Penny stock trading is fraught with risks. It’s a cheap mode of getting into the stock market, but like many money saving measures, it’s not dependable. There are lots of risks involved if you are trading in penny stocks. We have tried to underline some of the prominent ones. 1. Rife with speculation The stock market is extremely speculative in nature, and penny stocks … [Read more...]
How The Correct Risk Reward Ratio Can Boost Your Profits
Ever wonder why a 1:3 Risk:Reward ratio is so prevalent as a rule of thumb? Ever since I’ve been reading about day trading, I’ve heard people say they ideally look for at least a 1:3 ratio, even they’ll settle for 1:2. In this article I’ll talk about how you can derive this value from the expectancy equation. Further, I’ll show how you can predict what kind of Risk:Reward ratio … [Read more...]