You are in trading to make money, not to avoid losses

@asamoah_the_great - 4 months ago - Risk Management

Sometimes because traders dont want to lose money, they keep adjusting their stop loss to accomodate a losing position. If you ask them why they are doing this, they will tell you it's because they cant afford to lose money. And like the popular saying goes: "if you cant take a small loss, sooner or later you will take the mother of all losses". Yes, I know risk management is important but too much of risk management will cause you to find a way to talk yourself out of a trade. It;s like a boxer who lost a match because he kept playing defensive and no offensive, the boxer may have avoided getting hit but still lost the match in the end. I beleive in trading the goal should be to keep the losses small, but not to avoid them altogether. Please I would appreciate comments and personal experiences about this.

@hipkin_mike - 4 months ago

it is the fear of losing that will cause a trader to exit a profitable trade early instead of allowing it to run to TP. Its the fear of losing that will cause a trader not to add to winning positions. That is why many know how to trade but few are actually profitable.

@headies25284 - 4 months ago

I have experienced this personally, I hold trades till they hit stoploss and close early when in profit. It kept affecting me . I decided not to close my trade anyhow until my target is met. I target a 1:3 risk to reward which is very achievable for my strategy. Ever since, my trading improved. Yh, I take losses but my wins cover up for my losses.

@aisley - 4 months ago

The truth is that no strategy works all the time so traders need to accept losses as they come withiut trying to revenge trade. In forex trading you have a set of good days and bad days, and theres nothing you can do about it when the bad days come. Ideally a trader should have daily loss limits and once reached, he/she should stop trading.

@emma_durban - 4 months ago

If you are the kind of trader who always like to be right then this might lead you to commit the "sin of early entry" where you enter a trade prematurely because you want to set a tight stop loss. By doing this, you achieve quite the opposite as your stop loss will be hit easily when you fall for a fakeout.

@tiny_ox - 1 month ago

If losses are the only way towards profit, then we move through it; we are not scared of seeing losses in our trading account statement

@tiny_ox - 1 month ago

Some traders spend all their time trying to avoid getting hit, instead of hitting back. Tey spend time playing defense instead of attack.

@yokoyi - 1 month ago

Sometimes the fear of being wrong can make us talk ourselves out of a good trade