Successful trading involves more than just placing trades. The most important rule is to protect trading capital at all costs. While some capital must be risked for profit, it is crucial not to engage in gambling or high-risk betting.
Trading is based on statistics and probabilities. The goal of the software is to execute trades with the highest likelihood of a positive return, although this outcome can never be guaranteed. The future outcomes of trades are always uncertain. When trades turn against us, it is best to cut losses early and move forward, knowing that another opportunity will arise. Increasing risks by holding or doubling up can lead to significant losses, which is an inevitable reality.
Our approach is straightforward: each trade results in either a win or a loss. The maximum loss for any single trade is predetermined and never exceeds 0.5% of the account balance, often even less. We utilize dynamic trade management systems to adjust stops to break even or trail the current price, aiming to secure profits and minimize potential losses. Additionally, we set larger take-profit targets to ensure steady growth of the overall portfolio.
In essence, we cut losses early and keep losses small, enabling us to sustain our trading activities in the long run. Computers excel in this aspect compared to humans, who are often influenced by emotions and ego.
