The “4 M’s” in trading refer to four key components that traders should consider when making a trade:
- Method: What is your approach to analyzing and trading the market? What indicators and tools do you use to make decisions?
- Money Management: How do you manage risk and protect your capital? What is your plan for managing your position size and your overall exposure to the market?
- Mindset: What is your psychological approach to trading? How do you handle stress, emotions, and setbacks in the market?
- Market: What is your understanding of the market and the assets you are trading? What is the current market environment and what are the key factors driving price action?
By considering these four elements, traders can develop a more comprehensive and well-rounded approach to trading, which can help them make better decisions and improve their results over time.