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Friday 17 June 2016

At a crossroads

In the middle of a profitable deal, you are ask yourself: "Do I take the profits now or leave the position to gain more profit?". Maybe there were cases when taking profits earlier was a better solution. But I'm sure there were also cases where you hit on the head that you closed the deal too early.
Why traders limit their profit prematurely? Here are two options.
The first is that simply because traders do not have a clear target for a profit. There is nothing wrong to define profit target, it helps you complete the position easier without wondering close it now or later.
The second is: traders are afraid to risk and so take less profit. Some traders would rather seize them a sense of security and take the profit earlier than risking part of unrealized profit for another win.


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