Turning a big winner into a big loser requires a hell of a lot of trading range. And from my experience working with clients - it’s not very common. If anything, traders tend to take profits too soon. Cannon balling (adding to losers) is much more common and certainly more ruinous.
Not looking at the big picture. Not asking myself...Can you trade this? Do you like to trade this? How much money do I want to make? What would be good? Can I trade with minimum exposure and make a living? Understand why my system works and what timeframe to use. Can I take breaks in between my trading sessions? Not having more than one system. Keeping my trading edge private.
- overtrading, not being selective enough (best are minor gap continuations like MU yesterday, "out" of prior day's range should be 90% of trades vs "in" S&P days or stock/etf charts) - not getting comfortable trading large 3-5k shares - overthinking t/a at times vs price action - giving back morning profits in afternoon 1-3pm trades - death of a thousand cuts during choppy days i should've skipped - becoming overly focused on favorites vs daily gainers - taking profits too early - not drinking my 3 cups o coffee, trading tired - getting distracted by my hot asian wife
Trying to be creative. "Maybe I should try X on a Y scenario" instead of sticking to something that works.
I never made the same mistake twice. But I did meet the aunt, uncle, brother, cousin, niece, nephew, sister, mom, dad, grandma, and gradpa of each of those mistakes.
Hahahahaha absolutely true. Once you get to know the whole family it gets easier to avoid them, though. That's why I urge new traders to stay as long as needed in the simulator. Why waste time and money learning all the shades of wrong, when you can waste just the time?
If you have the strength of mind and will necessary to treat sim losses with exactly the same seriousness and discipline as you would real ones, then you won't need the simulator anyway (except for maybe learning the quirks of a new platform.) It probably wouldn't take more than forty or fifty years of Zen practice to get there...
That's not the point, because the sim is not meant to train psychological skills, it is meant to train one's operational skills. If a wannabe trader can't obtain consistent results on a simulator, why the hell would they be able to do that in a real live market? The thing most people get wrong is that you shouldn't try to train all the skills necessary for trading at once (i.e.: jumping straight into a real account). Once you actually have a grasp on a given strategy, which you apply on the simulator in a disciplined manner and generate consistent profits, then you are ready to step up your game and go into real trading. Otherwise it'd be like trying to learn how to fight by picking a fight with a seasoned MMA athlete. First you master the basics, the you move into more challenging stuff.
You're conflating unrelated things here. Granted, the sim environment will help you learn the skills for operating a given platform. But if this is a serious challenge to someone, then perhaps trading is not the field they should be in. Successful trading, though - which you include as soon as you mention "consistent results" - is a non-starter. Actual fills, price discovery, reasonable position sizing (and paying the costs of not doing so), confidence in trades vs. the commitment of capital, risk tolerance, endless other things in addition to the psychological impact of placing real money at risk are things that no simulator can teach you. In fact, after a certain point, staying in a sim environment begins to damage your learning process: you're overfitting. Learning the skill of playing the sim game - which only resembles real trading superficially. "Try[ing] to train all the skills necessary for trading at once" is a strawman. One that has nothing to do with a sim account vs. a real one. If someone doesn't know how to learn, then that's the problem they need to resolve regardless of the environment they're in. As to "jumping straight into a real account" - I see the value of making even a single real trade as being qualitatively higher, by orders of magnitude, than playing endless fake games. Putting a hundred bucks into an account and making penny trades against it will teach real lessons; learning to game the inefficiencies in a toy system (which you will inevitably skew toward doing as you play one) will teach you the wrong ones. What you're proposing is playing UFC Undusputed 3 "until you're ready" to fight that MMA athlete. That may be a good route to experiencing some surprising and unpleasant sensations along with large hospital bills, but it will not get you even an inch toward winning.