How to avoid the Risk of Ruin in Trading

Traders Den

The strategy I use

As « Market Wizards » author Jack Schwager says,”There are a million ways to make money, irony it’s very hard to find just one.”

The most important thing to look for in trading is to find your edge and become a pro at your own strategy.

As far as I am concerned, I use a swing trading strategy lasting from a few days to about a fortnight.

I exploit like many other traders recurring price/volume sequences, pure reflect of the consistency of human nature.

The variables I use are only price and volumes. No indicators derived from prices or volumes for me. No moving averages, RSI, MACD, and other stochastics.

Be careful, I am not saying that this information is not useful to others, but I consider that a trading strategy robustness is inversely correlated with the number of indicators it uses.

My relatively short time horizon gives me the opportunity to have my capital “turn” many times in a single year or even a single month.

It try to capture price movements of 50, 100, 200% or more on micro-caps and nano-caps on a regular basis.

Cutting losses as quickly as possible invalidates the anticipated move is an absolute necessity.

“Cutting losses as quickly as possible when the trade invalidates the anticipated move is an absolute necessity.”

My strategy is based on clear entry and selling signals. I buy into strength (breakouts) ans sell into strength or weakness. It depends on the specific behavior of each stock I trade.

Even if my strategy is purely discretionary, I have a quantitative approach in backtesting, controlling my risk, adjusting my position size, create a rigorous daily routine, journaling my trades, etc.

Price/Volume patterns recognition

The market produces price sequences in an immutable way reflecting the upheavals of human nature which never changes.

The main idea of my strategy is therefore to take advantage of these “tracks” left by market operators, screening each day the more than 7,800 stocks that make up the american stock market.

My trading philosophy

My trading approach consists in following short trends by buying stocks that emerge from healthy bases up on daily price bars after in strong groups. No room for fundamentals which in my opinion induce a harmful bias to long-term performance.

Risk management is particularly important and is scrupulously respected. Stops are systematically placed before any position is taken.

I always place a stop for each of my trades and if I shift it, this is to reduce my risk never to increase it.

The goal is to follow the stock behavior without ever trying to anticipate what « should or could » happen by cutting losses short when the trade does not have the expected behavior and letting the gains run as long as possible over the time horizon considered.

Nothing magic then …

You can contact Florian Campuzan (Trading Coach) at

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