Which is the bigger demon in trading?

Discussion in 'Psychology' started by Matt24SPFL, Sep 27, 2007.

  1. Fear or Grandiosity?

    (Grandiosity is having an unrealistic expectation that you will succeed.)

    I'm curious to hear from some of the vets.
  2. jjf


    They are different sides of the same problem.

    They both reflect a lack of appreciation and understanding of the subject matter, be it trading or any other endeavor.
  3. Agreed. Fear causes you too freeze which can kill you.
  4. Great answer ... in the end, we all think we can "make it" at this game, so he's right, it doesn't matter if you're losing money, because you "think" you can always turn it around.

    Good trading,

  5. Never really thought about it from that angle..

    Very true.

    Then where do you draw the line between being aggressive and being greedy? Are you greedy for risking more than 20% of your capital on one trade? What defines greed?
  6. Stock is up a buck then retrace to 50 cents ( or some amount). Greed is when all you see is that dollar of profit you had.. The focus is not where you're at but rationalizing, wanting that whole dollar back. You hold, tomorrow it'll go up. There are other definitions.
  7. Grandiosity. It makes you take bigger positions than you should and you forget about all scalability issues.

    Fear is actually good, it keeps you conservative. I wish I was always afraid, it'd make me a much more disciplined trader.