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Remedy for big losses?


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Remedy for big losses?

  #11 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
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To train your mind about the money relation, compare it with food. Do the exercise. Is food limited? I know you like food, your mind like food but why if you like it, why your mind is limiting it? Think in the psysicall limits, your mental believes, what you know. Basically you have learned a relationship. Do the same with money.

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  #12 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
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Real live example:

Yesterday I win 1,8k. Today I win 92$. I blocked my trading for the rest of the day. Why? Simple. Training self control. Compared to yesterday, 92 is nothing. My mind knows that. I will show my mind whois in control.

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  #13 (permalink)
fxSOL
Belgrade Serbia
 
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ignacio90 View Post
To train your mind about the money relation, compare it with food. Do the exercise. Is food limited? I know you like food, your mind like food but why if you like it, why your mind is limiting it? Think in the psysicall limits, your mental believes, what you know. Basically you have learned a relationship. Do the same with money.

Sorry for my late reply. Sorry but I can not comprehend the analogy.
I want to be more efficient in my trading by cutting of the bad stuff, just as a company get rid of bad employees.
There is plenty of food at my end but instead of making the harvest in 1 year I could half the time by cutting of the bad =)

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  #14 (permalink)
cha0
Toronto, Canada
 
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I think the most important thing is to always define your risk/maximum loss on each trade and place it immediately when entering. When I execute for both stocks and futures I always bracket in with both the targets and stops set. The targets can sometimes get moved around to cut early if incoming market information is changing my opinion of the trade, but the stop is never moved further down, this way the maximum $ risk is priced in from the outset. Try and think not just 'at what point am I wrong', but also setting your max risk from the start so that you can't convince yourself to take a larger risk during the trade. And if you are really having trouble then maybe use a platform that has risk controls which can flatten your positions and prevent you from trading if a max daily loss has occurred .

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  #15 (permalink)
 
DavidHP's Avatar
 DavidHP 
Isla Mujeres, MX
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The problem is between your ears.

Maybe this will help.

Rejoice in the Thunderstorms of Life . . .
Knowing it's not about Clouds or Wind. . .
But Learning to Dance in the Rain ! ! !
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  #16 (permalink)
ArkansasClint
Little Rock, Arkansas
 
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I had a similar problem at a firing range one time. I kept pulling my shots to the right with a pistol. I diagnosed my problem as a trigger pull issue. I asked the range master what I needed to do to stop the pull that was skewing my shot. He looked at me and yelled, "JUST STOP."

Yeah. That didn't work for me.

However, I read this book, The Mental Game of Trading, by Jared Tendler, and I think you might find it helpful.

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  #17 (permalink)
 ZB23 
Atlanta Metro Area
 
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fxSOL View Post
Greetings to all warriors out there !

I have a problem (well I have many) but one big when it comes to money management. I can be the best trader in the world with insane record profits, but as often when times are good I increase positions and risk and doing all madness, which is a built in behaviour I can not get rid of since my days as a rookie trader.
Don't know if its a greed issue or just bad behaviour or both?

This results in unnecessary big losses making it hard to hit profit target each year. And adding to this I have lost a screw or two in brain when it comes to big loses - I just become emotionless caring little that I lost just 20K which is real madness.

And I always repeat same bad behaviour when it comes to big losers - I keep holding positions because I KNOW I AM RIGHT, and when the losses are to big I have troubles closing because brain say "you are right".

Anyone with a remedy for this bad behaviour or a strategy for this?
Think I am not alone doing this but I can not figure out what is the best way to get rid of this bad behaviour.

Cheers to all

In 2017, I lost $35,000 in 15 minutes on CL spreads. Something funky happened that year that caused oil to be very volatile. I believe it occurred March of that year, but I'm not sure. That's the biggest loss I had ever.

To answer your question, the only way to break your bad habits is to reach your maximum pain point to the point where you are truly humbled. That might be difficult for you, because you've conditioned yourself to be "emotionless." My breaking point was the aforementioned loss.

In addition to experiencing my most painful and humbling moment, I took a few years off to learn how to code my strategies. With algo trading, the rules and risk management are hard-coded thereby drastically reducing my chances of doing something stupid.

I don't algo trade all the time. Occasionally, I trade manually. Even when I trade manually, I don't practice the bad habits that subject me to large and dumb losses.

What's your breaking point that will cause you to have an "ah ha" moment and change your ways? 50K? 100K? 🤮🤮

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  #18 (permalink)
 ab11 
Rochester, Minnesota
 
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ArkansasClint View Post
I had a similar problem at a firing range one time. I kept pulling my shots to the right with a pistol. I diagnosed my problem as a trigger pull issue. I asked the range master what I needed to do to stop the pull that was skewing my shot. He looked at me and yelled, "JUST STOP."

Yeah. That didn't work for me.

Actually the reason your shots were missing was because you were flinching. Your brain learns the exact moment that a violent explosion will go off in your hand, so it causes your body to flinch in preparation of it. Your brain is trying to protect yourself. You don't notice it because it happens a split-second right before the shot goes off. They say you can train yourself not flinch by pulling the trigger really slow and stopping right before the shot goes off.

Similarly with trading, your brain learns that losing a trade brings bad emotions, so it will cause you to stay in a losing trade to avoid the pain of losing. Your brain is trying to protect yourself in this situation as well. You can train yourself to stop doing this by getting used to losing.

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  #19 (permalink)
 
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 ES Jedi 
Las Vegas
 
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  #20 (permalink)
Churchmouse
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I still keep adding to a loser if I am not trading with the plan I have.
Hit the close button and go take a walk..

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