Today I want to explain a story that could be real. There was once a trader who traded every day and did very well. He started making money and more money. Since he was doing so well, he began to place higher and higher stakes. He felt confident, so on weekends he went to the best hotels and ate the best seafood. Obviously I also went to the best car dealerships, I wanted to buy a porsche. He felt so confident that each time he forgot what it was like to lose. Then he began to feel arrogant thinking that he knew everything and the stakes were getting higher and higher. So one good day ... That day I was not in tune with the market. The market started to fall but he thought that the market was wrong, since he was always right, he thought that this could not be. Then he thought: If the market falls then I buy double because the market is wrong. He kept falling and thought ... It can't be, I'll buy 4 more times. He kept falling and thought ... It can't be, so he bought 8 times more ... Like this again and again ... In his mind he just wanted to win, win and win. Can you imagine the end of the story? Finally he lost everything he gained and much more. What is the lesson of all this? Friend... Always do the same. Always risk the same number of contracts during the day. You don't want to be a hero. Losses sometimes appear in this business. Accept them. Maybe there is some day that is not your day. Leave it alone. The markets will still be there tomorrow. Maybe the price is sideways and is not going anywhere. Go for a walk. But you... Always do the same Always risk the same. Every day. Do not seek revenge. You don't want to be smarter than the market. Don't make unbalanced bets just to want to be right or sooner or later the market will put you in your place. DO THE SAME EVERY DAY! Hope this can help someone.
In 1996-2000 I averaged $XXXk trading while working for $20 a hour as a night guard and repair man. Most of my friends who made seven and eight figures laughed at me for working. Soon in 2001 they blew up because they lost touch with how hard it is to make that tough easy money! Sorry you got hurt, hope you made it back whole as a person and money wise.
As Bill Eckhartd said in New market wizards 'as a general rule: losses make you strong and large profits make you weak' We have all made this kind of mistake buying more in a nasty downtrend
I try to treat myself to a nice a meal on a big losing day (assuming i followed my rules) But can hardly ever manage it. Good food and drink tastes even better when you had a big winning day.
,,- Kid , you are going to blow out'' - Maybe...'' Next thing down the line, - it happened. And i don't remember who left first, the sports car or the model girl. '' - Icahn, about his first taste of success, during his youth.