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Successful traders are those with successful trading habits. Luck can only carry one so far. One of the key successful habits is to form a trading plan. As Benjamin Franklin rightly said, if you fail to plan, you are planning to fail.
Here’s how to form a trading plan and execute it successfully.
1) Financial Analysis
Identify potential stocks $Apple (AAPL.US)$ $Meta Platforms (FB.US)$ $Microsoft (MSFT.US)$ $Alphabet-C (GOOG.US)$ $Alphabet-A (GOOGL.US)$ $Netflix (NFLX.US)$ $NVIDIA (NVDA.US)$ $Tesla (TSLA.US)$ $Rivian Automotive (RIVN.US)$ $Pfizer (PFE.US)$ $Moderna (MRNA.US)$ $BioNTech (BNTX.US)$ $Novavax (NVAX.US)$ $Medtecs Intl (546.SG)$ $Altimeter Growth Corp (AGC.US)$ by analysing the company’s financial statements and dividend track record. This is where financial ratios like gross profit margin, net profit margin, return on equity, current ratio, debt to cash flow ratio, net gearing ratio and dividend yield come in handy. Also pay attention to the current news that can impact the company.
2) Technical Analysis and 2% Rule
Study the charts. Use technical indicators to spot the trend. Identify the entry price, the price target for taking profit and the price to stop loss using support and resistance. Determine the risk-to-reward ratio (RR) and the probability of success (also called the percentage of winning trades). The potential reward should be at least three times the potential risk. Don’t give in to the fear of missing out (FOMO). In the words of Warren Buffett, “the stock market is a device to transfer money from the impatient to the patient.” The risk of losing money can be minimised by applying the 2% rule (each trade should not be more than 2% of the capital set aside for investment).
3) Control emotions and follow the plan consistently
This is probably the part where most traders fail. It is as tempting to hold on to winning stocks as it is difficult to let go of losing sticks but giving in to emotional impulses defeats the purpose of having a plan in the first place. Stick to the plan.
4) Positive Reinforcement
We become what we repeatedly do. Foster good trading habits by rewarding ourselves whenever we follow the plan consistently. This has nothing to do with the amount of profit or loss made in the trade. For instance, exiting a trade before the loss deepens to painful levels is a trading behaviour that should be rewarded despite not making a profit.
5) Review and Refine
Evaluate the trading plan for its effectiveness and finetune it to suit one’s risk appetite, financial needs, investment period and new developments in the market. There is no best trading plan, only what is suitable.
With practice and perseverance, we can all become successful traders!
Disclaimer: The above is my personal opinion. It is not financial advice or a recommendation to invest. Please consult a financial advisor before making any investment decision.
Check out Long Term Investment - A Strategy For Growing Returns Without Sleepless Nights https://www.moomoo.com/community/feed/107495017873414?lang_code=2
Here’s how to form a trading plan and execute it successfully.
1) Financial Analysis
Identify potential stocks $Apple (AAPL.US)$ $Meta Platforms (FB.US)$ $Microsoft (MSFT.US)$ $Alphabet-C (GOOG.US)$ $Alphabet-A (GOOGL.US)$ $Netflix (NFLX.US)$ $NVIDIA (NVDA.US)$ $Tesla (TSLA.US)$ $Rivian Automotive (RIVN.US)$ $Pfizer (PFE.US)$ $Moderna (MRNA.US)$ $BioNTech (BNTX.US)$ $Novavax (NVAX.US)$ $Medtecs Intl (546.SG)$ $Altimeter Growth Corp (AGC.US)$ by analysing the company’s financial statements and dividend track record. This is where financial ratios like gross profit margin, net profit margin, return on equity, current ratio, debt to cash flow ratio, net gearing ratio and dividend yield come in handy. Also pay attention to the current news that can impact the company.
2) Technical Analysis and 2% Rule
Study the charts. Use technical indicators to spot the trend. Identify the entry price, the price target for taking profit and the price to stop loss using support and resistance. Determine the risk-to-reward ratio (RR) and the probability of success (also called the percentage of winning trades). The potential reward should be at least three times the potential risk. Don’t give in to the fear of missing out (FOMO). In the words of Warren Buffett, “the stock market is a device to transfer money from the impatient to the patient.” The risk of losing money can be minimised by applying the 2% rule (each trade should not be more than 2% of the capital set aside for investment).
