Here are seven trading sins that are hurting you:
- FOMO. You enter trades you shouldn’t, because you fear being apart from the group. This usually doesn’t end well because you enter at the worst time.
- Loss aversion. It’s fear of taking losses, otherwise knows as loss aversion. This manifests itself in two ways. Either you don’t take the trade because you are scared to lose, or you ignore you stops and end up taking losses too big for you account size.
- Lack of discipline. We do well when things are going good. That’s when it’s easy to be disciplined. We stray when things are going bad. Be vigilant about adhering to rules during a string of losses.
- Envy. Stop watching twitter and it’s ilk if you can’t handle the chest thumping. There is always someone doing better than you. Plus, you don’t really know if they are.
- Greed. No matter how good things are, you always want just a little more. Don’t get greedy. The lottery ticket is not likely to hit. If you allow greed to take over, you will break your rules.
- Review. Spending quality times studying your trades is not the most exciting aspect of trading, but it is the most important. It’s where you learn the most. Unfortunately, most traders don’t review; and those who do don’t do it enough.
- Equating money to things. Money only keeps score. Money allows you to grow incrementally. Don’t equate the money to material things. A 30k trade is not a car or college tuition. It’s the means to compound and grow your account.
This is post #5 of writing everyday until the end of the year. It may be a little or a lot. Some of it good and some of it bad. I might miss a day or three, but I will try to write something everyday.
For more on swing trading check out my swing service at bullsonwallstreet.com
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