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Before you start trading you should have a money management system. Like any
other business you have a business plan and the financial portion of that plan is
the most important. In this business your inventory is stocks, bonds, futures or
options. Like any other business you define what an acceptable loss is on an item
and what is an acceptable profit for the risk undertaken. Like any other business
if the item of inventory doesn't do what you expected it to do, you put it on
sale and liquidate it to raise capital to purchase inventory that will do what
you want it to do. Your acceptable loss is your stop. Your money management
system tells you how much that is. Your mark up is dependent upon your trading
system and trading style. It doesn't make any difference if you are a day trader
or an investor. Like any business, some turn there inventory 10 times a day,
some 20 times a year and some only twice a year. Your trading style and inventory
volatility will tell you what your turnover rate will be. Trading is a business
and if you treat it as anything else you will be a loser. Good luck, Ira
JMAXBragg@xxxxxxx wrote:
> I would like to get some feedback as to when traders should exit a trade gone
> bad in day trading, swing trading and long term investing. Your concepts and
> the reasoning for it would be appreciated.
>
> Thank you,
>
> john
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