Nicolas darvas trading secrets
He decided he wanted to be a self-reliant trader instead. After paying his dues with some tough losses, he refused to quit on his dream and was soon making millions as a trader. He started his own hedge fund and has since made billions. Jones is unequivocally recognized as one of the greatest traders ever. When people think of billionaire hedge fund managers, they tend to think of big egos and aggressive risks.
Jones, perhaps the most successful hedge fund manager there is, tells us the key to success is the exact opposite of that perception. He says having an ego is a recipe for disaster and that aggressive offense is the downfall of most traders. Instead, the number one goal should be to play great defense. To be successful, you have to take risks. The fact is, risks can be considerably limited for most opportunities with a few smart precautions. By asking these three simple questions, your mind will quickly find some practical ways to minimize your risks.
And if the downside risks are limited, the upside potential is even more intriguing. For traders, that means always setting a predetermined stop for exiting a trade if it goes against you. Instead, millionaires become millionaires by coming up with simple ways to minimize the risks and maximize the potential rewards. Yes, there will always be risks involved with anything worth doing. But those risks can be cut back considerably if you simply take a step back and think about ways you can play great defense first.
Failure is part of life and the path to becoming a millionaire will include many failures. They key is to ensure that you will never let one single failure be so great that it wipes you out and prevents you from continuing to move forward. The material provided by the DarvasTrader. Another important characteristic of ideal Darvas stocks is a high Return on Equity. Fund managers love to see a high ROE.
Some put a higher value on ROE than they do earnings and sales. And just like when it comes to earnings and sales, the higher the ROE is, the better outlook for the stock.
Is volume increasing on up days, particularly on the day when the stock breaks into new highs? Volume can tell you so much about a stock. Ideally, you want to see much higher-than-normal volume when a stock breaks into new highs and lower volume when the stock declines. Is the stock a member of an industry group that has been increasing in price more rapidly than most other groups? At any given time in the market, there are certain groups and sectors that are very hot. Make sure your stocks are members of these hot groups.
Is the stock breaking out of a sound base pattern? You want to buy stocks that are breaking out of old price ranges and into new, higher price ranges. You also want to sell stocks that are falling down into lower price ranges. If a stock meets all of the above criteria, it is potentially a huge winner. Remember, as Darvas said, the only reason to buy a stock is if this price of that stock is going up. He was only interested in stocks that could double, triple, or quadruple over the next six to 12 months.
If you concentrate your stock selections to these types of stocks, you too may soon join the growing list of Darvas Millionaires. Unfortunately, most traders lack the discipline to stick with these strict requirements. When you subscribe, you'll receive " Secrets of the Darvas Trading System " absolutely free! The material provided by the DarvasTraderPro. The information contained on the DarvasTraderPro. We are NOT an investment advisory service, a registered investment advisor, or a broker-dealer.
You are solely responsible for your own investment decisions. The testimonials, earnings examples, and "success stories" used on this website are exceptional results and do not apply to the average individual and are not intended to represent or guarantee that anyone will achieve the same or similar results. The success of each individual depends on his or her background, experience, dedication, desire and motivation.
As with any business endeavor or financial transaction, there is an inherent risk of loss of capital and there is no guarantee that you will earn any money.
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