{"id":12520,"date":"2016-10-18T08:08:34","date_gmt":"2016-10-18T15:08:34","guid":{"rendered":"http:\/\/www.tradingheroes.com\/?p=12520"},"modified":"2025-07-30T00:34:14","modified_gmt":"2025-07-30T07:34:14","slug":"entry-exit-trading","status":"publish","type":"post","link":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/","title":{"rendered":"Is the Entry or Exit More Important in Trading?"},"content":{"rendered":"

There are many opinions out there on if the entry or the exit is more important in trading. In reality, it's all important.<\/p>\n

You need to have a complete system that has a statistical advantage, before putting any significant money behind it. In addition, you have a winning mindset and be in peak physical\/mental condition.<\/p>\n

But if we are going to only talk about entries and exits, then I wholeheartedly believe that the entry is much more important than the exit.\u00a0<\/strong><\/p>\n

Here's why…<\/p>\n

\"Entry<\/p>\n

Why People Say Exits\u00a0Are More Important<\/h2>\n

Some say that monkeys throwing darts to pick stocks<\/a> will do better than the average fund manager. This illustrates the point that exits are much more important.<\/p>\n

\"Stock<\/p>\n

There are educators who do exercises like this<\/a> to show the importance of optimizing exits. While the educators are making a very important point, some developing traders might misinterpret this to mean that exits are more important than the entry.<\/p>\n

Finally, there are studies that show that a random<\/a> entries\u00a0can show profitable results. One example is in the book Trade Your Way to Financial Freedom<\/a>.<\/p>\n

In that book, an\u00a0experiment done by\u00a0Tom Bosso showed that using a “trading system” that involved flipping a coin (for short or long), was always profitable at the end of each test. This is an excellent illustration of how important the exit is in trading.<\/p>\n

But that is all theory. Let's take a look at why I believe that great entries will help a lot more than great exits, in real world trading.<\/p>\n

Why the Trade Entry is\u00a0More Important Than the Exit<\/h2>\n

The best place to start is at\u00a0the beginning. Nothing happens to your trading account until you open a trade.<\/p>\n

You will never lose money if you don't open a trade.<\/strong><\/p>\n

Yeah, duh.<\/p>\n

I am only saying this because I think that it can be too easy to\u00a0take this for granted.\u00a0Here are a few other key things to consider\u00a0about entering a trade.<\/p>\n

Entries are Psychological<\/h3>\n

The very act of deciding to open a\u00a0trade is extremely important. If you are not in the right frame of mind or you don't stick\u00a0to your plan, it is very likely that you will end up with a losing trade. \u00a0<\/strong><\/p>\n

This can be overlooked when we examine\u00a0the results\u00a0of purely mechanical backtests. So deciding to put your money on the line all starts with your psychological state at the time the trade<\/a> is entered.<\/p>\n

Of course, this is not the case if you have a purely mechanical trading system. But for traders who manually enter trades,\u00a0the psychological aspect cannot be ignored.<\/p>\n

<\/h3>\n

A Higher Probability of Profit<\/h3>\n

When you have a good entry, your probability of success goes up significantly. For example, here is a trade that I entered\u00a0on a limit order.<\/p>\n

The blue line is my entry point, right above the previous high. I set a 20 pips stop (red line) and set a 2R profit target (green line).<\/p>\n

\"Chart<\/p>\n

As you can see, this was a strong uptrend and there wasn't a lot of room to profit on this trade. However, I was able to squeeze 2R out of the trade, just by having a great entry.<\/p>\n

If I had waited for the Outside Bar<\/a> to form, it would have been too late. The trade would have been stopped out.<\/p>\n

The green arrow shows the initial entry.
\n\"Trade<\/p>\n

Better Entries Mean More Profits<\/h3>\n

Here are two Pin Bar<\/a> setups, which one has the higher profit potential? This one…<\/p>\n

\"Good<\/p>\n

…or this one?<\/p>\n

\"Bad<\/p>\n

Obviously, the first Pin Bar has more\u00a0potential because there is more room to the downside, whereas the second chart is already very close to a major support level.<\/p>\n

So if you decide to take a trade on the first chart, your chances of getting multiple R out of it is much greater. Again it all comes down you which trade you choose to enter.<\/p>\n

Consider Opportunity Cost<\/h3>\n

Finally, by having a solid entry, you are more likely to reach your profit target faster. Or your stop loss<\/a>. This leaves your mental and monetary capital available to look for another opportunity.<\/p>\n

However, if you have a sub-par entry and you have to wait days or weeks to see the result, you are not making the best use of your time. Sure, some killer\u00a0trades will take a little time to materialize.<\/p>\n

But having the best possible\u00a0entry will help you increase the number of trades that you can take, and therefore multiply\u00a0your edge.<\/p>\n

Beware of Over Optimizing<\/h2>\n

Of course, the danger of focusing too much on the entry can lead to over optimization and trying to set your stop too tight. So be sure that you aren't trying to set your stop too tight.<\/p>\n

This all comes down to backtesting and figuring out what works best for your trading<\/a> style.<\/p>\n

Conclusion<\/h2>\n

Your trade exit is still important and should be optimized. Your risk management is also very important.<\/p>\n

It's all important.<\/p>\n

However, if you can focus on only entering trades that\u00a0have the best potential, being focused and optimizing your technical entry, you will make it much, much easier to profit consistently.<\/p>\n

