Losses are just cost of doing business
If you want to be a trader, accept that Losses are just inevitable
Better take a small Loss, than letting it become a big Loss
Yeah, I know all that, but...
Do you recognise yourself?
I DO!
Taking a loss is only ok, if I cover my trade at a loss and then it goes at least 50 ticks further against my initial position. Then I feel not good, but at least correct.
But which trade do you remember? Yes, exactly. The trade which turned right around, which faked you out, which took your Stop and then proved your initial trade correct. This is the trade where Fear let you place your Stop too tight and now, when you see your position down again, then Hope comes in telling you, it will turn around by letting you know the last time where you were stopped right at the Top or Bottom. And that of course is the start of the small Loss becoming a big Loss.
I have Losses as everyone in trading has. And if someone tells you he has a 100% system, don't believe it, walk away, he is just out to get your money.
And I have found just one way to deal with Losses:
A Loss is a Payment to the market I have to make to see, if my analysis is correct or not.
If you want to be a trader, accept that Losses are just inevitable
Better take a small Loss, than letting it become a big Loss
Yeah, I know all that, but...
Do you recognise yourself?
I DO!
Taking a loss is only ok, if I cover my trade at a loss and then it goes at least 50 ticks further against my initial position. Then I feel not good, but at least correct.
But which trade do you remember? Yes, exactly. The trade which turned right around, which faked you out, which took your Stop and then proved your initial trade correct. This is the trade where Fear let you place your Stop too tight and now, when you see your position down again, then Hope comes in telling you, it will turn around by letting you know the last time where you were stopped right at the Top or Bottom. And that of course is the start of the small Loss becoming a big Loss.
I have Losses as everyone in trading has. And if someone tells you he has a 100% system, don't believe it, walk away, he is just out to get your money.
And I have found just one way to deal with Losses:
A Loss is a Payment to the market I have to make to see, if my analysis is correct or not.
In trading you have a Trading Plan, a Setup and you take it, the moment you see everything in place. You not only know, that your Setup is present, but you also know at which price a contract has to trade to make this Setup invalid. Add a tick or two and you have your Stop Loss. This tells you BEFORE you take your trade, what you have to pay to the market to see. To see, if you are right or not.
by Globe Trader
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