The Risk Manager Cometh

Discussion in 'Psychology' started by cdowis, Jun 29, 2010.

  1. cdowis

    cdowis

    The market goes strongly against me. I see potential major loss.

    The risk manager cometh -- he tells me to cut the position in half.

    Now, here is what happens when the risk manager comes == I lose money, and three out of four times the market goes back into my favor. I usually get out at the worst price.

    But the risk manager also helps me avoid catastrophic losses once out of four times.

    So, small guaranteed losses vs avoiding a serious loss.

    Yes, it is frustrating to see the market come back, yes, it is frustrating to get out at the worst price -- "if only I had hung on a little longer".

    But I feel that sigh of relief when I avoided tanking my account. I am still in the game.

    Remember that whenever you hit your stop/loss and want to wait just a little longer.
     
  2. The risk manager is "fading" you. :(