1. Understand that there are no set rules for investing. There are no guarantees and no perfect way to invest.

2. Make informed choices. Before investing in any way you should completely understand how your investment will work and all of the details of the transaction.

3. Make a simple plan to determine your goals and needs. This will help you to determine what investments to make and how much money to invest.

These three tips are great for general investing, but many people are looking to invest in the fast paced world of the stock market. The above tips are a good beginning, but the following tips will further help those interested in investing in stocks.

1. Look at the value of the stock instead of the price. Low cost stocks may be low for a reason. Look at the whole picture. See why the price is low and if there is a possibility it may rise.

2. Check the companies return on net worth. This is the profit after taxes divided by the net worth. It is important to see a trend of growing return on net worth.

3. Spread out your risk. You should not put all your money in high risk stocks. Try some lower risks and some higher risks. This is the best way to protect your money.

4. Understand the basics of stock prices. Prices move up or down depending on future projections.

These four tips can help a beginning investor start investing in the stock market.

No matter what type of investment you are looking into, knowledge will be the key to success. These short tip lists are just the beginning to understanding investing and how to maximize your return. Keep learning and trying.

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If youve ever thought that you did not have enough money to begin with investing, Ive got some good news for you. My name is Sam Chim and I am the owner of Invest-Tips.com, the investment information site. Even though Ive been investing for several years now, I still remember a time where I did not have a lot of money to start with.

Today, Im going to show you a method which I used to begin my investing career with a small amount of capital. That small amount is just $100 or approximately 70 for those in the UK.

To achieve the highest returns available for our $100 we need to look for investments. We need to find a way in which can make this $100 work for us so that we can grow it to a much larger amount. We also need to have a method of evaluating and assessing risk to our capital.

Ive found that the best way to start investing with small amounts of capital is not with real estate or stocks, it is with HYIPs (High Yield Investments Programs). These are online investments that anyone can participate and you are able to choose who to invest with and the amount you want to invest. Typically, these High Yield Investments offer between 20% – 40% interest per month. This means your $100 could turn into $140 in one month. Then after that it could grow to thousands if you kept re-investing.

However, one of the things that many gurus WILL NOT tell you is its not as easy as it seems. High Yield Investments require some level of research and money management. You will need to source some reliable investments (there are a lot of scams around) and also be able to manage your capital effectively to maximise your earnings and reduce risk (i.e. Are you going to diversify your investments or not?).

There is a lot to learn about this type of investment. Hopefully, after reading this, you will dig deeper and be able to start investing successfully with just $100. The opportunity to make money with HYIPs is wide open to anyone who wishes to take it. Are you going to rely on working for someone else for income or Are You Ready To Make Income On Your Own?

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Is it really possible to make a living as a day trader?

This question is asked over and over and over again by normal, ordinary people. The answer is simple: Yes, it is DEFINITELY possible! And, better yet, you yourself can do it! Sometimes people dont believe me when I say that they can become successful, full-time day traders, but its true. And Im going to prove it to you right now.

Before we get started, I need you to ask yourself one very important question: How much is a living? Many people want to be rich, but they fail to quantify what rich means to them. Are you rich if you have one million dollars? Maybe so, but if you told Donald Trump that he had one million dollars in his bank account, hed wonder what had happened to the rest of it! One million dollars to Donald Trump equals broke!

How to Make $150,000 Per Year
Since I dont want to get into a deep discussion about how much money is a decent living for you, lets just assume that you would be pretty happy if you were making $150,000 per year, and lets say that you are making this money with your trading. Does that sound reasonable?

Lets break it down: $150,000 per year would be $12,500 per month, or, if you prefer, $3,000 per week. This is assuming that you are taking two weeks of vacation per year.

So, would you like me to tell you how you can make that imaginary figure of $3,000 per week that $150,000 per year into a reality? Because I can. All it takes is smarts and strategies.

