Trading Stocks: Does Your Risk Make Sense?

Does Your Risk Make Sense?

'Controlling' risk is a very important concept for anyone looking to trade the markets. With that being said, 'understanding' risk is a whole other topic and one that many traders fail to realize. The professional traders both control and understand risk, so let's figure out where you stand in this situation.

[sierramariehenry]

Wow, that was very easy to understand, and I could see how it could be easily misplaced, blindly, which is definitely illogical, and I was doing that exact thing, using it as a safety net, yet I was setting myself up for failure. spectacular video!

[MrQuasar]

Clay, you should make a video about making money even when you're 50%+ wrong on your trades. Nice job! Keep it up!

[MrChubbycheese]

Clay, do you have a video where you teach risk management?

[measdna]

Hello Clay, Thanks for posting.

I do have some questions which I hope you can clarify. 1) In your example, you placed at stoploss at $25, why is $25 a good place to put a SL? Why not $23 or $24 or even $25.20? for that matter, what aspects of a stock do you consider when placing a SL? 2) You keep mentioning throughout the entire video that a SL is a good thing to do but it is just one piece of the puzzle, you mention there are other things but never explicitly say what those other things are... can you give us examples of other things that can be done to manage risk besides a SL? 3) You elaborate on the illogical risk but not really mention much about logical risks... how can you tell when the risk you are taking is logical vs. illogical? Can you give us an example of a logical vs. an illogical risk?

Thank you.

[bradthompson]

I plan on joining CTU next month when my income taxes come in, but I do hope you go into more detail on those videos. I’m green, and I have a lot to learn, when you said about the positioning of the stop loss, “there are some of you sitting there thinking ‘what is wrong with that’”. Yea, that’s me, but you never explained it further. At the end of the video I’m sitting here looking at my iPad like the saints fans were looking at their TV’s at the end of last Sunday’s game. I hope there are no cliff hangers like that in the CTU videos. lol.

[otherz_world]

would keeping stop loss at a few dollars to $10 based on there's no guarantees. and market keeps fluctuating?