This is my mantra. If you pleasure yourself (taking marginal trades), you can't read the market. And yes db... I think this is how I poke myself in trading. Here per your suggestion: "POKER RULE#101: Don't masturbate or you can go blind." Not from the book but it does sum things up. P.S. hairy palms and knuckles pose no problem in trading.
"POKER RULE #64: Minimize your losses; maximize your gains. The majority of players could significantly improve their game by folding more often when they have bad cards and betting more when they have good cards... For some unknown reason, in this (as well as other areas of life), the average person is not accustomed to betting a lot when things turn favorable... But the problem here, again, is that by doing this, over the long run your win sizes tend to equal your loss sizes. (A good deal of the actual money winning takes place in the difference between win sizes over loss sizes over time - losing $50 on the times you lose, on average, say, while winning $100 on average when you win.)" They sell a lot of stuff on position sizing. I bought a couple collecting dust somewhere. I know a good trader who puts on sizes for high probability setups. I read somewhere if I remember correctly that some great trader puts on 15x his normal size on some big trades. I also heard others went all the way and blew up their accounts. I have nothing to say because I have no experience in the mathematics behind risk controls. However on a different aspect of this, I remember an ET thread written by MaxMin: http://www.elitetrader.com/vb/showthread.php?s=&threadid=27743
There are decisions that must eventually be made, if only by default, that have little or nothing to do with mathematics. For example, The Wise will snuffle and harumph about taking what one can get rather than going for home runs. They'll tell you to set profit targets, which is, essentially, not much different from taking profits quickly. Therefore, even if one has a nice win/lose ratio, his profit/loss ratio may yet be anemic, and one big loss (they happen, and for reasons that one can often do nothing about) can wipe out the profits resulting from quite a large number of trades. Losing 50 and making 100 can keep a trader with only one foot in the winning column. Losing 50 and making 500, however, is another matter, and at some point, the trader must shut out The Wise and what may in fact be nonsense and look within to determine just what it is that he wants. Is trading a great deal and taking all those small wins -- assuming that they appear -- really the road that he wants to take? Or does the prospect of waiting for better setups, entering the flow, and adding to his positions as the trade develops seem like a more interesting and attractive prospect? A lot of pseudo-wisdom is bandied about on message boards, and putting all of it under the microscope is never a bad idea, no matter who it comes from.
It may have a lot to do with mathematics. Setting profit targets can be an exercise in anxiety control (possibly bad) but it may also be based on measurements of moves made in your chosen tradeable and may result in very good risk/reward ratios. I don't know what you trade but I find that with the Hang Seng on my timescale this results in much better outcomes than, say, trailing stop strategies. The great thing about trading is that there are many different wisdoms that can result in profit (and as many foolishnesses, which look very similar to the wisdoms, that result in loss). Do your own homework
Really tough... but it also has to do with what market you are trading and account size too. I think to always expect a large move for stellar setups would incur sizeable drawdowns in a small account trading ES. Maybe some very good trader out there would tell me otherwise. Some of us really have no choice but to scalp. Yes, a couple of V tops and bottoms could really screw up my P/L. Sometimes I do trail a stop in high momentum situation. But I know what you mean, one minute of waiting could worth a whole morning of trading. One badly executed trade can wipe out a whole day of work. It is a very hard equation to balance. However one got to take a stand and try to work with it.
"POKER RULE #63: Play tight and defensively until you have something - then bet a lot... For it to work, you have to keep doing it, not get swept up in the action and let it slip from mind... Would it be fair to the other players in the game if everybody had to put in $40 or $50 whenever you had good cards, but only had to put in $5 or $10 when they had good cards? The answer would be no, it wouldn't be fair at all. It would give you a big advantage in the game... Bet heaviest at the strongest times." Pick your best spot and play the odds. Always! Don't play every race. Otherwise there is no point in trading.