Start Small Set a Weekly Goal for Only ONE Contract
When day trading futures, options, or forex, you can use leverage and trade multiple contracts on a rather small account. If you are thinking about trading the futures market, then you can easily find a broker who will enable you to trade one contract of almost any futures instrument that is our there such as e-mini S&P, e-mini Russell, currency futures, interest rates, commodities, etc. on a $2,000 account.

I teach my students to set a weekly goal of $300 per contract. So, if you want to make $3,000 per week, then you need to trade ten contracts. Its possible that your broker might agree to let you trade ten contracts with $20,000 in your trading account, but if he wont or if you dont have $20,000 in your account at the moment dont worry. Just stick with me, and Ill show you how to get there.

How to Achieve Your Weekly Goal
The key element to trading success is having a sound trading strategy, and it must be one that works effectively in a variety of markets. You will dramatically increase your chances of success in trading if youre able to trade in multiple markets. Now, understand that when I say multiple markets, I do NOT mean different types of currencies! This is a common misconception. What Im talking about is TRUE diversification, which means watching the two U.S. Stock Index markets, one or two currency markets, commodities like the grains, interest rates, and/or a foreign index market, all at the same time. Here at Rockwell Trading Inc., we teach our students to watch six different markets every single day.

Another obvious key factor is profits; to achieve your weekly goal, youll ideally have a high average of wins per trade. It goes without saying that your average win should be at least 50% higher than your average loss, preferably even twice as high.

The strategies that I use and teach call for a profit target of $300 per contract and a stop loss of $200 per contract. Youll notice that the profit target is greater than the stop loss. Thats the beauty of it: all youll need is one win, and youll have achieved your weekly goal of making $300 per contract. ONE WIN!

Just as an FYI, this is why scalping is so much more difficult. Most scalpers try to make $10 – $20 per trade, so you would need 15 30 wins per week to achieve your weekly goal. Which do YOU think is easier? Making one profitable trade or trying to make 15-30 profitable trades?

Sounds Good, But What About Losses?
As everyone in trading knows, losses are a part of the business, and you cant avoid them. If thats something you have trouble accepting, then youre in the wrong industry. However, theres a huge difference between losing big on a regular basis and losing small in a controlled trading plan. Our trading strategies assume a certain amount of loss, and we prepare our students accordingly. You already know that you should keep your losses small; we simply teach you how to keep them smaller that your average wins.

Lets go back to the scenario I mentioned above: you have a trading strategy that produces $300 in profits for every win and costs you $200 for every loss. Now, if your weekly goal is $300, and if your first trade was a loss of $200, then you need to make two winning trades to achieve that weekly profit goal.

Let me take this a little farther and actually break it down for you: youve lost $200 on your one losing trade, and then you make $600 on your two wining trades ($300 each). Your net profit = $400. Goal achieved. Its as simple as that.

Of course, youre not always guaranteed a week with only one loss. Lets look at a week that started off with three losses. With three losses, you are now down $600 ($200 each). So, how many wins do you need to have before you achieve your weekly profit goal of $300? Three wins. Just three wins will result in $900 ($300 each). Subtract the $600 you lost on the losing trades from the $900 you won on the winning trades, and your resulting net profit is $300. Goal achieved. Again, simple as that.

Wait A Minute Youre Saying That I Will Achieve My Goals
With a Winning Percentage of Only 50%?
YES! Thats exactly what Im saying! Read the example above again: you lost $600 on three losing trades, made $900 on three winning trades, and came out with a net profit of $300. This means that you could pick a losing trade every other time and STILL achieve your weekly profit goals!

It gets even better: lets just assume for a minute that you do end up achieving an actual winning percentage of only 50%. Now, when you start trading again on Monday morning, what are your chances of having a winning trade? Since weve already established that you make $300 per winning trade, and since $300 is your weekly profit goal, your chance of achieving that goal after only the first trade on Monday is also an overwhelming 50%! You have a one in two chance of meeting your weekly profit goal in just one, single trade!

