Risk Management in Intraday Trading
Managing risks effectively is essential for preserving capital and achieving long-term profitability in intraday trading. Setting Stop-Loss Orders: Traders use stop-loss orders to automatically close positions at predetermined price levels, limiting potential losses during adverse market conditions.
Position Sizing: Determining the appropriate position size based on risk tolerance and account size helps traders manage exposure and diversify their portfolio effectively.
Avoiding Overtrading: Overtrading can lead to excessive transaction costs and emotional decision-making, compromising trading discipline. Traders should stick to their strategies and avoid chasing every market fluctuation.