Five Core Components of a Trade Setup
Now you have become more flexible in your trading. You no longer define yourself in such rigid terms as day, swing, or position trader. You have become more of a market specialist. You have found the few markets that you want to trade and you now find yourself open minded to the daisy chain effect that bears on the markets you watch. Are you ready to get started yet? Not quite.Steps for Money Management in Trading
Money management is simply how you treat the capital that you use when you are trading. It is meant to be a guideline for what you will do regardless of whether your money sits idle, you are in a winning trade, or you are in a losing trade.Set Up Your Test Account
While demo trading and paper trading have a place, the best thing you can do for yourself is to set up a test account. Don’t bet the whole farm, simply a portion of it to get a feel if trading is for you. The reality is that trading futures and forex is not for everyone. The majority of them would be better off having someone managing their investment portfolio.
Trading is not easy. In fact, it can be one of the most difficult endeavors anyone can take on. Whether you have been trading for 6 months or 30 years, bad habits have a tendency to creep up. While there are many ways to lose money in the markets, there are 10 common mistakes that every trader, new or experienced, makes over and over again. When you can identify the mistakes, you give yourself a leg up in making sure they don’t affect you.Collars, Straddles and Strangles – Risk Management Strategies
A collar trade occurs when you combine a hard stop tactic or a synthetic call or put tactic with the selling of an option. This is a way for you to get the market to pay for your option that you are using as an insurance tool. For smaller accounts, this is a way to offset the cost yet still relish in the protection.