Analyzing Risk Vs Reward before any investment is no.1 Priority. A same name can have good returns for someone else but for you can be no returns or a loser, reason being someone who has minimal risk and had best reward entry on a stock will do much better vs someone who heard about a name, likes the stock and bought it randomly anywhere without looking at risk reward, maybe got hit with drawdown, panicked and sold it.
So, Ask your self before you hit the button, what is "my risk and what is my reward". If you are risking 2 dollars to make make 1 dollar that is bad risk reward. Most of time traders dnt care how much they will lose, they just want to make something, focus is all on reward, that is completely wrong and not consistent.
Use technical with your fundamental conviction or market cap analysis etc to find best risk reward entries on investments For Trades, usually Technicals are good enough to identify best risk reward entry. If you cannot find Good Risk Reward, Ignore and move on.
1st Rule for Newbies. Every Trade You Take , Try to "lose" (if you lose) , a FIXED AMT every time. -"R" Then when you win, try to make 2R, 3R (r can be 100,500 etc.) Dnt matter how many times u lose, NEVER EVER lose more than "R" Find your R -"risk $" per trade
#tradingtips #R What a fixed R does for you is that makes Your trading Systematic, Methodical" You start trading, you load up, you lose bunch 2K here, 3k there, u win 6K after that and then you lose 500, and then u lose 10K! Stop! "Consistent Losers Bigger Winners
#tradingtips #R Now once you know u can keep Risk or loser consistent. Then find a trading system that when works, helps u win big and cover all ur loses. Win 2R, 3R etc. That system can be Long Momentum trading , Shorting, Options, Pattern Breakouts, Penny stock longs etc
