Every stock or ETF trade requires a pre-determined exit strategy to manage risk.

“So, you have to have an exit for every buy that you put on whether you're you're following us what we do at swing trader or you're just doing your own swing trades or position trades. Every trade you put on ETF or stock, make sure you know that what that exit is.”

Investors should manage risk by sizing their positions based on risk rather than chasing potential rewards.

“I would say in risk management the number one mistake I make you know I see people make beyond education is position size where they position size to reward rather than position size to risk and not knowing.”

Kevin Paffrath advocates for avoiding margin debt because it risks forced liquidation of assets at bottom prices during market volatility.

“and and I I really believe that any kind of short-term thing would just be short-term but when you've got margin man these banks they got you you know they got you in such a position where they can really uh you know sell everything you got to pay off that debt and sell you at bottom”

Traders must use strict stop-losses to prevent emotional decisions from leading to significant financial losses.

“So there's a very famous saying right the average investors book profits the great investors books losses. Okay. All right. So it is very important that you cut your losses at a very small length so that you don't have to go too far in a hope that the company will do too well”

Effective risk management, including the use of strict stop losses, is more important than absolute returns for long-term survival in the markets.

“I want to generate 25% with a drawdown of less than 5% ok so that is what we have been doing that is the entire m of my personal trading”

Individuals should take smart, calculated risks rather than unchosen risks in daily life to ensure they die happy.

“So, you might as well take smart, calculated risks and do all the things that you want to do and at least die happy when you go.”

People can improve their ability to capture luck by engaging in calculated risks and stepping outside of their comfort zones.

“Luck requires taking a chance, a calculated risk. It begins the moment you decide to act in the face of uncertainty.”

Embracing risk and failure is essential because it helps individuals step outside their comfort zone and better understand their true potential.

“Embrace these things because I think it opens up your this little box that we live in and it opens up your ability to get to know yourself and your true potential through taking risks and through failing”

Individuals can find ways to continue pursuing climbing while significantly reducing risk after becoming parents.

“There's a lot of experiences that just don't have the same value that they used to. And so I would say we're definitely kind of on the same page with in terms of the level of risk that we that we take when it comes to our professions.”