USEFUL TIPS

There are around 16 FREE trading educational videos from authors like: Darrell Jobman, Brad Matheny, Gary Wagner, Linda Raschke, Adam Hewison, Joe DiNapoli and more, which traders, both beginners and experienced traders, should find them very useful.

Some of the featured videos are as follows:

1) Trading 101: Starting Your Trading Program
By Sunny Harris
In this video, author and professional trader Sunny Harris boils trading system design and analysis down to its most essential rules. In just a little more than an hour, you will discover the elements that are necessary to create a winning system, and you'll find out how you can apply each of these elements to your own trading. In addition, you will learn the 6 trading rules that will give you an edge, the 6 money management rules that will improve any system and the 6 essential steps to test your trading methodology.

2) Advanced Trading Applications of Candlestick Charting (73:53)
By Brad Matheny/Gary Wagner
In this video workshop, you will discover the crucial chart patterns that candlesticks reveal, how to interpret them and how to use them to pinpoint market turns. You'll also learn how to use candlesticks in combination with familiar technical indicators like Stochastics, %R, Relative Strength Index and Moving Averages to create a dynamic, synergistic and extremely successful trading system.

3) Spotting breakouts that lead to trend reversals (50:47)
By Darrell Jobman
Putting indicator clues together to identify setups for a new trend. As breakouts can be quite subjective, this video shows how to use other indicators and predict highs, lows and adopt multi-contract positions to provide profit.

In order to get the free instant access to the videos, just fill out the form here.

Hope this info can be useful to you.

Saturday, January 18, 2014

Money Management or Position Sizing – Part 1: WHAT IS IT?

As frequently mentioned earlier, Money Management is one of are the most important aspects of a trading system, along with positive expectancy and self management (trading psychology), which many professionals even believe that these aspects are the “holy grails” of trading.

While Money Management is extremely crucial, it is important to note that having a trading system that gives you a positive expectancy should be in the top priority when you are developing a trading plan. Because if your trading system has a negative expectancy, no matter how well your money management strategy is, you’ll still lose money in the long term.

This is like what Alexander Elder said in his book, Come Into My Trading Room:

A good trading system gives you an edge in the market.
To use a technical term, it provides a positive expectation over a long series of trials.
A good system ensures that winning is more likely than losing over a long series of trades.
If your system can do that, you need money management.
But if you have no positive expectation, no amount of money management will save you from losing.

What is Money Management?
In his book “Trade Your Way to Financial Freedom”, Dr. Van K. Tharp define “Money Management” as the part of your trading system that answer the question of “how much?” throughout the course of a trade.
How much essentially means how big a position you should have at any given time throughout the course of a trade.
Therefore, he refers to Money Management as “Position Sizing”.



The purpose of Position Sizing is to limit the size of what you are prepared to lose / risk in any single trade to a percentage of your total trading capital.

Some people may also call this as “Bet Size”.
Hence, Money Management, Position Sizing, and Bet Size are basically referring to the same thing, which is to answer “how much” in your trading system, as discussed in this post: Trading System: What Is It and Is It Important?

To be continued to: OBJECTIVES of Money Management or Position Sizing.

To view the list of all the series on this topic, please refer to:
Money Management / Position Sizing

Other Learning Resources:
* FREE Trading Educational Videos from Trading Experts

Related Topics:
* Understanding Implied Volatility (IV)
* Understanding Option Greek
* Understanding Option’s Time Value
* Learning Candlestick Charts
* Options Trading Basic – Part 1
* Options Trading Basic – Part 2

4 comments:

Zero Brokerage said...

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chonghe said...

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OPTIONS TRADING BEGINNER said...

Hi Chonghe,
Thanks for putting my blog link in your blog.
I put yours in my blogroll too.
Hope the readers can learn from your blog too. :)

chonghe said...

Thanks for that!
Cheers.