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"Trading is your path to financial freedom"
Van Tharp writes about risk management and mindset 😏
This is one of the most practical trading books, published in 2000. It emphasizes behavior, systems, and capital management rather than charts.
Key ideas:
⏺ The condition for testing and calculation: there is no system without numbers.
– Predefine entry, exit, and stop-loss points.
– Assess expected profit based on probabilities.
– Statistics are your filter, not opinion.
⏺ Position sizing formula:
– Maximum risk per trade is 1-2% of capital.
– Adjust position size according to the asset's volatility (for example, via ATR).
⏺ Define your style:
The book describes different types of traders: impulsive, systematic, intuitive, and others.
Choose a strategy that suits your personality – otherwise, the system or you will break down 😐
⏺ Working on fear, greed, and self-harm is mandatory:
Practice: keeping an emotions diary and visualizing potential losses.
📌 The market pays you not for being right, but for being systematic.
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