TRADING TIPS

VISA Risk to Reward and How Pros Think About It

January 15, 2020

Hubert Senters here. Let’s talk about one of the most important things that you need to be aware of and make sure that you have dialed in. Your risk to reward ratio. I always think risk first and reward last. So in this example let’s pretend that we’re going to get long some visa stocks. Symbol is the letter V. Very original. So what we’re going to do here is let’s say we just got long at the close of today which is basically $199.80. And we’re going to use the stop-loss of today’s low which is going to be $196.30. Here’s how I think about this. I figure out risk first. I know I’m risking $199.80 down to $196.30. So my initial risk is a unit. This unit is that large. Now, what I’m looking for is if I’m going to have a trade here I never want to risk something of my capital or cash flow. I’m not going to give at least a three to one four to one or five to one potential. You won’t always get it but that’s what you want to go for. And then all I do here is I’m just looking at this box will fit in here at least five times. What I be able to do is I want to get long. I want to risk a stop of $196 and my target is going to be $212. You can control that. It may go up sideways, stay here for several months and go up there and it may stop you out. But when I’m looking everything I’m always thinking risk first and reward second. Unfortunately a lot of people are going to trading and they think reward first. They never think about the risk. Heads up, a lot of the stuff that you’re going to do in any financial markets is almost all risks. You got to get your head right around that. TradeThirsty is having a special webinar tonight on how you can learn how to trade earnings better. Special guest speaker is going to be Dan Pasarelli. I’ve seen the webinar presentation. I know the strategies. I’ve talked to him several times about. And the title is how to potentially ‘’Dominate Earnings Trades with this Setup: How to Profit from Trading Earnings.’’ It’s Wednesday, January 15th at 7PM EST. You know how to REGISTER for the webinar. Good luck. Hope it helps. See you on the next video. Hubert.

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