nubzster

In order to make money, you need to not be afraid to lose it. What do I mean by this? Simply that you have a money management plan where you can calculate the number of shares to buy/sell in relation to your entry price and stop loss so that the amount you risk losing is fixed...every time. For example, I have a trading account of $200,000. I tell myself I cannot lose more than 2% of that capital per trade, which is about $3800 per trade. What I do then is subtract my entry price from my stop price, then divide $3800 by that, which gives me the number of shares I can purchase. So, If DIA is trading at $100.00 and my trading setup indicates a stop loss at $99.50 is needed, I then subtract $100.00-$99.50 = $0.50. Dividing $3800 by 50 cents then gives me 7600 shares, which is how many shares I can buy that will result in a stop loss of $3800 if my stop is hit. (Not including commissions, of course.) If you do this for every trade you take (assuming your setup is a throughly robust and backtested system), you in essence 'fix' your loss per trade at a known number, which in my case is a meager 2% of my trading account (I would have to lose 52 trades in a row to lose all my trading capital, which is impossible with a good system!) This enables you to have the courage to take the trades you are required to by your system. Remember, money management is a key thing to keep from going broke, but again, you need a thoroughly backtested and robust system where the percentage winners and losers, as well as the win/loss ratio of the system all need to be accounted for in order to successfully trade. Once you have all these things coupled with flawless execution of your plan, you will begin to make money on a constant basis.