It is believed that one of the common mistakes made by novices is that they “spend too much time trying to discover great entry strategies and not enough time on money and risk management”. Below mentioned steps precisely guides how to effectively manage your trade or trading psychology.
1. Stop-loss points
2. Reducing the position
3. Selecting low risk positions
4. Limiting the initial position size
6. Short selling
7. Hedged strategies
Always remember that “you must be willing to accept a certain level of risk, or else you will never pull the trigger”.