 <\/p>\n

\u00a0<\/p>\r\n

Disclaimer: Some links on this page are affiliate links. We do make a commission if you purchase through these links, but it does not cost you anything extra and we only promote products and services that we wholeheartedly believe in. TradingHeroes.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Some traders say that the exit is more important than the entry, in trading. Is that true? Well, that depends on your trading system. However, I believe that the entry is far more important than the exit. Here’s why…<\/p>\n","protected":false},"author":2022,"featured_media":12522,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[204239],"tags":[201657],"class_list":["post-12520","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-trading-education","tag-trading-for-beginners","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"yoast_head":"\nIs the Entry or Exit More Important in Trading? - Trading Heroes<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.tradingheroes.com\/entry-exit-trading\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is the Entry or Exit More Important in Trading? - Trading Heroes\" \/>\n<meta property=\"og:description\" content=\"Some traders say that the exit is more important than the entry, in trading. Is that true? Well, that depends on your trading system. However, I believe that the entry is far more important than the exit. Here's why...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.tradingheroes.com\/entry-exit-trading\/\" \/>\n<meta property=\"og:site_name\" content=\"Trading Heroes\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/tradingheroes\" \/>\n<meta property=\"article:published_time\" content=\"2016-10-18T15:08:34+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-07-30T07:34:14+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"644\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Hugh Kimura\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@tradingheroes\" \/>\n<meta name=\"twitter:site\" content=\"@tradingheroes\" \/>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Is the Entry or Exit More Important in Trading? - Trading Heroes","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/","og_locale":"en_US","og_type":"article","og_title":"Is the Entry or Exit More Important in Trading? - Trading Heroes","og_description":"Some traders say that the exit is more important than the entry, in trading. Is that true? Well, that depends on your trading system. However, I believe that the entry is far more important than the exit. Here's why...","og_url":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/","og_site_name":"Trading Heroes","article_publisher":"https:\/\/www.facebook.com\/tradingheroes","article_published_time":"2016-10-18T15:08:34+00:00","article_modified_time":"2025-07-30T07:34:14+00:00","og_image":[{"width":1200,"height":644,"url":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png","type":"image\/png"}],"author":"Hugh Kimura","twitter_card":"summary_large_image","twitter_creator":"@tradingheroes","twitter_site":"@tradingheroes","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#article","isPartOf":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/"},"author":{"name":"Hugh Kimura","@id":"https:\/\/www.tradingheroes.com\/#\/schema\/person\/7224f1a7b68144f87391c62a49d7890a"},"headline":"Is the Entry or Exit More Important in Trading?","datePublished":"2016-10-18T15:08:34+00:00","dateModified":"2025-07-30T07:34:14+00:00","mainEntityOfPage":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/"},"wordCount":884,"publisher":{"@id":"https:\/\/www.tradingheroes.com\/#organization"},"image":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#primaryimage"},"thumbnailUrl":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png","keywords":["Trading for Beginners"],"articleSection":["Trading Education"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/","url":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/","name":"Is the Entry or Exit More Important in Trading? - Trading Heroes","isPartOf":{"@id":"https:\/\/www.tradingheroes.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#primaryimage"},"image":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#primaryimage"},"thumbnailUrl":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png","datePublished":"2016-10-18T15:08:34+00:00","dateModified":"2025-07-30T07:34:14+00:00","breadcrumb":{"@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.tradingheroes.com\/entry-exit-trading\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#primaryimage","url":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png","contentUrl":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/entry.png","width":1200,"height":644,"caption":"Entry signal"},{"@type":"BreadcrumbList","@id":"https:\/\/www.tradingheroes.com\/entry-exit-trading\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.tradingheroes.com\/"},{"@type":"ListItem","position":2,"name":"Is the Entry or Exit More Important in Trading?"}]},{"@type":"WebSite","@id":"https:\/\/www.tradingheroes.com\/#website","url":"https:\/\/www.tradingheroes.com\/","name":"Trading Heroes","description":"Discover Your Grail Trading Strategy","publisher":{"@id":"https:\/\/www.tradingheroes.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.tradingheroes.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.tradingheroes.com\/#organization","name":"Trading Heroes","url":"https:\/\/www.tradingheroes.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.tradingheroes.com\/#\/schema\/logo\/image\/","url":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/login-logo.png","contentUrl":"https:\/\/www.tradingheroes.com\/wp-content\/uploads\/login-logo.png","width":300,"height":150,"caption":"Trading Heroes"},"image":{"@id":"https:\/\/www.tradingheroes.com\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/tradingheroes","https:\/\/x.com\/tradingheroes","https:\/\/www.instagram.com\/tradingheroes\/","https:\/\/www.linkedin.com\/company\/tradingheroes\/"]},{"@type":"Person","@id":"https:\/\/www.tradingheroes.com\/#\/schema\/person\/7224f1a7b68144f87391c62a49d7890a","name":"Hugh Kimura","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.tradingheroes.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/15cd48e3c506e09e7a3b4edf8b221373f1e4e1a9148bbce44c77ff5db1e86693?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/15cd48e3c506e09e7a3b4edf8b221373f1e4e1a9148bbce44c77ff5db1e86693?s=96&d=mm&r=g","caption":"Hugh Kimura"},"description":"Hi, I'm Hugh and I'm an independent trader. Before starting Trading Heroes in 2007, I used to work at the trading desk of a hedge fund, for one of the largest banks in the world and at an IBM Premier Business Partner. Learn more about me here and read more of my articles here.","sameAs":["https:\/\/www.tradingheroes.com\/"],"url":"https:\/\/www.tradingheroes.com\/author\/hughkimura\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/posts\/12520","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/users\/2022"}],"replies":[{"embeddable":true,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/comments?post=12520"}],"version-history":[{"count":2,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/posts\/12520\/revisions"}],"predecessor-version":[{"id":1025184,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/posts\/12520\/revisions\/1025184"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/media\/12522"}],"wp:attachment":[{"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/media?parent=12520"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/categories?post=12520"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.tradingheroes.com\/wp-json\/wp\/v2\/tags?post=12520"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}