- “The creation of bad trades is easy: trade your opinion, trade big, don’t cut your losses, just hold on and hope. Bad trades fight trends; they put out a lot money with the risk of making little. The entry and exit signals for bad trades are hope and fear, with the ego stepping in and refusing to honor the stop loss.”
- “Dramatic and emotional trading experiences tend to be negative; pride is a great banana peel, as are hope, fear, and greed. My biggest slipups occurred shortly after I got emotionally involved with positions.” -Ed Seykota
- A good trade is taken with complete confidence and follows your trading method; a bad trade is taken on an opinion.
- A good trade is taken with a disciplined entry and position size; a bad trade is taken to win back losses the market owes you.
- “Ninety-five percent of the trading errors you are likely to make–causing the money to just evaporate before you eyes–will stem from you attitudes about being wrong, losing money, missing out, and leaving money on the table.” -Mark Douglas
- A loss is not when I lose money; it’s when I don’t follow my plan
- Turn down the heat when you are getting smoked (pare back position size, trade smaller in a drawdown)
- A good trade is taken when your entry parameters line up; a bad trade is taken out of fear of missing a move
- A good trade is taken to be profitable in the context of your trading plan; a bad trade is taken out of greed to make a lot of money quickly.
- A good trade is taken according to your trading plan; a bad trade is taken to inflate the ego.
- A good trade is taken without regret or internal conflict; a bad trade is taken when a trader is double-minded.
Install