Stock Market Money Management Skills

Let us begin: You should not be afraid to take losses. Investors were the most successful stock market is people who want to lose money.

Having a strategy and / or philosophy is a very good base on which to invest, but that does not mean anything if you can not find my money. As I have said million times: no money, you can not invest.

Most investors spend too much time to find the right or the center of a perfect strategy, and too little time for money management. The most important cuts in its investment losses, won 90% of the battle to protect their property, regardless of the strategy.

The most successful money managers to earn money only 50-55% of the time. This means that successful individual investors would be wrong about half the time. As it happens, you better be prepared to cut its losses and, if they are small. By cutting losses quickly and let your winners ride up the trend, ending the year with black ink.

Here are some techniques that will help you with managing money:

Set stop loss that you have (you know where to cut the damage before it occurs ¡° This helps to control emotions when the time comes). "7-10% stop loss insurance is the best. Tighten the stop loss range of extent of market opening and a strong bull market.

Establish smaller positions if your account has been losing streak recently (sorry I can assure you that the important information, such as a critical turning point, perhaps it is time to sell and get out).

If you think you are wrong, or if the market moves against you, you cut half of the position ¡° This is the best insurance on Wall Street. "

If you cut half of its position twice, you'll be left with only 25% of the initial position of ¡° the remainder of the stock is no longer a major problem in a very low risk. "

If you're selling out of pre-term trade based on a small correction, you can always create a situation again.

The initial position of the amount of money plays an important role in the management of ¡° did not take too many views on the size of your portfolio. Potential investors should not use the entire account on one trade no matter how small your account

Know where you want to generate significant revenues away. Could be signs of topping last climax, or turning over the height of the higher volume.

Lastly, in order to act, as you begin to analyze them.

This guide is your way of solid money management skills that will help you profit in Wall Street through the years. Remember that you are losing the equivalent to at least half-time. It is a difficult concept to accept for most novice investors, but it is a fact. If you do not cut losses, you're not going to invest in a long time, the end of the money and the desire to continue investing.