Trading Style

No one can go on trading at top speed all the time!

Good trading is not enough to succeed in the markets. The secret to successful trading is in great money management. The skill of money management is required because the real business of trading is making money with money through controlling risk. And an integral part of great money management is a great risk management strategy. The heart of that strategy is the magic 2 percent. So why two percent?

There is a book out there about "Random Walk Theory". I haven’t read anything about it but I would presume that the book would shoot down any prospect of a predictable market theorem.

When you trade, you trade objectively, taking in mind the market consensus from news, fundamental analysis or technical analysis: As a trader, you shouldn't be concerned about market downturns or booms. When you trade, you trade objectively, taking in mind the market consensus from news, fundamental analysis or technical analysis and simply trading that view. You have the choice of trading each style specifically or trading a combination of each technique, taking in the news as well as the fundamental information.

You have a choice on which style of trading you would like to adapt in your own trading in the stock markets. (Or the forex markets if you're adventurous). That is either to trade fundamentally or technically. Some traders like to mix it up a bit and trade a hybrid system that takes into consideration both the company situation and the chart behaviour. I like to do a bit of hybrid trading myself but in the end, the chart behaviour rules my trading system. In the next few posts I will be hashing through the many maxims and trading lessons that I have found to be true from my own trading experience and that other traders always seem to crow about in various books, seminars and tapes. So stick around, I hope you will pick up a few new tips.

Depend on the numbers not the news

This may be a contradictory statement to the above about hybrid trading, but don't fall into the trap of depending on the news too much if you are trading technically.

All traders are after the holy grail of share trading. If you are trading and not seeking that holy grail of trading, well what are you after? Are you after excitement? Are you after an adrenalin rush? Anyway, as I've established before, the markets is all about making money, and to make money you need to be profitable in your share trading. So I'm going to assume from now on that all share market traders are in the markets to make a tidy profit. And therefore all traders are after the holy grail. And some may have already have found that holy grail of trading stocks in the markets.