So if you DO achieve your weekly profit goal on the first trade Monday morning, what next? Stop trading for that week! Just enjoy life! It doesnt get better than that! Remember, you need to stick to your trading plan and your weekly goal. Do NOT enter into another trade once youve already achieved your weekly goal; the chance that your second trade may be a losing trade is too great, and you would be giving your money and profits back to the market. Overtrading and greediness are a traders downfall, so resist them and stick to your strategies.

How to Increase Your Winning Percentage
Ive just proven to you that you can achieve your weekly profit goal with a winning percentage of only 50%. But wouldnt it be wonderful if it was possible for you to boost your winning percentage to 60% instead, or even 65%?

Well, it IS possible, and heres how to do it:

Be picky. Seriously, when it comes to trading, being picky is actually a VERY good thing. Dont take the first trade you see just because it looks decent. Analyze your possible trade. Make sure that it fits ALL of your entry conditions and parameters.

As I said previously: you should be watching six different markets. Lets assume that you have a trading strategy which gives you one entry signal in the first two hours of trading. This would result in up to six entry signals per day, since you are watching six markets. Six entry signals per day add up to 30 entry signals per week.

Now, of course, there will be some days when youll only have 1-2 entry signals in the six markets; however, the chances are high especially if youre watching uncorrelated markets that youll get at least two entry signals per day, or ten entry signals per week.

Pay attention to your entry signals, and rely on them. You already know that youll meet your weekly goal with just one winning trade, so be patient. If there are no good trades on Monday, then simply wait until Tuesday. The same goes for the whole week. Dont push it! Wait until the market is ready to be traded. It WILL happen.

Waiting for YOUR trades on YOUR terms WILL increase your winning percentage. By skipping the trades with so-so entry signals, by taking only the best that the market has to offer, youll be on the right path to solid profits and success. Thats how it works.

Full Circle How to Make $150,000 Per Year
A quick recap: the first step towards financial success is to define your weekly profit target. Next, you need to find a reliable, straightforward trading strategy that will help you achieve your profit goal. When you enter into a trade and your trade hits either your profit target OR your stop loss, exit that trade immediately. Stick to your trading plans and strategies until you achieve your weekly profit goal, and then give yourself a rest until next week.

If youll think back to the case I gave at the beginning, in order to make $150,000 per year assuming a 50-week year and two weeks of vacation youd need to make $3,000 per week. At a $300 profit per trade, this means that you would need to trade ten contracts. Of course, this illustration can be applied to various amounts. If you wanted to make $225,000 per year with a weekly profit target of $300 per contract, for example, then you would have to trade 15 contracts, and so on, and so on.

If you dont have a trading account that lets you trade the amount of contracts that Im talking about yet, then now is the perfect time to start building it. Remember, be patient with your trading, be smart, slow, and steady. Trading success doesnt happen overnight, but with the right strategies and structure, you can achieve profitable results in a much shorter time period than you may have thought possible.

Plan your trades and trade your plan. THATS how successful traders make money.

I rest my case. J

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How do you feel when you see the trade moving against you?
Do you feel the urge of moving your stop loss?

How do you feel when the trade makes a profit?
Do you want to get out?
Do you want to stay in a little bit longer?

Do you have the discipline to trade your system according to your rules?
Trading a system on a paper trading account will help you:
Watching yourself and your feelings.
Helping you dealing with your feelings.
Developing the discipline you need to become a successful trader.
And of course: testing your trading system under “realistic” market conditions
A neat trick to increase your learning curve
The best way to trade your system is to fully automate it!
By automating a system you’ll immediately gain these four advantages:

