A bomb happened once eevry few months

Discussion in 'Risk Management' started by innovest_11, Jun 18, 2009.

  1. Every few months, i will break one of my rule and got carry away and lose a big amount of money. I mean I'm human afterall, and i cannot automate this buying and selling, it is based on charts

    How to prevent this problem from happening every months? I was happily building up my account, and once a while, it will be cut substantially, very demoralising for me :(
  2. give the control to skynet, she will take care of you
    she'll take care of all of us :eek:

    look you problem is discipline, work on it, it gets easier with time
  3. kxvid


    Put all your savings in your brokerage account. You should be more careful if your savings are at risk.
  4. stop overleveraging
  5. Innovest,

    We get posts like this all the time and I just don’t get it. If you can’t follow your rules, you can’t be successful long term. As a professional trader, your JOB is to follow your rules, PERIOD. To do otherwise suggests that trading may not be for you. That is ok. It is not for everyone. It is about discipline and your psychology. Maybe you believe you don’t feel you should be successful or don’t feel like you deserve success and thus engage in self-destructive behaviors. Many people have psychological issues that limit or destroy success. Maybe you fall into that category.

    Granted this is easier said than done but is very important to your success. Not following your rules is akin to a soldier going into battle and deciding using cover or having enough ammo is not important ALL the time. You may get away with it today and tomorrow, but sooner or later, they will probably carry you out. It is the same in trading.

    Think about whether trading is the best use of your time. If you have doubts about whether this is for you, then it is not. You can’t do this half way or those who are 100% committed will quickly take your money. It takes a mature person to realize this is not for them, move on and to find their passion in life. Don’t wait until they “carry you out.”

    Following your rules is one of the easiest things in my book because your rules have your long-term success in mind. It is math and probability. Each individual trade should be looked at with indifference because the next 1000 trades and your account trend tell you what you need to know to modify your rules as needed. To ignore them just means that on some level you don’t want to be trading or should not be trading.

    Best of luck.

  6. good post!
  7. fishing


    sorry if i'm off topic but this is one of the best posts i've seen in this forum so far :)

  8. I second that. The BEST post so far. I think I need to print this out and frame it.

    One thing: going back to the OP. He/she says that a bomb comes his way. and he/she gets ruined. Now it so happens that some of the times. the irrational trade will make him/her money. and that is the MONEY which u need to avoid. . DONT justify that , this time is different and I can get away. when you break your own rules and get rewarded(the irresponsible trade) ,, you tend to justify/glorify it. and then repeat it.
  9. Pita


    First of all what you describe is showing that you are already very advanced and questioning trading in your situation is definitely the wrong advise. You are already miles ahead of the very majority posting on this forum.
    Your problem is that you are too fearful. Security is probably your most important concern and the very majority of your trades are exited with a profit but the exits are not good, well at least not good enough for the risk you took in the first place. Anyway your mind does not stop counting the potential profit after you exited and therewith producing the desire to land a big winner in order to create a buffer for another series of trades (the next stage of progress) that you imaginary plan already based on very different trade management. And exactly the opposite does happen, you wait for the big winner and since a loser in your case can easily destroy the results of many other trades you were diligently collecting money which puts you into a stage of shock, away from reality and open for mind games. Fear and hope in combination as a deadly result in the account (not deadly in your case).
    Discipline as someone else said is the cure but it has to be applied rather on your winners. If you learn to manage your winning trades better you will not have a problem with cutting short losers. Self confidence and positive thinking is the result and you are only one step away.

    What I wrote here was the answer to my own personal question a few years ago and it reads exactly the same than yours.
  10. JamesTan


    #10     Aug 22, 2009