Reblog: Here’s How Much Money You Need To Make To Break Even On That Bad Trade
The original article appeared on the blog of Stocktwits and can be found here.
People say it all the time.
Controlling risk is one of the most important things anyone can do when investing or trading. How much money are you comfortable losing on a single investment? How much of your portfolio is concentrated in one or two equities? These questions are only a few examples of what some risk managers might ask. There are many more.
The table below helps magnify the importance of risk control. It shows how hard it is to recover from a losing position. If you lose 30% on one bad investment, how much do you now need to make to recover from that loss? Or what if it gets even worse and you lose 60%? The answer to that question is on this powerful share from Elliotwave_Trading. If you know any new investors or traders who are just getting started, you might want to send them this as a friendly reminder: