When Trading Nadex or Anything Else, Learn How to Stop!

Contrary to what some believe, trading isn't gambling. However, as traders, it might be a good idea to learn from “The Gambler” a little advice. As Kenny Rogers sang in his song by the same name:
"If you're gonna play the game, boy
You gotta learn to play it right”

...You've got to know when to hold 'em
Know when to fold 'em
Know when to walk away
Know when to run.”

As you place trades day after day, there is one simple rule to follow: “Learn how to stop.” Like the song says, “Know when to walk away and know when to run”, you’ve got to know when to call it a day. If you keep playing at the table, you’re eventually going to lose some. Set your profit goal for the day and then walk away.

You can set realistic goals for your trading day and one that has proven to work well is the 5% goal. This is where you look at your account size and determine what 5% is. For example, if your account size is $1000, 5% would be $50. So, once you've made or lost that $50, you are done. You don’t keep trading.

If on your last trade, however, you are up more than 5%, you have a choice. You can stop and be up more than your goal, or you can use that extra as a bonus and trade with that. To clarify what that means, let’s say you were up 7% on your last trade. You can take that extra 2% and place another trade with that amount of money, but not with the entire 7%. Set aside the 5% and only trade the extra. If your account size was $5000, and you were up 7%, that would be $350. You would leave the 5%, which would $250, alone and use the extra $100 for another trade. Your other choice would be to just stop and keep the extra $100 for another trading day.

You don’t need to trade all day. You also can’t expect to grow your account in one day! Let your bigger profits come from increasing your contract sizes. Don’t be too quick to grow your account! Set the goal of 5% a day based on your opening balance at the beginning of the month. Stick with that and only adjust it once a month. It is possible to increase your account size exponentially if you follow this simple plan.

If you would like to learn more about disciplining yourself in order to be a better trader, go to www.apexinvesting.com. Apex Investing Institute offers free education, and free access to the Nadex Binary and Spread Scanner Analyzers. Member traders are invited to trade in the rooms, take advantage of trade signal services, have key indicators and access the Apex Forum. The forum content is updated daily and includes over 7000 members. In a supportive learning community of seasoned as well as up and coming traders, traders of all levels learn how to trade Nadex binaries and spreads in depth, as well as futures, Forex, stock and options, and gain an edge for successful trading overall.