Stock Market Trading: The 20 Rules of Engagement
"Good traders know how to make money; great traders know how to take a loss," and 19 other truisms to trade by.
15. The only difference between being early and being wrong is whether you're there to collect.
There is a fine line between being early and being wrong -- it’s called the bottom line! This is not reactive rationalization; it’s proactive patience. If you provide a margin for error in your risk management protocol and properly size risk, you’re more likely to exhibit the patience necessary to let a trade evolve.
16. See both sides of every trade.
Someone once said that if you’re playing poker and you can’t tell who the sucker is, it's likely you. The same can be said for trading; you always want to know what the person on the other side of your trade is thinking, even if—and particularly if—you disagree with it.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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