7 sins of a trader you need to avoid

posted on

3 min

Here are some of the more common “sins” that may cost you money in the market until you learn to overcome them:

1. Perfectionism: 

There is no perfection in trading as far as making money on every trade or having a perfect system. All you can hope to be perfect at, is following your system, rules, and trading plan. Even the best traders only average about a 50%-60% win rate at best over long periods of time. The key is having bigger winners than losers, not being perfect.

2. Fear:  

Faith in your system is the only way to overcome your fear of trading. You must complete enough testing on your system until you know that you have a valid edge over the market in the long term. You must see opportunity in trading not possible losses.

3. Pride:  

We must separate ourselves from the trading. A person’s value is not tied to a trade or performance record. If we followed our system then we can’t view that as a personal loss. Our system failed us.

4. Impatience:

Wait, take your entry signal when it is time and not a tick before your system triggers the trade. It’s important let our profits run their course and not prematurely take them until the trend has run it’s course.

5. Greed:

Traders should not chase a trade when it is to late. We must take our profits off the table when it is time and we should never allow a winner to turn into a loser. If this happens you have nobody else to blame but your greed.

6. Anger:

Do not get mad at yourself.  Learn from your mistakes and move on. Every mistake gets you closer to learning what you need to do to become consistently profitable. Do not get mad at the “market” it is a voting machine and not an entity. Accept your losses and begin again.

7. Recklessness: 

Trading to big of a position size is risky,  reckless, and completely unnecessary. Only enter appropriate sized trades. Follow your system and rules.
We need to first realize what trading “sins” we are guilty of, then we can decide to repent and no longer commit them.

The saintly trader will realize that a trade is only in a long string of other trades and will move on to the next trade knowing that his system will outperform in the long term. He will have complete faith in his trading methodology and risk management.

Stay tuned for the article about the risk management itself!

[cta_en link=”http://m.onelink.me/72dac1a7″ name=”Trade here”][/cta_en]

general risk warning

CFDs are complex instruments and entail a high risk of losing money rapidly due to leverage.

79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

NOTE: This article is not an investment advice. Any references to historical price movements or levels are informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future. Information regarding past performance is not a reliable indicator of future performance. Forecasts are not a reliable indicator of future performance. In accordance with European Securities and Markets Authority's (ESMA) requirements, binary and digital options trading is only available to clients categorized as professional clients.


you may also like