Behavioral response and decision making: How composed are you?
Level: Elementary
1/7
7 quick questions to gauge your masterclass!
Choose as many correct answers as you see fit
How to stop missing trades: which of these actions would you take:
Investigate before you invest
It talks about critically analyzing before entering a trade. This is good and important for traders.
Risking it all
It is not advisable. Risking it all is a bad approach and a reason why many traders end up depressed.
Stick to your plan
It is essential. After critical analysis, trader's must stick to their plan.
Ignoring opinions
It is good and also not good. While listening to opinions can be a great approach it can also be tricky and can lead to wrong counsel. So we advise you to do your findings and make good decisions.
What do you do when the trade is very close to your stop loss, but you feel the price will still make a turn for the better?
Adjust the stop loss to give the trade more room
It is not a great approach and could end up in a massive loss.
Check to see if the news or other happenings support your feeling.
This is bad and destroys the trader's confidence and decision making. As a good trader you must train your decision making abilities, not relying on the media.
Open another trading position with a similar target.
This option is not advisable. Opening another trade might just end up in another similar situation.
Look through your risk reward ratio and value rate before you decide what next
Analyzing your risk reward ratio and value rate helps you to know the next best step to take.
Which do you consider to be most important in a downturn?
A good exit strategy
"Good exit strategy" is very important in this situation. You have to take a break and restrategize.
Take advice from the media
This is a bad decision, the media will give you wrong financial advice and leave you confused in the future.
Seek government bailout
It is not advisable. Seeking a government bailout I'll only worsen matters with a huge interest rate to pay back.
Open a crowdfunding scheme
Crowdfunding is usually stressful and offers no final guarantee. Should any partner die or fall ill you might lose lots of money and end up facing legal issues.
As a day trader, you are having a rough day after entering five trades that have all been stopped. How do you handle the situation?
Redeem your loss with four new trades
This is in fact a bad decision and would lead you to big losses.
Reanalyze the market with more scrutiny before opening or closing trade
Traders must check thoroughly.
Open another trading position with a similar target.
This option is advisable. By opening another trade you stand the chances of doing better. This is because you now have experience.
Sell short the USD
Selling short without analyzing would lead you to losses.
What is your rule of thumb for rock-solid money management in your trade?
Never risk more than 10 percent of your trading capital
Traders must be cautious at all times and never risk their capital.
Have a daily/weekly trading limit regardless
Traders must put this into consideration, consistency is key.
Always set a stop loss
Traders must put this into consideration.
Savings up expenses down
Traders must put this into consideration and adopt it as a golden rule.
As a trader what are the questions you ask yourself that keeps you away from making trading mistakes
How much do I make by summer?
Your focus should never be solely on money.
Does my trade strategy fit in?
Traders must put this into consideration.
How much I'm risking on this trade, is it too much or ok?
Traders must put this into consideration.
When best do I exit or take profit?
Traders must put this into consideration.
Which is your go-to currency pair for more liquidity
GBP/USD
The GBP/USD pair is very popular in the international market and acceptable.
EUR/USD
The EUR/USD pair is very popular in the International market and acceptable.
SWISS FRANC/USD
The pair is not popular in recent times.
USD/JPY
The USD/JPY pair is very popular in the Asian market and acceptable.
0 out of 15 answers are correct You’re a growing beginner. Might need to brush a bit. Let us try to help you with a few tips on trading behavioral response as you are very close to becoming an experienced trader.
You are good to go. Astutely experienced and a few steps away from becoming a professional trader. Let us help you with a few tips that’ll prepare and equip you with metrics of trading decisions.
Congratulations!
You’re an expert and have mastered this course. Obviously, you have enough experience to respond to complexities and make good trading decisions. We’ll continuously try to help you with a few tips that’ll improve you even better.
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