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Thread: Is this a really secret of Stock Market?

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    Default Is this a really secret of Stock Market?

    Dear Fellow Traders,

    Everyone related to Stock Market is always focused on the goal of how much they can make buying/selling a stock, they forget to concern themselves with how much they risk loosing. Is it true that “The secret to great wealth in the stock market, is not big gains; its small losses”

    Is this a strategy of keeping losses small? If we will win only 1 out of 3 times with our losers loosing 5% and our winners gaining 25% we can make extremely large profits. That’s do the math assuming that there is only 1 out of 3 winners. So if we make 9 trades of USD10,000 each in one month it means we will loose money on 6 and make money only 3. the 6 losers will cost us USD3000 (6*5% loss on each of USD 10,000 Trades) and the 3 winners will net us USD7500 (3*25% gain on each of USD 10,000 Trades) for a profit of USD 4,500

    Regards
    Mark



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    This is common sense, it's called having a Stop Lose. It doesn't mean you will make money either!
    Why is this even posted?
    Last edited by ol' boy; 14-10-09 at 07:58 AM.

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    Thread closed and spammer banned
    Reality is an invention of my imagination.
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