[Forwarded from Black Wolf Traders]
The main reasons for failure and loss of profit in the futures market in simple words
1. Capital management:
Assuming, for example, you have a thousand dollars in futures (I have nothing to do with spot), you open a position with $900, you have to fail and your total thousand dollars becomes zero, then you go to borrow, take a loan and fail again because you did not follow the principles and You went ahead stupidly, you will lose your cool
You have to follow the principles, if you don’t, you will surely fail, now what are the principles?
You have a thousand dollars in futures, you have to open a position of 7-10% of your capital (7% is logical) and 7% of a thousand dollars becomes 70 dollars, and leverage 3 and 5, finally leverage 7
Some say between 20, 30 and 50
Do you want to gamble? Go to the casino
Do you want to lose your cool? Go help two people so that you will end up well with their prayers
So, until now, you should follow the capital management and open a futures position with 7% margin
Now you have followed the capital management and entered the position, what is the second principle?
2. Risk to reward:
You opened a position of 70 dollars, you have to leave 7 to 10% loss for what? For a profit of 20 to 30%. Otherwise, you opened a position and left 10% loss for 10% profit, this is useless and you will lose again.
3. The third thing that you and the majority of ninety percent hate is (greed).
Sir, the position that TP eats, you should increase your loss limit and save profit, otherwise the responsibility of the signal is really with you, my dear friend, this has different models, some exit 60 20 20, some exit 50 25 25 and on the first target, 60% of the capital They take the exit stop higher than the entry point, when TP2 hits 20% of the capital, they take the exit stop higher than TP1. If the market falls, not only will they not suffer losses, they will also have saved profits, otherwise it is stupidity, pure mistake and deadly
On our side, we gave a futures signal, TP4 has been lost, it has given a percentage of profit, then the market fell and came down and put a stop. Don’t be tired, good morning
Sir, futures mean to profit for a moment, come out, don’t be greedy
4. Exit strategy
It means that you have a plan to exit, for example, 50 25 25. Either someone comes with a strategy of only one target and exits, or someone with a target of ten exits. It is your responsibility, dear friend.
If you make a profit in futures, you have to set a stop and set a stop above each TP
These words are the result of several years of experience, we lost a lot until we learned that by following it, you will never be harmed.
P.N.: The thousand dollars that we said was an example. Even if your futures capital is one hundred dollars, you should open a position with seven percent of it, which is seven dollars.
Send this text to anyone you know who likes it. Write it somewhere and whenever you want to open a position, tell me to read it a thousand times so that you can move forward exactly according to these principles. If you don’t move forward according to these principles, you will lose badly.
This post is written by nakok1