GK, you wrote:
"MML - purchased @ $2.22, it rose to 2.31 before dropping back, would have made a good day trade. . did you get it JONGO ? gold dropped to US$ 1324.00 today."
Today I resisted the temptation to take small profits in MML, NCM, and FMG as I have a higher target for each of them. Obviously it all depends on what happens this week on the global stage, but hopefully I won't have swapped an opportunity for a small profit for a small loss later in the week.
Not that a small loss bothers me, but I am not particularly content with small profits either. That is, I am endeavouring to improve my trading techniques such that I only cop small losses, but also bank large gains. My objective is to have a win to lose ratio of 3:1. That is, for example, win $3k on average, but only lose $1k on average.
Over the last few months I have had more wins than losses, but my winning trades have only generated an average $ gain that is marginally greater than my average $ loss. I suspect that this is due to myself over trading, trying too many experimental trades, and perhaps most significantly, due to the market being very choppy over the last 6 weeks or so.
What average win/lose ratio do you aim for when opening a new trade?
Do you set your initial stop loss with the above point in mind? I do, but in harmony with several other factors.
