Managing Profits

[Andrew Aziz 98]

A writes:

I have a question for you. I there any reason that would prevent us making 5 to 10K a day if we follow the same principles and master them? Do you see this as a scaleable formula?

 

No there is nothing to stop you, but remember during the day stocks getting more choppy. So as we go in volatility goes down and more chance of getting stopped out. So only barrier is the time of the day. I always stop when I hit my daily goal. Many traders will keep trading. This is only my style.

 

Also remember market is not liquid enough to trade with huge Buying Power ($1M). You can buy 1000 share, but u may not fill 10,000 shares.

[Andrew Aziz 98]

J writes:

I didn't catch today when you explained about how professional traders handle the daily 30%?

 

Professional traders are not allowed to lose more than 30% of their morning profit in the afternoon session. For example, if they are up $1,000 by 11 am EST, the max loss they have in their account for afternoon is $300. It is easy to give it all back to the market. It is written in One Good Trade book by Mike Bellafoire.

[Andrew Aziz 98]

C writes:

 

I am always taking profits too early and the move just keeps on going. Do you have any advice or strategy when it comes to taking profits more effectively?

 

It is a tough one.

 

One way is to hold some for 1 ATR, 2 ATR and 3 ATR if you really do not have any level nearby. If not, look at 1 min or 5 min trend change. When 1 min makes a new low, get out for low floats.