The Mind of the Losing Trader
- Winning Traders have faith in their trading system and do not jump from one system to another during losing steak.
- Almost all winning traders have come back from blowing up their accounts or losing a lot of money, they persevered while many others quit before they won. You will have to do the same if you do not understand the risk of ruin .
- Most winning traders have learned to separate their trading from their self worth and ego. They treat it like a business not an ego trip.
- Winning Traders trade a robust system or method that wins more money over time than it loses.
- Winning Traders system or method is proven to work and back testing should always be done manually on any system so as to understand the emotional swings traders can come across on winning and losing streak.
Trading with Managed Risk
- Winning Traders manage the risk of ruin to avoid blowing up their account.
- They manage risk through proper position size so they do not risk their account and ability to trade in the future on any one trade.
- They do not risk more than 6%-12% of their capital at one time across multiple trades.
Your focus in your trading career should be like a laser on finding the right system & method, learning why it is so important to manage risk then doing it, and having the right mind set to stay disciplined, passionate, and focused to get into the winning circle. With these three elements incorporated into a trading plan you will eventually win big. If you are missing any one of these three elements in your trading the odds are that you will be out of the game quickly either after a string of losses, loss of faith in yourself or system, or loss of belief that winning at trading is even possible for you.