Authors

activetrading My passion has always been financial market trading and investing since 1995. I pride myself on educating individuals and groups how to succeed in the financial market trading arena. My specialty of trading styles cover a wide spectrum of techniques including Scalping, Position Trading, Momentum / Trend Trading, Spread Trading, Swing Trading, Gap Fills, Range Trading, Technical Analysis and many others.

Expert Stock Market Trader Richard Rizzo finds his students struggling with the transition process of paper trading on a demo software platform to trading with real live money. This 3 part article with provide step by step advice on how to over come this challange. (Part 1 of 3)

Any seasoned expert will tell you the early stage of development is the most crucial part of your progression schedule needed for long-term success. Be informed that this is the stage where most novices fail to lift off the launching pad and end their trading career before it even begins. Avoiding this failure can be easily overcome by following the basic principles of preparing your daily profit goals and loss breakpoint. So, I ask that you pay close attention and try your best to carefully follow the steps provided in this segment.

Daily Profit Goals & Loss Breakpoints Overview:  In this segment, you will learn the best way to define and create your“Daily Profit Goal” and“Daily Loss Breakpoint” in efforts to manage your Monthly net profit and loss. Establishing a Daily Profit Goal will provide you with TWO major components of your daily routine. The first component is a daily profit target to aim for. The second component helps you retain your profit for the day and avoid giving it all back before the day’s session closes. All traders of every experience level must establish this daily routine in efforts to achieve long-term success in the market trading industry.

Reaching your “Daily Profit Goal” and “Daily Loss Breakpoint” defines the moment you STOP trading for the day. It must be measured in direct correspondence with your level of trading knowledge, experience, recent performance, financial status and risk tolerance. The information provided below is conclusive from researching and monitoring thousands of traders that received education and training from Cambridge Trader’s Institute since 1995.

Daily Loss Breakpoint Overview:  Your daily loss breakpoint should define the moment you “STOP TRADING” for the day as a result of losses. The main purpose of following this rule is to manage your risk and prevent the unfortunate possibility of losing the majority of your risk capital and not having enough left over to make it back. Another purpose of following this rule is to avoid “revenge trading”. This happens when a trader losses money beyond their breakpoint and tries to quickly make it back out of revenge. This often leads to recklessness and violating all the trading rules put forth in your trading model and self-discipline. In addition, revenge trading ultimately results in additional losses as most individuals trade the same stock they lost their money in without merit or chase every movement in multiple stocks that do not satisfy the trading model criteria. (click here for part 2).