Trading concept are those patterns of market behavior that provide the basis for a trading system. It is on the basis of trading ideas that investors build their trading systems. Without an edge, the investor will always be at a disadvantage. What investors are always looking for is some kind of advantage, i.e. a favorable condition that will allow us to make money.
Investors are looking for low-risk trading opportunities where the risk is tightly controlled and the potential profits are substantial. This is because if we suffer a loss, we will only lose a little money, while if we choose the right type of stock, we have the opportunity to make a lot of money. Profits can be made by scaling up investments or increasing the frequency of trading, but only if we have a high possibility of successful trading.
So, what are the "simple rules" of the trading concept?
（1）Stop loss amount
An investor should never lose more than a certain number or affordable amount on a single trade.The mechanism at the time of trading (when a single loss does not exceed a small or tolerable amount) is called "stop loss". If the market price moves in the opposite direction of the number of shares you purchased, you should sell the number of shares stored at a predetermined price point, which is the "stop loss level". However, most traders think about using leverage. There is no doubt that the leveraged approach has major drawbacks.
（2）Profit extension
Most investors don't fail because they suffer too many losses, they fail because they don't take advantage of favorable times to make more money. Most traders never give themselves the opportunity to make a lot of money because they always cash in their profits too early."Profit extension" means that you set a price level in advance that will generate a certain amount of profit, and then cash out when the market price reaches that level.
（3）Reasonable selection of trading opportunities
The expansion of profits can only play a supplementary role, if only the best opportunities to trade, then the profits earned will be a lot, get more profit and reduce part of the loss at the same time.In most of the stock trading market, there are many investment opportunities that will allow investors to earn a lot of profit, but due to the lack of investment experience or some other reasons investors do not invest in time, thus missing this opportunity, so it is a very important thing to choose the right trading opportunity reasonably, cause it will bring investors huge profits.
There are many trading ideas in the stock market, but the most important thing is to look at the investor's trading ability and judgment method, moreover, investors need to learn the relevant investment knowledge systematically, so as to ensure that investors can grasp the profit opportunities and thus gain profits in the stock market.
