Don’t ever average losers. Decrease your trading volume when you are trading poorly; increase your volume when you are trading well. Never trade in situations where you don’t have control. For example, I don’t risk significant amounts of money in front of key reports, since that is gambling, not trading.
Interpretation
Focus on quality trades rather than quantity, especially in uncertain situations.
Paul Tudor Jones emphasizes the importance of maintaining control over one's trading decisions. He suggests that traders should reduce their activity during poor performance to avoid losses and only increase their trading volume when they are confident in their decisions. He also warns against treating trading like gambling, especially in high-stakes situations, highlighting the need for disciplined trading practices.
In practice
This quote can be shared in a financial seminar to emphasize responsible trading habits.
If I have positions going against me, I get right out; if they are going for me, I keep them Risk control is the most important thing in trading. If you have a losing position that is making you uncomfortable, the solution is very simple: Get out, because you can always get back in.
As I've told my three daughters, all of whom I've at one time encouraged to go into macro trading, any man or woman can do anything to which they set their heart and mind.
I'm always thinking about losing money as opposed to making money. Don't focus on making money, focus on protecting what you have
You can not have significance in this life if it is all about you. You get your significance, you find your joy in life through service and sacrifice - it's pure and simple.
That cotton trade was almost the deal breaker for me. It was at that point that I said, “Mr. Stupid, why risk everything on one trade? Why not make your life a pursuit of happiness rather than pain?
I believe the very best money is made at the market turns. Everyone says you get killed trying to pick tops and bottoms and you make all your money by playing the trend in the middle. Well for twelve years I have been missing the meat in the middle but I have made a lot of money at tops and bottoms.
Remember that the stock market is manic-depressive.
Assets put money in your pocket, whether you work or not, and liabilities take money from your pocket.
The thing I have discovered about working with personal finance is that the good news is that it is not rocket science. Personal finance is about 80 percent behavior. It is only about 20 percent head knowledge.
Not yet have I found any better method to prosper during the future financial chaos, which is likely to last many years, than to keep your net worth in shares of those corporations that have proven to have the widest profit margins and the most rapidly increasing profits. Earning power is likely to continue to be valuable, especially if diversified among many nations.
There will always be bull markets followed by bear markets followed by bull markets
A big part of financial freedom is having your heart and mind free from worry about the what-ifs of life.
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