Your trading system must have an answers to these questions:


1) When to buy/sell 

  • Stick on to your strategy and never trade if anything went against your strategy.
  • Trade with the trend. Analyze the stock in different time frames to analyze the trend.
  • Stock may be showing a bull/bearish trend in the short term but the scenario may be different when we look into large frames.

2) What to buy/sell 

  • Invest or trade-in stocks only you have understood.

3) How much to buy/sell 

  • Take trade according to your position size and risk-reward ratio.

4) Maximum risk per position.

  • Never risk more than one-tenth of your capital on any one trade.

5) Maximum risk of the portfolio. 


 If you don't have an answer yet, do research, backtest and then start trading.