Advantage #1: Discipline
The easiest way to follow a trading plan is to automate it. Almost every trading system can be automated, and you could let the computer trade for you. You won’t have to worry about your discipline any longer, as the computer mechanically trades every setup for you.
Advantage #2: Controlling your emotions
Automating a system removes emotions from trading. If you don’t automate your strategy try to make decisions when the market is moving, you are liable to become emotionally attached to positions. You may experience panic and indecision when the market does not move in your favor, as you do not have a prepared response. That’s when most traders lose their money. If you automate your system the computer will trade for you no matter what the market does.
Advantage #3: Controlling your losses
You probably have heard the saying Let your profits run. Unfortunately most traders let their losses run. Automating a trading system will get you out of a position when the predefined stop is hit. Unless you override the system to give the trade a little bit more room the computer will stop the loss and therefore limit your losses.
Advantage #4: Commitment
You won’t believe how many traders show a lack of commitment and therefore lose money. Lack of commitment means that they stop trading after the first loss, and don’t give their system a chance to make back the money they lost. Trading is not a one-way street, and losses are part of our business. If you can’t accept the fact that there will be losses, you shouldn’t trade. Fortunately the automation of a trading system can help you to overcome this problem; an automated trading system continues trading according to the rules, and therefore adds much more consistency to your trading.

The next step
If you read until here, then you learned a lot. By know you know
How to define your financial and trading goals.
How to select the right market for your trading goals.
What timeframe you should trade in.
The difference between trading styles and how to find the right one for you.
How to create a basic trading plan.
How to make sure that your trading plan will work in reality
How to start trading your system without risking a single penny
What it takes to become a successful trader
How to develop the habits of successful traders
A shortcut to become a successful trader
Now the ball is in your court. It’s up to you to take the first step.
If you want to get started within the next 24h, then you should definitely check out the trading systems Smart Start and EaglePro.
Both systems are fully automated, and they have a risk/reward ratio that’s perfect for beginners. Each system comes with a free paper trading account that lets you test the system risk-free.
It’s your turn now.

Authors name
Markus Heitkoetter
Author’s Info:
Markus Heitkoetter is a 19 year veteran of the markets and the CEO of Rockwell Trading. For more free information and tips and trick how to make consistent profits with online trading, visit his website www.rockwelltrading.com.

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Learn About It

Investments of any kind require that you learn about what you are investing your money in. Any other way of investing is only foolish, unless you have some really good financial counselors. But generally, the more you know the better off you will be. This is especially true in real estate, because the investments are large and the losses can be high. You should want to read all you can about it before you make any moves. Not only should you learn about how to choose a property that people will want, you also need to know how to research the local market to know what a property should sell for.

Types Of Property

There are a number of ways that you can get started in real estate. Largely this will be determined by how much money you have to get started with. If you do not have much money, you may want to start with foreclosures, or pre-foreclosures. These properties will be the cheapest, and, because of their value as opposed to their cost to you, could bring some excellent returns. You can buy them at less than market value, fix them up a little, and turn around and sell them at market value – for a good-sized profit.

Other properties involve residential or commercial, large and small. Once again, you need to make sure you know what you are doing before you invest. Learn the secrets to investing that will make it worthwhile, and be able to recognize a bad deal when you see one.

For Sale Or Rent?

When you want to buy property is it so that you can turn around and sell it – or do you intend to rent it out? Residential renters have a great many needs and may disturb your sleep if they need to have something done right away. On the other hand, commercial renters have a tendency to take of small things for themselves just to be able to get back to their business. Renting property out is one way to ensure an income over a long period of time, but will require a percentage of outlay to keep the property up. Commercial property, if in a prime location, however, is always sure to remain in demand.

While the real estate market is hot, there is a possible downside that you need to be aware of. Money that is tied up in real estate, while able to keep its overall value, could be tied up in that property for some time – not all property sells quickly. So you need to be able to figure in things like taxes, interest and other things that will eat at your profits over a period of time.

The market is good and much money can be made in it. It is just waiting for the right investor.

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Know your forex trading market.
Educate yourself about the currencies that you trade. The more you know about the country whose currency youre trading in the forex market, the more accurately youll be able to predict which way the money will move.

Pick a forex trading system and stick with it.
Savvy forex traders will tell you that system is everything. Forex trading by system lets you automate your trades based on history, following the traditional peaks and valleys. Set up a system and live with it to make the most of your forex trading.

