Trading Rules
These fundamental principles have guided Malibu Investment's trading philosophy since 1992. Master these rules to become a disciplined and successful trader.
Define Your Risk
Every trade must have a clearly defined maximum loss. Never enter a position without knowing exactly how much you're willing to lose.
Use Stop Losses
Protect your capital with disciplined stop losses. The market doesn't care about your opinion - respect your stops.
Position Sizing Matters
Never risk more than 2-3% of your total capital on a single trade. Proper position sizing is the difference between surviving and thriving.
Trade the Trend
The trend is your friend until it ends. Don't fight the market direction - align your trades with the prevailing trend.
Patience is a Virtue
Wait for high-probability setups. Not every day requires a trade. Be like a sniper, not a machine gun.
Manage Your Emotions
Fear and greed are the enemy. Stick to your trading plan and don't let emotions drive your decisions.
Keep a Trading Journal
Document every trade - entry, exit, reasoning, and emotions. Learn from both wins and losses to improve continuously.
Diversify Your Strategies
Don't put all eggs in one basket. Use a mix of strategies - options, stocks, spreads - to manage overall portfolio risk.
Know When to Exit
Having an exit strategy is as important as entry. Take profits when targets are hit and cut losses quickly.
Continuous Learning
Markets evolve, and so should you. Stay informed, adapt to changing conditions, and never stop learning.
Ready to Apply These Rules?
See how we implement these principles in real-time with our private Twitter feed. Get daily trade ideas that follow these exact rules.