Been meaning to jot these down for w a while. Think I'll make this a permanent post - add (or subtract) to it as ideas occur to me...
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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