This is one of my biggest enemies. I'll have a pre-determined target, whether entering or exiting, and I'll get impatient/nervous and pull the trigger early. Maybe 8/10 times it will turn out that had I WAITED and STUCK with my original plan, I would've saved some money in my execution costs... When I have a stop in mind, quite often all it does is ensure that I'm going to find a reason to get stopped out. Anyone have this problem? Were you able to work through it?
bungrider: One way is to try to reverse your thinking. If you tend to pull the trigger early prior to your signal telling you to ENTER, think of how much itâs going to COST you (e.g. execution costs, as you mentioned or trade not working out, or botched up opportunityâ¦), if you entered prematurely. If you are inclined to pull the trigger before the market reaches your pre-determined target (I'm assuming it's your profit target) to EXIT, due to nervousness, think, instead, about how much MORE you might PROFIT if you just left the trade alone and let the market do what itâs got to do to reach your target. Hope this helps. Kermit
Cover up your order entry screen with a graph "or what ever", this will slow you down a second and keep you from impulse trading White
Yes, I admit to the problem big time. My only solution was to remove myself entirely from any descretion other than position sizing, and set up my computer systems to signal me. I have audio and visual alerts for buy and sell signals, and my speakers turned up full blast so I can hear it anywhere in the house. It also helps to recall the many days I left a LOT of money on the table by trying to beat my own system with my judgement. So I try...as hard as it is...not to get emotionally involved in any open trades. Certainly, for me, the hardest part of trading, and the hardest lesson to learn.
I have the exact same problem. I have decent entry points, but I exit my position 10 - 20 cents early. This has been happening for several months. Started trading size and can not help myself. Patience is so important, but can not help myself. Any ideas, would love to hear them.
I had this problem for a couple years! Still do occaisionally. I prefer to trade for targets, and then let half the position ride when the trade is looking good. Problem is, I stress out and wish to take profits too early. I solved this by using stops or target limits to almost always exit trades. My target limit order often goes in before the trade, so I'm at the front of the line. Once I enter a trade, a stop goes in immediately. Then I sit back and do nothing but move the stop. If I get really nervous about a trade, I may move the stop pretty tight, but I don't just bail. The only exception to this being some obvious strong reversal. I may bail before my stop is hit in this case. I do this about 5% of the time. Yes, this is subjective. When I find myself doing this too often, I completely systemize the process for awhile meaning no "bails" no matter what. Overall, I like to have a little subjective control though. I trade only 5 to 10 times per day, and only hit my target on 30% or so, but also have small winners when trailing stops go off. The target trades are all my profit as the little guys get offset by losing trades. This may sound simplistic, but it has made a big diff in my results. Jay
i think time and experience will help. it's helped me. still is. is it impatience, or getting faked (fear), or some combination? one thing i've been meaning to try for a position trade is to treat it like an option trade -- i.e. if i'm going long, i'll risk a fixed amount and mentally write it off, as though i just bought an option, and then concentrate on tapereading, technicals, the Gann wheel, etc.
I think it's combination of both fear and impatience, wanting to lock in a profit due to big size I have on. I have closed down my p&l window so the actual numbers do not bother me. Fear I would say is a bigger impact.
i think it's true for the species... some may deal with it more effectively (at times). I truly believe that fear will diminish as competence improves with experience (learning your edge) but, if you're always reaching, then you'll always have to... <b>fade fear.</b> sometimes ya gotta just do the scary thing.