How to handle your capital to be a successful intraday trader?

For all traders, managing risk is essential to survival.

It is among the few elements of the market that a trader can influence.

It is among the few elements of the market that a trader can influence.

The most frequent mistake made by novice traders is to take excessively large positions without considering risk management.

Beginners may gamble between 50 and 100 percent of their capital on a single trade due to unrealistic expectations. It is gambling, not trading, to take big risks with large positions.

Gaining consistent profits and conserving capital over time are the foundations of successful trading. 

Excessive position sizes in trading frequently lead to enormous losses; this is the main cause of new traders going bankrupt fast.

Huge emotions are correlated with large positions:
The intensity of the emotion, be it fear or greed, increases with position.

Traders who are just starting to lose discipline and trade subjectively and emotionally are typically the ones who suffer from the large Profit and Loss swings that come with large positions.

Because of position size, it is more difficult for traders to accept a loss on the one hand and to allow profits to run on an excessively large position on the other.

Ultimately, because of large position sizes, traders do the exact opposite of what they ought to do to succeed: they extend their losses and cut off their profits. To be continued...