Ekdum sahi bola Manibhau..!
Secret of success in trading is based on following statistics. If a trader is failing in any of the below mentioned stats he should quit trading asap and invest his hard earned money somewhere else.
1. Risk management
{1-(W-L)} ^ U
% Risk of ruin =——————— < 1%
{1+ (W-L)}
U= No of units of money
W= % Win
L= % Losses
% Risk of ruin can be reduced greatly with good % win and Risk- reward ratio.
2. Mechanical System with positive expectancy,
Expectancy formula =
{Probability of winning X (Avg.win/ Avg. loss) - Probability of losing X (Avg.win/ Avg. loss)}
3. Sound psychology to follow the system even while in drawdowns.
