Ok blogophytes – time to learn something. If I were to ask a room full of traders what is the main rule you pay lip service to, I say lip service because most dont do it. It would be –
Cut your losses and let your profits run
The interesting thing about this phrase is its longevity within trading – this is not a recent statement of intent. If you look hard enough you can find it in very old texts regarding trading. For example the excerpt below is from an eighteenth century text.
This excerpt is taken from The Great Metropolis which was published in 1838 and is available on google books Whilst it is an interesting history lesson it is also indicative of the internal battles that traders have been waging since trading began.