The 30 most costly trading errors

Discussion in 'Trading' started by Cutten, Jun 10, 2009.

  1. The most common and most costly error is the inability to cut ones losses.
    There are psychological barriers to learning this skill, most can't overcome them.
    A few of your errors (like #1,3,4) emanate from this basic trading skill.
     
    #11     Jun 10, 2009
  2. ElCubano

    ElCubano

    the most common and most costly is being underfunded and having no rent money .... if one was set with the bills and had 500k to play with it would be much easier than having 25k and having to pay the bills from there....that's why the hit ratio is so low I think...its like starting a business with very little funds...
     
    #12     Jun 10, 2009
  3. Vienna

    Vienna

    31. Moving your stop to breakeven without a good reason
     
    #13     Jun 10, 2009
  4. noddyboy

    noddyboy

    I AGREE WITH:

     
    #14     Jun 10, 2009
  5. There are a lot of delusional people that think they can make a living trading with 10-25-50k etc.
    I believe the most common and widespread (trading) error is the inability of cutting ones losses.




     
    #15     Jun 10, 2009
  6. #16     Jun 10, 2009
  7. the most terrible mistake people made is they do not know themselves, of course they do not know the market either.

    they think they are smart, but they are not
    they think they can manipulate the market, but the market is out of control

    if you can admit "I am stupid, I am at the mercy of the market", then you will make no mistakes.

    why you did not cut loss? since you think the market will come back (sometime market never comes back)

    why you keep buying/shorting when the market is dropping/ralling? since you think the market will stop dropping/ralling or you think there is a bottom or a top (sometime market has no bottom and no top)


    .......
     
    #17     Jun 10, 2009
  8. Very nice subject ....
    all of the items are true and briefly : LACK OF DISCIPLINE AND LACK OF PATIENCE are the main reasons traders fail.
    and always remember : TRADE WHAT YOU SEE AND NOT WHAT YOU THINK
     
    #18     Jun 10, 2009
  9. NoDoji

    NoDoji

    After 1 year trading I finally got to this point CONSISTENTLY less than 2 months ago.

    There is no better feeling than mastering the ability to cut losses quickly without emotion. NOTHING has given me more confidence than knowing I have a stop in place at my max loss and I don't even for one minute contemplate moving it except in my favor.

    This means there's nothing to distract me from putting on other trades, and nothing to worry about (except a trading halt or overnight gap).

    I can now manage 5 trades at once, no worries.
     
    #19     Jun 10, 2009
  10. One I do not see on the list, is people scalping who have no business scalping.

    You can pay the same entry/exit costs at 30 seconds as you do for 3 days. And that slippage/commissions/errors/fees/etc. can eat up all or more of your expected profits. It is the house rake.

    Learn to trade longer time scales.

    But a great list.
     
    #20     Jun 10, 2009