- "Eat like a hen, shit like an elephant". Retail traders want win large and lose small. This is evident from the tight stop losses they keep. Professional traders in the other hand don't mind making small profits consistently with the risk of a large loss as long the probability of the large loss occurring is infinitesimally small.
- Following a process. Retail traders have no idea what they're doing or have to do. Pro traders have a process that they follow to the letter. The process is a backtested strategy.
I
have noticed a common trait among people who consistently lose money in
the markets. They think that at any given time, a particular stock is
either a buy or a sell. This is so far from the truth. In reality, if
you pick up a set of 100 stocks, maybe 3 or 4 of them will be tradeable
(worthwhile buying them or shorting them).
All analysts put three kinds of labels on stocks - Buy, sell or hold. It's time to introduce one more lable - do nothing.
All analysts put three kinds of labels on stocks - Buy, sell or hold. It's time to introduce one more lable - do nothing.
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