Monday, June 18, 2007

 

Trading Rules

Just wanted to summarize what I've learnt and what I want to adhere to when I make my next purchase -

1. Buy options that have at least 3 months expiration on them. One month expiration are a bit too volatile for me.
2. Don't fight the trend.
3. Respect stop loss. I'm thinking of keeping it around 20% for options.

Most of them may be 'common sense' rules and could be found in most books, but I guess you don't realize the importance of them until you've experienced them yourself. I'll keep on adding to these as time goes by.

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