trader from chasing bags or getting emotionally attached to bags BECAUSE lots of small % add up in the long run to bags..... Seriously pop your stats in excel and then profit percentages and have a play.
I started testing this strategy on my swing trades, which requires discipline and basically popping my sells in and stops in and not doing anything until the trade completes. I simply calculate my risk reward and started with a fairly small position size, even accomodating for the odd loss (which i keep tight relative to my reward) I am able to flip around 4-5 good positions a week and make significantly more than if I'm sitting on a mover that decides to stop moving. I am essentially trying to direct my capital to where it is working and removing it from these positions when the variables of the trade are no longer there. I am also applying the same to the odd day trade now and no FOMO or anything. Hope some of you might find this of interest.
