Psychology in Trading

As you saw with position sizing, you can also decide how to allocate your money across various asset classes, also known as asset allocation. Asset allocation is the way you divide your portfolio…

Asset allocation is a critical component of investing success. Research suggests that it is the most significant factor in how the returns of a portfolio vary over time, and that it strongly…

Let us now look at the first steps you have to take to begin building a trading plan with a strict set of rules: Percentage of money to invest in each trade; Stp Loss; Take Profit; Risk/Reward. The first thing…

Have you ever had the feeling that, despite all the strategies you have learned and all the things you know about trading, you still have no idea how to manage a trade once you have entered a…

In the post on overconfidence, we saw what happens in a trader’s mind after a series of wins. Here we look at the opposite case: what a loss does to the person who suffers it, and how to avoid turning…

Now, let’s combine all the concepts you saw in the previous posts, so that you understand how to organise your trading. Doing this will keep your aims always clear in your mind, minimising the…