How can you be a successful day trader without losing money and making a profit every time?
I think people misunderstand what “success” means in day trading. It doesn’t mean you never lose on a trade, it means your wins outrun your losses, plain and simple. That’s it…
If I risk per trade: $5,000 (how much I will lose if I’m wrong)
and my average loss is: $5,000 (1x my risk)
and my average win is: $6,000 (1.2x my risk)
If I take 10 trades in a week, lets say I lose on 3 trades and win on 7 trades, so I lose $15k ($5k on 3 trades), then make $42,000 on 7 winning trades - $15,000 losing trades = $27,000 profit / week.
That’s how the math works…
Most of you….can’t handle your emotions… What most of you don’t understand is what happens if your first 3 trades are LOSING trades… you never step up for the next 7 trades and you stop on a losing streak…so close to greatness. That’s why managing expectations and emotions is so critical. It’s all about following a written plan.