Twenty-five years ago, Jack Schwager asked Paul Tudor Jones what were his trading rules to live by. This was his response:...MORE
Don’t ever average losers. Decrease your trading volume when you are trading poorly; increase your volume when you are trading well. Never trade in situation where you don’t have control. For example, I don’t risk significant amounts of money in front of key reports, since that is gambling, not trading..
If you have a losing position that is making you uncomfortable, the solution is very simple: Get out, because you can always get back in. There is nothing better than a fresh start.
Don’t be too concerned about where you got into a position. The only relevant question is whether you are bullish or bearish on the position that day. Always think of your entry as last night’s close. I can always tell a rookie trader because he will ask me, “Are you short or long?” Whether I am long or short should have no bearing on his market opinion. Next he will ask (assuming I have told him I am long), “Where are you long from?” Who cares where I am long from. That has no relevance to whether the market environment is bullish or bearish right now, or to the risk/reward balance of a long position at the moment....
Paul Tudor Jones Interview at Institutional Investor