You may be wondering, `Why would Mark Jenyns write about the toughest
Currency dealing trading technique around?`
There are a couple of reasons:
First, to notify you about the toughest Currency dealing trading
technique, because you really don`t want to end up using this program.
Second, because once you know the toughest possible Currency
dealing trading technique, the one that is designed to maximize your failures
over the lengthy run, then you can reverse it to art a technique which does the
exact opposite.
With what you learn from the toughest Currency dealing trading
technique, you will be able to create a program that will produce some
tremendous long-term profits. The toughest Currency dealing trading technique
I`m mentioning, which is simply the toughest Currency dealing trading technique
I have ever encountered, is known as calculating down. This terrible Currency
dealing trading technique is the procedure of purchasing more stocks that you
had previously acquired, as the price falls.
Traders often purchase stocks this way in an effort to decrease
their initial entry price.
Only bad investors regular down by purchasing stocks of a falling
assests to decrease their overall regular price per discuss. This Currency
dealing trading technique is hardly ever effective, and is often like putting
decent cash after bad. It also magnifies a trader`s reduction if the discuss
keeps dropping. Remember, just because a discuss is cheap now that does not
mean it`s not going to get any cheaper. However, let`s examine how this harmful
Currency dealing trading technique works. Say you bought one million stocks at
$40.
The beginner investor may not have a stop-loss in place, and the
stock price falls to $30 dollars. Here comes the absurdity of this Currency
dealing trading technique — to regular down the beginner investor might by
another million stocks at $30 to reduced the normal price per discuss that he`d
already purchased. So, his regular price per discuss would now be $35.
Unfortunately, the stock price may drop even further, and the
beginner investor will again buy more stocks to decrease the normal price per
discuss. They end up purchasing more and more into a discuss that`s losing
their cash.
Now, imagine this Currency dealing trading technique being applied
to a collection of resources. In the end, all the capital will instantly be
designated to the worse doing resources in the collection while the best doing
resources are sold off. The result is, at best, a unfortunate underperformance
in comparison to the market.
If a investor uses an calculating down program and uses edges, their
failures will be amplified even further. The biggest problem with this Currency
dealing trading technique is that a trader`s profits are cut short, and the
nonwinners are left to run. My guidance is — never regular down. The procedure
of purchasing a discuss, watching it drop, and then putting more cash at it in
the hopes that you`ll either get back to break even or make a bigger
eliminating is one of the most misdirected pieces of guidance on Wall Street.
Never be faced with a situation where you`ll ask yourself, Should I risk even
more than I initially intended in a desperate attempt to reduced my price and
save my butt?`
Instead, design a simple, robust program with decent management
rules. I can practically guarantee the results will be better than calculating
down.
