daytrade diaries... july 8, page-18

  1. 1,227 Posts.
    kb

    An interesting exersise to perform in your analysis is to look at the magnitude of your losses over time (also compare your win/loss ratio over time). In theory your losses should decrease over time as your experience improves. I found that if my ratio shows a "blip" in the current time period, there is an underlying cause. If the "blip" happens to be positive or negative, it pays to identify the factors that caused that blip.

    As an example, I have identified in my trading records, that one of the key blips lately has been caused by buying shares with too much volatility in a short space of time. These provided me with the biggest profits but also the biggest losses because there was too little time to enter in a stop loss, or the stop loss suffered a huge amount of creep. I have modified my trading style and imporved my averages as a result. I also never buy in the pre open as a result of that analysis.
 
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