The fox knows many things, but the hedgehog knows one great thing – Archilochus
And that one thing in trading is, dealing with losses.
Every trader has been there. You’re finally starting to feel confident in your trade. You’ve found the right stock that matches your goals, have set your buy points, profit targets, stop loss and are all set to enter the trade. Things go good for a bit, then one day you wake up and your position is down 35%. Situations likes these leave you to wonder what you did wrong and question yourself why did you start trading in the first place.
Whether or not you’ve been in a similar situation before, you have to have the right trading psychology to overcome such instances. Here are simple ways to get your mind off the loss and back in the game:
Call it Quits for the Day
Taking time off from trading can re-motivate you. You could be doing everything right, yet still be losing. Go for a walk, catch a movie, workout. Do something to take your mind off things. And when you feel ready, get back to what you were doing before, succeeding while trading!
Look Back on your Winning Trades
Look back at your winning trades. Remember how happy you were and how it felt to be trading. Also look back at your first win after your first losing trade. Realize that you can get back on the horse because you already have! If this trade is your first loss, then there’s good news for you – your next win is just round the corner!
Know that even the best Traders Lose
No trader is immune to losing. Even the most successful traders have had their fair share of major losses. Understand that losing is part of the game. Don’t beat yourself up over a dialed trade, especially if you had a clear plan in place.
Get back to the Basics
Trading is mental warfare. When you’re losing, it can feel like the entire world is coming down on you. Pick yourself up and re-assure yourself that you can do this! The best thing that you can do after a major loss is getting back to the basics of trading. Take some time off and revisit your trading course. But make sure that you don’t change your entire trading strategy! Get back to the basics of what your strategy is and why it is effective.
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