Instead of making complicated mathematical operations, you have Traders-Paradise’s new strategizing app
Taking profit when trading is the happy end of trading, of course.
Do you know how to reach it?
Some may think it’s easy. Yes, sometimes it is if you were born under the lucky star to a made-up universe, but for the majority, it is a long and painful path.
First comes first.
For every trade, you need a plan. This means you will need an exit strategy. Entering a trade is the easiest part, the tricky part is when to close that trade, sometimes with a loss and sometimes with a profit. You can close your trade under different positions, you can use a stop-loss order, profit target, trailing stop-loss, etc.
But how you know where to set your orders?
Suppose you are trading and you bought a stock
at $100. Assume you place a stop-loss order at $98. What does it mean? It means
you are willing to risk $2 per trade. Let’s say, you set your target at $ 106
or $110, meaning up by +6% or +10% of the initial price of the stock.
What we’ve learned, after spending some time on this app, is that sometimes the smaller strategy, meaning +2.5% for a take profit and -1.5% stop-loss, might seem like a more solid trade than +30% and -15% (take profit and stop loss).
Taking a risk
It doesn’t matter if you have $1.000 or 1 million on your account, a rule of thumb is you shouldn’t risk more than 1%-2% of your deposited funds.
Now, let’s say you want to start trading and you choose a company for example – Tesla Inc. (Ticker symbol = TSLA) that costs $350 and you decide that’s a fair stock to trade and you buy a few of these stocks at that price. If the price rises you’re profiting, right? And if the stock is dropping you’re losing, right?
You’re only profitable or on the losing side when closing that position.
Closing a position means you have an exit strategy.
Your exit strategy can be by intuition or by a pre-strategic method like “Take-Profit / Stop Loss”.
How to plan a pre-strategic method?
One way is to guess where to place your stop-loss and take-profit orders. Well, you will never be sure that the chosen exit strategy is in fact good. Guessing requires a lot of experience, knowledge, education (and luck). But even if you have all of the above, you will never be sure that your exit strategy is the right one.
What if you set a take-profit to close to the current price? You could miss big gains. And what if you set your stop-loss too far? You can make some additional losses you could avoid.
The best choice is to use this app
First of all, it’s super easy interface is
suitable for both beginners and advanced. You can use it numerous times, there
are no limitations – this is extremely important when optimizing strategies
using trial and error, and that’s basically this app’s best feature: You don’t
have to spend your real funds on trial and error. It does it for you, for free,
and absolutely fast.
You can compare several exit strategies. For example, for a certain stock: your exit strategy is stop-loss at -1,75%, take-profit at 5%. In less than 10 seconds the app will show you how successful was that strategy last week, last 3 months and over the last year. Behind this fast displayed results lies a lot of math and statistics, big data analyzing and super-fast algorithms, many operations, numerous trading conditions, etc.
To tell in simple words, this app gives you the opportunity you never had before. For the first time, traders may test their exit strategy without consequences, without losing money but with as high as possible accuracy. The data is updated several times per day and received from a legal provider. All data is accurate and recent.
So, taking profit when trading becomes much easier and in-hand with this tool. Check it for yourself, it’s free.