Know Where I’m Getting Out Before I Get In
Написано EneaDoku , 18 Февраль 2017 · 133 Просмотров
“Know your surrender point.” Before you put on a position, you have to know the point at which you will give up to the market because the pain is too great.
One of the core money management principles is that before entering any position, predetermine the exit point based on assessment of where the market should not go if you are right about the trading idea. “I know where I’m getting out before I get in.”
Why is determining where you will get out before you get in so important? Because before you get into the trade is the last time you have complete objectivity. Once you get into the trade, you lose objectivity, which makes it easier to procrastinate by rationalizing a losing position. By making the loss-limit exit decision before he enters a trade, One ensures a disciplined risk control strategy and removes emotionalism from the money management process.
I know where I’m getting out before I get in.
2 Questions for you.
Answer in the comment section below, remember you can learn by reading but you will learn more by interacting with other people. I will make sure to reply to all of them.
- Do you determine the Target first or the Exit point?
- Can you recall any occasions that the stop has saved you ?