taking profits.....

[jcpoolgod]

I funded my trading account a few months back. Put 5gs ins....I made a few good trades and my account had 10,000 in it. I did not take profits because my initial analysis i thought i could make 20+grand on the trade.... so instead of making money on the trade i let it slowly disappear to nothing. my account now has 3000 in it. expensive mistake i guess hahah...what trading rules do you guys follow for profit taking?

..more on what i was actually trading.....(on this particular trade)
I bought 10 march wheat 700 call options. for 1 cent($50 each) i later sold 10 march call 800 calls for the same 500 risked. so a free trade....when this took off these options i bout were worth 600$....i just didn't do anything with it after. even though i lost all of these profits. i was trying to just still to my initial plan of attack....

oh well...maybe next time

 

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[vinylawesome]

 

[jpmartin]

Thought I'd share this, as the guy wrote this (1957) after decades of experience:

1. Don't speculate unless you can make it a full-time job.
2. Beware of barbers, beauticians, waiters—of anyone—bringing gifts of "inside" information or "tips."
3. Before you buy a security, find out everything you can about the company, its management and competitors, its earnings, and possibilities for growth.
4. Don't try to buy at the bottom and sell at the top. This can't be done—except by liars.
5. Learn how to take your losses quickly and cleanly. Don't expect to be right all the time. If you have made a mistake, cut your losses as quickly as possible.
6. Don't buy too many different securities. Better to have only a few investments that can be watched.
7. Make a periodic reappraisal of all your investments to see whether changing developments have altered their prospects.
8. Study your tax position to know when you can sell to greatest advantage.
9. Always keep a good part of your capital in a cash reserve. Never invest all your funds.
10. Don't try to be a jack of all investments. Stick to the field you know best.

This quote summarizes his perspective well...

The main purpose of the stock market is to make fools of as many men as possible.

 

[jcpoolgod]

well said haha

 

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[vinylawesome]

"The next greatest danger to a young business man in this community I believe to be that of speculation. When I was a telegraph operator here we had no Exchanges in the City, but the men or firms who speculated upon the Eastern Exchanges were necessarily known to the operators. They could be counted on the fingers of one hand. These men were not our citizens of first repute: they were regarded with suspicion.

I have lived to see all of these speculators irreparably ruined men, bankrupt in money and bankrupt in character. There is scarcely an instance of a man who has made a fortune by speculation and kept it. Gamesters die poor, and there is certainly not an instance of a speculator who has lived a life creditable to himself, or advantageous to the community.
The man who grasps the morning paper to see first how his speculative ventures upon the Exchanges are likely to result, unfits himself for the calm consideration and proper solution of business problems, with which he has to deal later in the day, and saps the sources of that persistent and concentrated energy upon which depend the permanent success, and often the very safety, of his main business.

The speculator and the business man tread diverging lines. The former depends upon the sudden turn of fortune's wheel; he is a millionaire to-day, a bankrupt to-morrow. But the man of business knows that only by years of patient, unremitting attention to affairs can he earn his reward, which is the result, not of chance, but of well-devised means for the attainment of ends. During all these years his is the cheering thought that, by no possibility can he benefit himself without carrying prosperity to others. The speculator on the other hand had better never have lived so far as the good of others or the good of the community is concerned."

-Andrew Carnegie

 

[Alleex_a]

Hello, for some good advices in trading, i'm starting a blog you can read, I post many courses and advices it's on www.a2xtrading.wordpress.com

 

[smarty]

I highly doubt Warren Buffet's wealth comes from investments and this post enforced my doubts.

 

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[snowbank]

I funded my trading account a few months back. Put 5gs ins....I made a few good trades and my account had 10,000 in it. I did not take profits because my initial analysis i thought i could make 20+grand on the trade.... so instead of making money on the trade i let it slowly disappear to nothing. my account now has 3000 in it. expensive mistake i guess hahah...what trading rules do you guys follow for profit taking?

you need bankroll management.

even if you have an edge, but don't have bankroll management, you can easily end up with $0 because you won't be able to handle the swings.

determine the amount needed to invest at a certain level, and don't invest above your head.

 

[TennisOrDie]

Hogs get fat, pigs get slaughtered.

I use technical analysis to determine entry and exit points.
I don't use set targets.
I don't hope the the price goes up. I don't hope that the price goes down. I just see what the market does and then I react to it.

I trade futures contracts because of the leverage they allow. I trade the ES, 6e and CL