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MonestHind

08/28/15 11:07 AM

#133535 RE: Hydrogeohydro #133530

Incremental profit taking at predetermined exits is a highly efficient way to mitigate the risks associated with active trading in penny stocks.

Hitting those predetermined profit exits not only allows a trader to secure profits throughout a given trend, but it effectively reduces their exposure as risk increase alongside price. As risk/price increases, position size decreases as a result of the predetermined profit exits.

It affords flexibility and eliminates the emotion factor that so often results in bagholding.