3) Control emotions and follow the plan consistently
This is probably the part where most traders fail. It is as tempting to hold on to winning stocks as it is difficult to let go of losing sticks but giving in to emotional impulses defeats the purpose of having a plan in the first place. Stick to the plan.
4) Positive Reinforcement
We become what we repeatedly do. Foster good trading habits by rewarding ourselves whenever we follow the plan consistently. This has nothing to do with the amount of profit or loss made in the trade. For instance, exiting a trade before the loss deepens to painful levels is a trading behaviour that should be rewarded despite not making a profit.
5) Review and Refine
Evaluate the trading plan for its effectiveness and finetune it to suit one’s risk appetite, financial needs, investment period and new developments in the market. There is no best trading plan, only what is suitable.
With practice and perseverance, we can all become successful traders!
Disclaimer: The above is my personal opinion. It is not financial advice or a recommendation to invest. Please consult a financial advisor before making any investment decision.
Check out Long Term Investment - A Strategy For Growing Returns Without Sleepless Nights https://www.moomoo.com/community/feed/107495017873414?lang_code=2
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$Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$ why always FOMO? It's never too late to buy when market turns bull, it does not just happen overnight. Observe before u make a move people.
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$Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$ 今天不减仓,设好了移动止损,暴风雨想来就来吧
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$Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$ The weekly volume has continued to increase, reaching several times the historical volume, and the bottom may be approaching. Wait for a signal. If the weekly chart can cross above the MA5 and MA10, look for a signal at the daily level.![]()
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$NVIDIA (NVDA.US)$ $PHLX Semiconductor Index (.SOX.US)$ $Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$
Although Nvidia is expected to have its recent challenges laid bare in an upcoming earnings report on May 25th, the company is not finding it difficult to maintain its position as a market leader when it comes to GPU sales.
According to Newegg’s ranking of graphics card sales, the company’s GeForce models completely dominate the current top 10 best selling gr...
Although Nvidia is expected to have its recent challenges laid bare in an upcoming earnings report on May 25th, the company is not finding it difficult to maintain its position as a market leader when it comes to GPU sales.
According to Newegg’s ranking of graphics card sales, the company’s GeForce models completely dominate the current top 10 best selling gr...
![Growth Ahead of Metaverse Utility.](https://ussnsimg.moomoo.com/1652867874649-70040953-android-org.jpg/thumb)
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Former President Donald Trump responded to the news that $Tesla (TSLA.US)$ CEO Elon Musk's planned $Twitter (Delisted) (TWTR.US)$ buyout is temporarily on hold.
"There is no way Elon Musk is going to buy Twitter at such a ridiculous price, especially since realizing it is a company largely based on BOTS or Spam Accounts," Trump posted on his social media platform, Truth Social.
"Fake anyone?" Trump posted, Mashable reports. "...
"There is no way Elon Musk is going to buy Twitter at such a ridiculous price, especially since realizing it is a company largely based on BOTS or Spam Accounts," Trump posted on his social media platform, Truth Social.
"Fake anyone?" Trump posted, Mashable reports. "...
![Trump says Musk won't buy Twitter. 'No way,' he posts to rival social media platform](https://ussnsimg.moomoo.com/1186172803361300754.png/thumb)
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$Taiwan Semiconductor (TSM.US)$ $Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$ TSMC has reached The price list changes are expected to be implemented starting in 2023. The increase in TSMC's production costs will result in changes for other smaller companies such as UMC, SMIC and Globalfoundes.
Price increases mean higher production costs, often accompanied by salary increases.
Anthor, from gas to fo...
Price increases mean higher production costs, often accompanied by salary increases.
Anthor, from gas to fo...
![A pay raise is coming. TSMC announces another production price increase.](https://ussnsimg.moomoo.com/1652439680845-70042961-android-org.png/thumb)
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$Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL.US)$ Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the SOXL where have detected an approximate $180.3 million dollar inflow -- that's a 4.0% increase week over week in outstanding units.
ETFs trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like ...
ETFs trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like ...
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