Having a trade plan is extremely important to the success of your trading. Treat trading as a business, right? Have a trade plan, have a business plan on why you buy something and why you sell something. We encourage clients to have a set rulebook on why they're buying something and why they're selling something. Have things like, 'Am I trading in the direction of the trend? Am I buying stocks that are going up or am I shorting or avoiding stocks that are going down?' You might create different rules, where you only buy a stock if it's above a certain moving average or you don't buy something if it's below a certain moving average. You should have a set rule base, a set trade plan on when you buy and when you sell to keep you in control of the trade. Without a trade plan what will often happen is your little losses become big losses, you often get stuck in your losing positions, or you might trade too frequently trying to make back a big loss. It's extremely important to have a trade plan to keep you on track for your trading.
Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Covered calls provide downside protection only to the extent of the premium received and limit upside potential to the strike price plus premium received. With long options, investors may lose 100% of funds invested. Multiple-leg options strategies will involve multiple commissions. Please read the Options Disclosure Document titled Characteristics and Risks of Standardized Options .
Past performance is no guarantee of future results.
All expressions of opinion are subject to change without notice in reaction to shifting market conditions.
This discussion is provided for illustrative purposes only, and should not be considered an individualized recommendation or personalized investment advice. The strategies mentioned may not be suitable for everyone. Each investor needs to review a security transaction for his or her own particular situation.
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