Practice makes perfect but its not the real world.
Practice forex trading accounts are great for learning how a particular trading account works but theyre not the real world. Many experienced traders recommend starting off with a mini forex account to minimize your losses while you get acclimated.

Keep your eye on the margin.
Margin trading is a great way to lose a lot of money quickly. Stay away from forex margin trading until youre sure you know what youre doing.

The only win that counts in forex trading is the bottom line.
In forex trading, the bottom line is how much money you made at the end of the day. Dont count won or lost trades only dollars and cents.

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E-gold investing is a all about a system that allows you to profit from the money that is being traded everyday on the internet. What you’re doing when you are trading e-gold (or e-currencies) is that you are providing the backup for internet money. Let me go back a bit. What exactly do I mean by “backup for internet money”?

There is a cashflow of all of the money that is being moved throughout the internet every day. However, this money has to have, for every dollar that is being backed up, a physical backup of that dollar must exist.

This is a very superficial explanation about how the dxgold system works, but to be honest, to profit from it, you don’t have to understand exactly how it works to profit from it. If I were to put the e-gold training courses into a metaphor I would say it’s very much like driving a car. You don’t need to know how it works in order to use it properly.

What you do need to know is the egold exchange process and every step of the way. This may sound complex, but once you get to know it, it becomes a daily routine that takes about five minutes just to check up on.

Investing in e-gold is something that I could describe as a great investing strategy, if you are investing in the long run.

It isn’t as fast as a rising stock in wall street, it isn’t something that will double your profits in a couple of days, but it is something you can expect to generate a good income from. And the important keyword in that past sentence would be to Expect, because this is a safe long term strategy that is guaranteed to make a profit for you.

This is why I personally think it is plain silly not to learn this currency trading system. You even know how much money you will make each day in advance.

For some it may be tough, but saving a couple of hundred dollars and investing in e-gold can be a very wise decision. As many people have experienced already, it can even turn into a “hands off” second income without the 8 to 5 job.

E-gold is all about discipline. Is about the discipline of having your money work for you and letting it grow, without getting an urge of a shopping spree and taking your money out of your account.

If you think you can wait for a few months and are interested in getting a second income, then the e-gold system could be a good fit for you.

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But there never seems to be anything left over and your savings dont grow.

A better plan would be to pay yourself first. Dont let the money get into your hands.
You might find that you actually begin to grow your savings much quicker this way.

If you work for an employer with a 401K plan, the first thing you should do is to fund it to the max. If you cant afford that, at least put enough in to get the full matching contribution form your employer.

This investment is made before taxes. Your investment is larger and with the employers contribution grows quickly.

Next have a brokerage or mutual fund company debit your banking account monthly. This money should first go into an IRA if you have five years or more to go to retirement, make it a Roth IRA.

Next have a few dollars more be debited to go into a no-load, low cost mutual fund. The younger you are, the more aggressive your choice of fund can be.

After that is done, then figure out how to pay your bills and living expenses. If money is tight, cut back on your living expenses and use the extra money to pay down your debt.

Start with the lowest balance first. Once that debt is paid, take the amount of money you were paying on that debt and add it to the payment on the next lowest balance debt. Continue doing this and you can be totally debt free within 5 to 7 years.

Another version of this method is paying the highest interest rate debt first. The principal is the same, you just see more progress with the first method, although it could be more costly based on how your debt is distributed.

(If you dont believe me, get the premier version of Microsoft Money or Quicken and use the Debt Reduction module. You will be shocked at how much money you will save and how fast you can eliminate debt this way.)

The idea is to scrimp at the expense of your current lifestyle, while leaving your savings to grow and you debt to shrink.

I know many of the people reading this will scream that this is an impossible plan.
But it is quite doable with a little will power and the ability to delay gratification for a while.

The problem is that if you dont do this, your future might turn out to be very bleak.

