![]() However, risk management rules don't change. Market participants have to adapt constantly. Strategies that make money today may not make money tomorrow. Therefore, learn risk management first, then learn about making money from markets.Īnother good reason to learn risk management is it is much easier to learn than profit-making strategies. Risk management is far more important than profit-making strategies because it is meaningless to make profits today that you will lose tomorrow. However, if he had mastered and appreciated risk management, his losses will be mitigated. He is likely to give his gains back and more to the market when the bear market eventually comes. It is a dangerous thing for a novice to make huge gains from a bull market in his first year. Risk management is a topic that should be learnt before traders/traders think about making money from the markets. Van Tharp's books are must-reads for the topic of risk management. My condolences to Van Tharp and his family.
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