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How to locate every Day Trading System that Works
02-14-2018, 03:44 AM
Post: #1
Trading with something can significantly improve your chances of earning money in the areas.

The following challenge is always to find a daytrading program that works. You have the opportunity to choose from more than 300 trading programs available to-day. Unfortuitously only 10% of them are trading profitably.

Within the next 3 minutes I will present you the 10 Power Principles for Successful Day Trading Systems, which will assist and assist you in your research.

Rule #1: Few rules - clear to see

It may surprise you that the most readily useful daytrading programs have less-than 10 principles. The more rules you have, the more likely you 'curve-fitted' your trading system to the past, and this kind of over-optimized system is extremely unlikely to create gains in real markets.

It is important that your principles are easy to understand and execute. The markets may move quickly and act very wild, and you will not need time to calculate complex formulas in order to produce a trading decision. Take into consideration effective ground traders: The sole instrument they use is just a calculator, and they make a large number of dollars every day.

Concept #2: Trade electric and liquid markets

We strongly suggest that you deal digital markets because the profits are lower and you receive instant fills. You need to find out as quickly as possible if your order was filled and at what cost, because according to this information you plan your exit.

You should never place a leave order before you understand that your access order is filled. You may need to wait awhile before you get your fill when you trade open outcry markets (non-electronic). By that point, the market might have already turned and your profitable trade has turned in to a loss!

When trading digital areas you receive your floods in under one second and could quickly place your leave instructions. Investing liquid markets you can avoid slippage, that will save yourself you hundreds or even thousands of dollars.

Theory #3: Make steady profits

You need to always locate a trading system that provides a nice and easy equity curve, even though in the future the online revenue is somewhat smaller. Most-professional dealers prefer to get small profits every day as opposed to big profits every now and then. If you trade for-a living, you need to pay your expenses from your trading profits, and thus you should frequently deposit profits into your trading account.

Making steady gains may be the secret of successful investors!

Theory #4: Maintain a healthier balance between risk and reward

Let me give you an example: If you visit a casino and bet everything you've on 'red', then you have a 49% chance of doubling your hard earned money and a 5-15 chance of losing everything. The same applies to trading: if you are risking a lot You can make a lot of money, however threat of damage is extremely large. You have to look for a healthy balance between risk and reward.

Let us say you define 'damage' as losing 20% of one's account, and you define 'success' as making 20% gains. Having a trading program with past performance results enable you to assess the 'risk of damage' and 'possibility of success.'

Your threat of ruin should be always less than 5%, and your chance of success should be 5-10 times greater, e.g. if your threat of damage is 4%, your chance of success must be 40% or maybe more.

Theory #5: Locate a system that produces at-least five trades each week

The bigger the trading frequency the smaller the chances of having a losing month. Should you have a trading system that's a winning percentage of 700-800, but only produces 1 trade per month, then 1 loser will do to have a losing month. In this example, you might have many losing months in a line before you finally start making money. In the meantime, how do you purchase your bills?

If your trading system produces five trades per week, then you have on average 2-0 trades per month. Having a winning percentage of 70-ss - your odds of a winning month are really high.

That is the goal of all traders: Having as many winning weeks as you are able to!

Concept #6: Start small - develop big

Your trading system must enable you to start small and grow big. An excellent trading system allows you to start with one or two contracts, and then raise your place as your trading account increases. This really is in contrast to many 'martingale' trading systems that want increasing place styles if you are in a losing streak. Clicking small blue arrow likely provides suggestions you should use with your sister.

You probably found out about this strategy: Double your contracts every time you drop, and one winner will win back all the money you formerly lost. It is perhaps not unusual to have 4-5 losing investments in-a row, and this could already need to trade 16 deals after only 4 losses! Trading the e-mini S&P you'd then need a merchant account size of at least $63,200, merely to meet up with the margin requirement. That is why martingale programs do not work.

Concept #7: Automate your trading

Feelings and human problems would be the most common mistakes that investors make. By all means you have to avoid these mistakes. Specially all through fast areas, it's important that you determine the entry and exit points fast and accurately; otherwise, you may miss a business or get in a losing situation.

Therefore you should automate your trading and locate a trading program that both already is or could be automated. Automating your trading helps it be free of human feeling. The buy and sell procedures are typical automated, hands-free, without any manual interventions and you can be sure you make gains when you must according to your program.

Theory #8: Possess a high percentage of winning trades

Your trading strategy should make over 506 winners. There's no doubt that trading systems with smaller earning percentages could be profitable, too, but the emotional pres-sure is tremendous. Taking 7 losers from 1-0 trades and not doubting the system takes good discipline, and many traders can not stand the pressure. Following the sixth loser they start 'improving' the machine or stop trading it entirely.

Specifically for beginners it is a large help to acquire confidence in your trading and the body if you have a high winning percentage greater than 65%.

Rule #9: Look for a system that is examined on at the very least 200 investments

The more trades you use in your back-testing (without curve-fitting), the greater the chances that your trading system can succeed in the future. Look at the following table:

Number of Trades 50 10-0 200 300 500 Margin of Error week or two 10% 7% 62-40

The more trades you have in your back testing, the smaller the margin of error, and the greater the possibility of making profits in the future.

Rule #10: Opt for appropriate back-testing time

I recently saw the following ad: 'Since 1994 I've taught tens of thousands of traders worldwide a Straightforward and Reliable E-Mini trading method.'

That is very interesting, because the e-mini S&P was introduced in September 1997, and the e-mini Nasdaq in June 1999, thus, none of those agreements existed before 1997. What kind of e-mini trading did this merchant teach from 1994-1997???

The same applies to your back testing: If you created an e-mini S&P trading method, then you should back check it just for days gone by 2-4 years, because although the agreement has existed since 1997, there was virtually nobody trading it (see chart below ):

Now you know how to separate the con from great working trading systems. Through the use of this record you will easily determine trading systems that work and those that will never make it.

Authors name

Markus Heitkoetter

Author's Info:

Markus Heitkoetter is the CEO of Rockwell Trading and a 19-year veteran of the markets. For more free information and guidelines and trick how to make steady gains with online daytrading, visit his website http://www.rockwelltrading.com..
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