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The performance report of our e-mini S&P Trading System Coin Collector shows an average profit per trade of $36 over the past 733 trades:

In between March 14-21, 2005 the system was over performing and we realized $963 in profits with 17 trades. These yields to an average profit per trade of $57, way above the “expected” average profit of $36 (see below):

When daytrading system you have to keep in mind that you are working with averages:

If your back testing shows an average profit per trade of $36 then you can be almost sure that the system will not suddenly jump to $57 average profit per trade.
In trading we have good weeks and bad weeks. Losses are part of our business. After a slow week there might be an extraordinary week. After a winning streak we will realize a loss.

Looking at the performance of that week a correction was inevitable. And it happened: Tuesday, March 22nd, we realized a loss of $712.50.

Such a loss hurts. You quickly forget all the nice profits of the past week and focus on the loss. You may start questioning your system and think that it stopped working, and so you stop trading. You start looking around for the next system. You don’t give the system a chance to come back to “normal”. You see an extraordinary week like the week from March 14 – 21, 2005 and think that you will continue making profits like this forever.

When reality hits you, you stop believing. But take a look what happened after the loss.

Here’s the performance report of the 2 weeks combined: The “good” week and the “bad” week with the loss of $712.50:

Now take a look at the first graphic with the performance the system is supposed to make.

We are right on target!

The average profit is back to normal, and so are the winning percentage and the profit factor.

Within two weeks the daytrading system normalized itself. That’s exactly what you should expect from a robust trading system.
The next step is finding a market that’s suitable for you.
Selecting a market
You can trade stocks, forex and futures.
Depending on your account size “stocks” might not be an option for you, since you need at least $25,000 in your account to daytrade stocks.
Forex trading is very popular, but if you are new to trading I must warn you:
The Forex markets are extremely volatile, and you can easily make (or lose) thousands of dollars in a day. Many Forex brokers offer “free quotes and charts” and “no commissions”, but keep in mind that nothing is for free: You are paying a spread, i.e. you can NOT buy a currency and immediately sell it for the same amount. It’s like at the exchange booths that you know from your holidays: You exchange $100 into 80 Euro, but when you change the 80 Euro back into dollars, you only receive $96.
Same when trading Forex: You are paying at least 2 “pips”. This amounts approx. $20, depending on the currency pair you’re trading. Another disadvantage of Forex trading is that you are NOT trading at an exchange: There is no “Foreign Exchange”. You are trading against your broker: If you are selling, then your broker is buying from you and vice versa. And that’s why your broker is giving you the quotes for free: He can basically give you *any* quote since there are no regulations. Scary, isn’t it?
Let’s take a look at futures trading:
Futures markets are regulated and you pay very low commissions. They are highly leveraged, since you can trade the whole index worth $66,500 with an account as small as $500. So you can achieve an enormous leverage of 130:1. There are many advantages, especially if you’re trading the index futures:
Index Futures are traded electronically and you can enter the orders through your computer, without ever calling a broker.
You are getting very low commissions. That’s important to keep your costs down and increase your bottom line.
You have a high leverage of up to 130:1.
You are trading some of the most liquid and popular markets in the world, hence you will experience little or no slippage.
Depending on your broker you might get quotes and charts for free.
My recommendation:
If you’re new to trading I strongly recommend starting with the futures markets. It’s way easier than you might think, and if you follow this guide then you’ll have no problem getting started in futures trading.

