As Paul Tudor Jones Says...

[Money Trust]

Where you want to be is always in control, never wishing, always trading, and always first and foremost protecting your ass. That’s why most people lose money as individual investors or traders because they’re not focusing on losing money. They need to focus on the money that they have at risk and how much capital is at risk in any single investment they have. If everyone spent 90 percent of their time on that, not 90 percent of the time on pie-in-the-sky ideas on how much money they’re going to make. Then they will be incredibly successful investors.

Wise words indeed, but what about focusing too much on what you could lose and focusing very little on the potential reward? How does one go about finding the balance that would allow them respect risk enough to not be reckless in their trading but at the same time, to not focus so much on what could be lost that it stops one from taking trades at all?

 

[Al_Bundy]

That's a great quote. In my view, you have to focus on what you could lose because that's the part that you can control. If for example you buy a stock for $10, indeed it might go to $40 or $50 and make you a lot of money, but you can't bet your whole account on that hope. First and foremost you protect what you have by putting in a stop loss.

 

[stock777]

its a problem. Im the king of limiting loss. Make Jones look like a drunken spendthrift.

but finding the balance is damn near impossible

 

[murray t turtle]

Wise words indeed, but what about focusing too much on what you could lose and focusing very little on the potential reward? How does one go about finding the balance that would allow them respect risk enough to not be reckless in their trading but at the same time, to not focus so much on what could be lost that it stops one from taking trades at all?

%%%%%%%%%%%%%%%%%%%%%%%%%%%
Good question,Money T
I like this Paul Tudor Jones quote, even though i dont agree mostly with his politics/redemption;

''I read an article on Richard Dennis + it made a big impression on me.....PT Jones told Jack Schwager.

In other words while i still enjoy ''digesting'' Rich Dennis -jack schwager '' trend info, for many years;
i also enjoy Remington Farms plan............................................................................................................[Cash grains, cash metals for example will never have the [Rich dennis]returns or risk of leveraged Chicago wheat]. Hope these wise word help

 

[Redneck]

How does one go about finding the balance that would allow them respect risk enough to not be reckless in their trading but at the same time, to not focus so much on what could be lost that it stops one from taking trades at all?

Trading…, every person is a one man / one woman team

We must lean to play offense & defense with equal competency

Takes time... concerted effort..., and baby steps



Play defense mode till the trading is working

Switch to offense mode to get the as much out what the mkt offers - as your current skill allows

Accepting every day is a work in progress toward improvement

RN

 

[marketsurfer]

There is only one thing you need know from PTJ, one thing only and that is spelled

VPIN

 

[Money Trust]

There is only one thing you need know from PTJ, one thing only and that is spelled

VPIN

Elaborate

 

[Money Trust]

Trading…, every person is a one man / one woman team

We must lean to play offense & defense with equal competency

Takes time... concerted effort..., and baby steps



Play defense mode till the trading is working

Switch to offense mode to get the as much out what the mkt offers - as your current skill allows

Accepting every day is a work in progress toward improvement

RN

Sounds like really simple but sound advice.

 

[Banjo]

Elaborate

http://insight.kellogg.northwestern.edu/article/the_trouble_with_vpin

 

[marketsurfer]

http://insight.kellogg.northwestern.edu/article/the_trouble_with_vpin

I have found it to be exceedingly accurate.