AI Snips
Chapters
Transcript
Episode notes
Stop Valuation
- Determine a stop price based on when your initial trade thesis is invalidated, considering volatility and market events.
- Don't place stops too tight or too far out, and factor in adequate time for the trade to develop.
Position Sizing and Risk Capital
- Base your position size on your stop loss and total risk capital.
- Risk a small percentage of your capital per trade to stay in the game long-term.
Averaging Down
- Never add to a losing position, as it can lead to catastrophic losses.
- Averaging down can create a terrible cycle of biased decision-making.