Implementing Money Management

Bennett McDowell Implementing sound money management encompasses many techniques and skills intertwined by the trader’s judgment. All three of these ingredients must be in place before the trader is said to be using a money management program along with their trading. Failure to implement a good money management program will leave the trader subject to … Read more

How to Stay Objective in your Trades

Doug Hirschhorn, Ph.D. Perhaps one of the most challenging skills in becoming a successful trader is Maintaining Objectivity in trades. While there are a variety of factors which contribute to you losing objectivity in a given situation, there is a clear and defined path you can follow to re-gaining it. In simple terms, it is … Read more

How to Develop a Profitable Trading System

In this article we will explain to you how to develop a profitable trading system in five steps: Step 1: Select a market and a timeframe Step 2: Define entry rules Step 3: Define exit rules Step 4: Evaluate your system Step 5: Improving the system Let’s take a closer look at these steps. Step … Read more

How long should you backtest a trading system?

I am frequently asked how long one should backtest a trading system. Though there’s no easy answer, I will provide you with some guidelines. There are a few factors that you need to consider when determining the period for backtesting your trading system: · Trade frequency How many trades per day does your trading system … Read more

How do I close out a trade?

Retail forex transactions are normally closed out by entering into an equal but opposite transaction with the dealer. For example, if you bought Euros with U.S. dollars, you would close out the trade by selling Euros for U.S. dollars. This is also called an offsetting or liquidating transaction. Most retail forex transactions have a settlement … Read more

How To Get What You Want When Trading

Power in trading is a fascinating and often misunderstood concept. In general, it involves the capacity to cause something to happen, and effect change. Market movers are able to exert power in the marketplace, but so can individual traders. Individual traders can couple their moves to the power of those able to move prices. However, … Read more

How Prices Are Quoted

Futures prices are usually quoted the same way prices are quoted in the cash market; in dollars, cents, and sometimes fractions of a cent, per bushel, pound or ounce; in points and percentages of a point for financial instruments; and in terms of an index number, for stock index contracts. Be certain you understand the … Read more