how to ensure minimum losses in trading?
Managing losses in trading
Avoiding loss in intraday trading is a function of market psychology, knowledge, position sizing, and stop loss.
Rely on position sizing
You are willing to loose only a certain amount during the day. If that hits, you will not trade for the entire day.
i.e. Rs 500/ (Entry price - Stop loss ) for long trades.
Stop losses are life savers
Single price stop loss is well known. Other kinds include time stop loss ( exit after certain time if price does not move ) etc.
Mantra of booking small returns
One cannot have large target intraday due to the time factor. Recognizing this, the trade can be broken into several parts and targets set accordingly.
Trend is your friend, always
Trend is you friend. Hence, it is advisable to never trade against the market. The index stocks will most probably follow index movements.
Avoid revenge trading
Revenge trading is a strict no for intraday trades. This point is also related to overtrading. Avoid it at all costs.
Don't track news during market hours
One should be able to analyze the market on their own and have that much needed conviction. Following the news may be confusing.
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