Selecting a timeframe
Let me be brief on selecting a timeframe, since you’ll figure this out very soon:
When you select a smaller timeframe (less than 60min) your average profit per trade is usually relatively low. On the other hand you get more trading opportunities. When trading on a larger timeframe your profit per trade will be bigger, but you will have fewer trading opportunities.
Smaller timeframes mean smaller profits, but usually smaller risk, too. When you are starting with a small trading account, then you might want to select a small timeframe to make sure that you are not overleveraging your account.
Most profitable trading systems use larger timeframes like daily and weekly. These systems work, too, but be prepared for less trading action and bigger draw downs.
My recommendation:
Therefore I strongly recommend that you stick to smaller timeframes like 60min and below. In addition you shouldn’t hold any positions overnight in your first couple of weeks of trading, so stick to daytrading.
Selecting a trading style
Basically there are 2 different trading styles:
Trend-following
When prices are moving up, you buy, and when prices are going down, you sell.
Trend-fading (or counter-trend-trading)
When prices are trading at an extreme (e.g. upper band of a channel), you sell, and you try to catch the small move while prices are moving back into normalcy. The same applies for selling.
Most indicators that you will find in your charting software belong to one of these two categories: You have either indicator for identifying trends (e.g. Moving Averages) or indicators that define overbought or oversold situations and therefore offer you a trade setup for a short term swing trade.
So dont become confused by all the indicators and trading approaches that are out there. Make sure you understand what the indicator is measuring and what category it belongs to.
Here are some examples of popular trading approaches:
Trend-following
oCrossover of Moving Averages
oTurtle Trading
oParabolics (e.g. SAR)
.
Trend-fading
oOverbought/Oversold Oscillators
oBollinger Bands and Channels
oTurtle-Soup Trading
My recommendation:
In my opinion trend-fading is actually one of the best trading styles for the beginning trader to get his or her feet wet. By contrast, trend trading offers greater profit potential if a trader is able to catch a major market trend of weeks or months, but few are the traders with sufficient discipline to hold a position for that period of time without getting distracted.
Detailing Your Trading Plan
By now you know how much money you want to make, how much you are willing to risk, what market you are going to trade in which timeframe, and what trading style you’ll use. In this section you will learn how to detail your plan by adding specific rules for entries and exits.
Entry Rules
Entering the market is easy. You have the following possibilities:
You can enter the market based on certain conditions,
e.g. prices move above the previous day high or
prices cross the 100-day moving average.
You can enter at a certain time,
e.g. you are ALWAYS entering the market at the open or
you are entering at noon.
A combination of both,
e.g. you are entering if prices cross above the 100-day moving average, but only between 8:30am and 12:00pm.
There are dozens of books, magazines and websites that offer you countless entry techniques. But as a famous trader once said: “The exit is more important than the entry”. So let’s take a look at exit rules.
Exit Rules
Lets keep it simple here, too: There are two different exit rules you want to apply:
Stop Loss Rules to protect your capital and
Profit Taking Exits to realize your profits
Both exit rules can be expressed in four ways:
A fixed dollar amount (e.g. $1,000)
A percentage of the current price (e.g. 1% of the entry price)
A percentage of the volatility (e.g. 50% of the average daily movement) or
A time stop (e.g. exit after 3 days)
I usually dont recommend using a fixed dollar amount, because markets are too different. For example, natural gas changes an average of a few thousand dollars per day per contract; however, Eurodollars change an average of a few hundred dollars a day per contract. You need to balance and normalize this difference when developing a trading system and testing it on different markets. Thats why you should always use percentages for stops and profit targets (e.g. 1% stop) or a volatility stop instead of a fixed dollar amount.
A time stop gets you out of a trade if it is not moving in any direction, therefore freeing your capital for other trades.
Other Elements
Entry and Exit Rules are the basic elements of your trading plan, and if you have a rather small account then that’s all you need to get started.
Later you want to add additional elements like
Money Management
How much money are you going to risk per trade?
When do you increase the contract size?

Diversification
How many contracts will you trade with ONE day trading strategy?
When will you add a second strategy? What kind of strategy?
In which markets will you diversify?

Payouts
When will you start withdrawing money from your trading account?
How much?
All these elements are becoming important when your account size grows, but in the beginning you can omit these elements to make it easier.
Authors name
Markus Heitkoetter
Author’s Info:
Markus Heitkoetter is a 19 year veteran of the markets and the CEO of Rockwell Trading. For more free information and tips and trick how to make consistent profits with online daytrading, visit his website www.rockwelltrading.com.

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