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TradingPub’s Rules to Live By

Site Administrator | August 25, 2011

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We thought it would be a good idea (especially given the current volatility) to share some of the top trading rules we have learned over time.  Please note that we did not come up with all these rules but have learned them from years of experience and thanks to other traders along the way that took the time to share with us.  We thank all of the traders that come to the TradingPub to share from their experience in order to help educate other traders.  Let’s get down to business:

Rules the Pub likes to follow:

1.)    Always manage risk and trade with a stop or hedge

2.)    Remember Enron, World Com and Lehman (not every stock comes back)

3.)    Do not double down on a losing trade

4.)    Do not place bracket orders before news (the sweep can end up hitting your order before the release)

5.)    During Extreme volatility the best way to reduce risk is to reduce size

6.)    When a trade is taken know where you are wrong

7.)    When a trade is taken know where you are right (have a target)

8.)    Always have a plan for a worst case scenario in any trade

9.)    Do not sell more premium than you are comfortable owning a position of (without a hedge)

10.) If selling premium and the instrument goes in the money make adjustments or exit

11.) You are not the smartest person in the room

12.) Trading is not easy, devote time to studying the market and reviewing your trades

13.) Don’t trade what you don’t understand

14.) A margin call is a sign your trade is not working

15.) For speculative accounts regularly wire out profits

16.) Don’t short parabolic rallies or buy parabolic dips

17.) Walk away when it’s not your day

18.) Don’t chase trades

19.) The market is not against you

20.) Do not roll options just because you do not want to take a loss (that money might be better off somewhere else)

21.) Money made in one stock spends the same way as money made in another

22.) Learn from others but don’t let them control your trade

23.) Give back to others

24.) Always know were support and resistance are as well as any news reports

25.) Each trade is one out of 1000, after the trade learn from it and then move on to the next one

We hope that these rules can help you as you continue to strive to be a better trader.  Regardless of whether you trade in stocks, futures, options or forex, these rules can be applied to help you manage risk and protect your capital.  Always live to trade another day.

Cheers,

The TradingPub

“Trade, Talk, Learn – Cheers to Success”

Disclaimer: Article intended for traders and not English majors. Disregard any misplaced commas.

We thought it would be a good idea (especially given the current volatility) to share some of the top trading rules we have learned over time.  Please note that we did not come up with all these rules but have learned them from years of experience and thanks to other traders along the way that took the time to share with us.  We thank all of the traders that come to the TradingPub to share from their experience in order to help educate other traders.  Let’s get down to business:

Rules the Pub likes to follow:

1.)    Always manage risk and trade with a stop or hedge

2.)    Remember Enron, World Com and Lehman (not every stock comes back)

3.)    Do not double down on a losing trade

4.)    Do not place bracket orders before news (the sweep can end up hitting your order before the release)

5.)    During Extreme volatility the best way to reduce risk is to reduce size

6.)    When a trade is taken know where you are wrong

7.)    When a trade is taken know where you are right (have a target)

8.)    Always have a plan for a worst case scenario in any trade

9.)    Do not sell more premium than you are comfortable owning a position of (without a hedge)

10.) If selling premium and the instrument goes in the money make adjustments or exit

11.) You are not the smartest person in the room

12.) Trading is not easy, devote time to studying the market and reviewing your trades

13.) Don’t trade what you don’t understand

14.) A margin call is a sign your trade is not working

15.) For speculative accounts regularly wire out profits

16.) Don’t short parabolic rallies or buy parabolic dips

17.) Walk away when it’s not your day

18.) Don’t chase trades

19.) The market is not against you

20.) Do not roll options just because you do not want to take a loss (that money might be better off somewhere else)

21.) Money made in one stock spends the same way as money made in another

22.) Learn from others but don’t let them control your trade

23.) Give back to others

24.) Always know were support and resistance are as well as any news reports

25.) Each trade is one out of 1000, after the trade learn from it and then move on to the next one

We hope that these rules can help you as you continue to strive to be a better trader.  Regardless of whether you trade in stocks, futures, options or forex, these rules can be applied to help you manage risk and protect your capital.  Always live to trade another day.

Cheers,

The TradingPub

“Trade, Talk, Learn – Cheers to Success”

Disclaimer: Article intended for traders and not English majors. Disregard any misplaced commas.