For a trader, winning is extremly dangerous if you haven't learned how to monitor and control yourself.

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Monday, February 16, 2009

Small profit in longevity

I find this rule very useful and want to share with you now especially if you are in full-time trading.

It's small profit in longevity, it's extremly useful in sideway market like now, since the general market is sideway, so this strategy is to help me make small profit from each trade in short term, basically I'll trade in small size(2~5 lots), holding 5 to 10 counters at the same time, there are longs and shorts, ( but with more positions in shorts since I believe all should agree market is generally bearish) and prepare to hold it 2 to 3 days on average, I continue find new positions and close those old ones( still got to maintain the total number of positions, don't over trade). By using this strategy, I can make at least 1~300 hundreds bucks per day, without much attention. I can don't look at it for the whole day, because the positions are small, one lose won't hurt me, and my other positions are making money(as u know sideway market most stocks don't move much or even don't move at all ), so overall i still making money. ( of course i got to select my candidates carefully, so usually my direction is right, say today i got 5 positions, only one postion losing money, the rest four are making me money, so i still got $300+ profit), in this way, i can make some $1~ $2k profit per week.

The most important point here is to stay in the market, as long you stay in the market, you got chance, once you out of the market, you are totally out of this game. There are times you can play big, and there are times you can play small. When you have big positions, you can concentrate on it and still keep those small positions with less attention.

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