lets discuss here why most of people lose some money.
I have the opinion, that the most trades lose money, bcs the have no plan to win.
lets look to all trading book, the most of discussions, everywhere are stated out, that you should not risk mor then x% of your money. That i will agree, you have to do risk managment. But the most important thing is, no one have a winning plan.
Lets say in this way, a lot of people say, let the winners run. this is maybe a point, but not a plan. Nearly nobody want to start a business without a business plan. I know, there are some projects on kistarter or some internet startup in the past where this was working. But in general, 99% of trders have a job. Most of them are not self employed. Most of them following a business plan from the managment.
In trading, you are your own manager. You have to make your own plan. A businees plan is always a plan. Noone of them will be fullfilled in time, relly nowone. This is like the 5 year plan from Russia in past communist years. No plan was fullfilled. But this isnt the question in my opinion. The mean thing is, you have to have plan. A plan should have goals. This goals must be hard to arrive, but not be impossibe.
Let me stay out, the most of the hedge funds make 10 till 100% a year. The funds with 100% you can count on one hand.
What is a goal? Is a goal to find daily profit? when yes, how much daily profit?
What comes after daily profit? whats happen if you pass the daily profit?
I think, a plan have to include more then one goal like
- daily profit
- weekly profit
- monthly profit
- yearly proft
- 2 years profit
- 3 years profit
- 5 years profit
and this goals have to be monitored regulary on daily, weekly, monthly, yearly base.
Why i think you should have to do this?
looks to the daily profit, yes you can pass it, also 4 days a week, but you can reach your weekly target.
you can pass your weekly target 3 weeks a month and you can reach the montly target,
even you can continue this.
but in general, you should arrive your target. f you cant arrive it continiusly, you maybe have to adopt it.
if you pass a target, looks to the next higher one and look if you can reach it. if the next higher one is impossible, adopt your targets.
feel free to discuss