The Tao of PazzoMundo
Posted on 06 August 2009
Been meaning to jot these down for a while. Think I’ll make this a permanent post – add (or subtract) to it as ideas occur to me…
1) Research – never enter a position on a whim. If you can’t point to the exact reasons for a position, then why be in it?
2) Risk – never bet the house. The ‘chip away’ strategy is the trader’s variation on compound interest. Lotsa small wins will add up – without the pin risk of a single lottery play.
3) Time – time is money.
Know the timeframe before entering a position. Is it a trade or investment? If its a trade – play to that timeframe – be patient, don’t rush it – but if it doesn’t meet the objective in its allotted time, close it out.
4) Sentiment – bet against the market at extremes.
The simple question should always be ‘where are the stops’? If the indicators suggest the market is all one way – then the probabilities lie with the contrary position.
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