InvestorQ : How exactly do I shape my trading strategy like a hard boiled mercenary?
rhea Babu made post

How exactly do I shape my trading strategy like a hard boiled mercenary?

Answer
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vidhya Laxmi answered.
2 years ago


There is a famous saying among the mercenaries that if the damage to your gun is covered by warranty, then you did not inflict enough damage. That is true for a trader too. If you are making small losses, then it means you are not taking enough risks. It also means that you are unlikely to ever make big profits in the market. Like a mercenary, a trader should always live in anticipation of that big wager; and actually bet on it. You get the big opportunities only once in a while. As well make the best of it when it comes your way.

What we learn from a mercenary is that your returns should be in tandem with your risk. Effectively, if you are taking a huge risk, as well get paid for it. This is the basic rule for any market trader. If you have undertaken a 20% downside risk on a stock, no point in getting out after a 5% appreciation. That is a waste of the risk you have taken. A smart trader ensures that he adequately gets compensated for a huge risk. Otherwise why to assume the risk? But above all, like a mercenary, a trader never expects favours from the market. Don’t put a trade and just pray to god that things will go right. It rarely does. Actually, make it happen. That mercenary quality, perhaps, distinguishes a good trader from a great trader!