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How to locate a Day Trading Program that Works
02-14-2018, 03:44 AM
Post: #1
Big Grin How to locate a Day Trading Program that Works
Trading with a system can considerably boost your chances of earning profits in the markets.

The next problem is to look for a daytrading program that works. You have the chance to pick from more than 300 trading systems available today. Regrettably only 10% of them are trading profitably.

Within the next three minutes I'll provide you the 10 Power Maxims for Successful Stock Investing Systems, which will help and assist you in your study.

Theory #1: Few principles - easy to understand

It may surprise you the most readily useful daytrading systems have less-than 10 rules. The more rules you've, the more likely you 'curve-fitted' your trading system for the past, and this kind of over-optimized system is very unlikely to make profits in real markets.

It's important that the principles are straightforward and implement. The markets can react very wild and go quickly, and you will not have the full time to calculate complex formulas to be able to produce a trading decision. Take into consideration successful ground traders: The only tool they use is just a calculator, and they make tens of thousands of dollars everyday.

Concept #2: Trade electric and liquid markets

We highly recommend that you trade electric markets as the commissions are lower and you obtain instant fills. You need to find out as quickly as possible if your order was filled and at what price, because based on these details you plan your exit.

Before you understand that your access order is filled you should never place a leave order. When you deal open outcry markets (non-electronic) you might have to wait awhile before you receive your load. By that point, the market might have already turned and your profitable trade has turned right into a loss!

When investing e-lectronic markets you obtain your fills in under one minute and can quickly place your leave orders. Dealing liquid areas you can prevent slippage, that may save yourself you hundreds or even tens of thousands of dollars.

Rule #3: Make constant profits

You must always choose a trading system that provides a nice and easy equity curve, even though in the long term the internet profit is slightly smaller. Most-professional merchants choose to get little profits every day rather than large profits every now and then. If you trade for a living, you need to pay your expenses out of your trading profits, and therefore you should regularly deposit profits into your trading account.

Making constant profits is the secret of successful merchants!

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

Allow me to give you an example: If you search for a casino and bet everything you've on 'red', then you've a 49% chance of doubling your cash and a 5-15 chance of losing everything. Exactly the same applies to trading: You can make a lot of money if you're risking a lot, but risk of damage is extremely high. You should look for a healthy balance between risk and reward.

Let us say you define 'ruin' as losing 20% of the account, and you define 'achievement' as making 20% gains. Having a trading system with past performance results let you calculate the 'danger of damage' and 'potential for success.'

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

Theory #5: Locate a program that provides at-least five trades each week

The larger the trading fre-quency the smaller the likelihood of having a losing month. Then 1 loser is enough to have a losing month, should you have a trading system that's a winning percentage of 700-watt, but only provides 1 deal per month. In this example, you could have many losing months in-a row before you finally start making profits. Meanwhile, how can you purchase your charges?

Then you definitely have-on average 2-0 trades per month, if your trading system produces five trades per week. Having a winning percentage of 70-ss - your chances of a winning month are extremely large.

That is the purpose of all traders: Having as many successful months as you can!

Principle #6: Start little - develop major

Your trading system should enable you to start small and grow large. A good trading system allows you to start with one or two agreements, and then raise your place as your trading account increases. This really is in contrast to many 'martingale' trading systems that want increasing place dimensions if you are in-a losing streak.

You probably heard about this strategy: Double your contracts everytime you drop, and one winner will win back most of the money you formerly lost. It's maybe not unusual to own 4-5 losing trades in-a row, and this would already require to trade 16 contracts after only 4 deficits! Dealing the e-mini S&P you would then need a merchant account size of at least $63,200, simply to meet the margin requirement. That's why martingale programs don't work.

Principle #7: Automate your trading

Thoughts and human errors are the most common mistakes that traders make. By all means you have in order to avoid these mistakes. Specially throughout fast areas, it's critical that you establish the entry and exit points fast and accurately; otherwise, you might miss a business or find yourself in a losing situation. Browse here at the link small blue arrow to compare the reason for this activity.

Therefore you must automate your trading and choose a trading program that both already is or can be automated. Automating your trading causes it to be without any human feeling. The buy and sell functions are typical automated, hands-free, with no manual treatments and you can be sure you make gains when you must according to your plan.

Concept #8: Have a high-percentage of winning trades

Your trading strategy should produce over 507 winners. There is little doubt that dealing systems with smaller earning percentages can be rewarding, too, but the mental pres-sure is great. Using 7 losers out of 10 investments and not doubting the system requires great discipline, and many professionals can't stand the pres-sure. Following the sixth loser they begin 'improving' the device or stop trading it fully.

Specifically for beginners it's a big help if you have a top winning percentage of more than 65% to acquire confidence in the body and your trading.

Principle #9: Look for a program that's examined on at the very least 200 trades

The more investments you employ in your back-testing (without curve-fitting), the higher the probabilities that your trading system can flourish in the long run. Consider the following table:

Number of Trades 5-0 100 200 300 500 Margin of Error fortnight 10-7 66-42

The more deals you've in your back-testing, the smaller the margin of error, and the higher the possibility of producing profits in the future.

Concept #10: Chose a appropriate back-testing time

I recently found the next ad: 'Since 1994 I have taught tens of thousands of traders worldwide a Simple and Reliable E-Mini trading system.'

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

The same applies to your back testing: If you developed an e-mini S&P trading strategy, then you must back test it limited to days gone by 2-4 years, because even though the contract has existed since 1997, there was almost nobody trading it (see chart below ):

Now you realize how-to separate the fraud from great working trading systems. By applying this checklist you will easily recognize trading programs that work and those that will never allow it to be.

Writers name

Markus Heitkoetter

Author's Info:

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