Lesson learned

[IamTheCasino]

Add only to winners, dump losers (easier said than done).

Repeated by many legendary traders. Also LOL @ saying the market is wrong. Pride goeth before destruction.

Take a break and get back on the horse.

 

[trader1974]

The second entry (if it's adding to a loser) just reenforces a bad habit.

Well, I don't entirely agree.
A second entry is almost always a must to get a better average price.
Why?
I've been trading for 12 years, a basic rule I learned early on is:
What you see is not.
Why?
Well, the price seems to be specially designed to fool day traders.
When you see it (which goes up for example) Purchases.
Very good.
Like you, many other operators have thought the same.
So the vast majority have placed a stop, say, below that 5-minute rising candle.
The price in a great majority of occasions, will return to make the stops jump and then continue rising upwards leaving you with a fool's face.
So: If you already know what will probably happen, why not add a position when the price returns to make the stops jump?
50% + 50% of the position I see quite successful. So, the stop, below the second entry.

 

[smallfil]

Total lack of risk management and position sizing. The stockmarket is littered with victims who refuse to protect their capital. Option Sellers is a big example and had powers of attorney and control of $100 million I believe at the time their trade went south? I am sure there are numerous others. Timothy Sykes too, who ran a $10,000,000 hedge fund and had to close it with huge losses from one position which he did not unwind as it kept going down. His poor friend, lost most of that $10,000,000. I do not know how much skin, Timothy Sykes had on that position and all on one stock? He also, put all his eggs in one basket. There is no such thing as a sure thing except, death and taxes. If you do not have proper risk management and position sizing, you will blow up your account. Only question is when?

 

[JSOP]

You don't want to be smarter than the market.

Actually you do. That's how you win. If you are dumber than the market, the market will chew you out until there is nothing left. Being prudent with your trade size and knowing when to quit and not go against the market when it's not warranted is being smarter than the market.

 

[JSOP]

View attachment 239978

That is one very pregnant orange. LOL

 

[tedmos38]

I think this is a great story and we must learn a lesson from it. Thank you for sharing.

 

[joaomerighi]

Today I want to explain a story that could be real.
There was once a trader who traded every day and did very well.
He started making money and more money.
Since he was doing so well, he began to place higher and higher stakes.
View attachment 239971
He felt confident, so on weekends he went to the best hotels and ate the best seafood.
Obviously I also went to the best car dealerships, I wanted to buy a porsche.
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He felt so confident that each time he forgot what it was like to lose.
Then he began to feel arrogant thinking that he knew everything and the stakes were getting higher and higher.
View attachment 239975
So one good day ...
That day I was not in tune with the market.
The market started to fall but he thought that the market was wrong, since he was always right, he thought that this could not be.
Then he thought:
If the market falls then I buy double because the market is wrong.
He kept falling and thought ...
It can't be, I'll buy 4 more times.
He kept falling and thought ...
It can't be, so he bought 8 times more ...
Like this again and again ...
In his mind he just wanted to win, win and win.
Can you imagine the end of the story?
View attachment 239976
Finally he lost everything he gained and much more.
What is the lesson of all this?
Friend...
Always do the same.
Always risk the same number of contracts during the day.
You don't want to be a hero.
Losses sometimes appear in this business.
Accept them.
Maybe there is some day that is not your day.
Leave it alone.
The markets will still be there tomorrow.
Maybe the price is sideways and is not going anywhere.
Go for a walk.
But you...
Always do the same
Always risk the same.
Every day.
Do not seek revenge.
You don't want to be smarter than the market.
Don't make unbalanced bets just to want to be right or sooner or later the market will put you in your place.
DO THE SAME EVERY DAY!
Hope this can help someone.

Hey brother, thanks for sharing that.

Lesson learned aswell.

Hope you're doing fine.

 

[trader1974]

You have to give thanks to defeats because they always teach you something

 

[bulls95]

You have to give thanks to defeats because they always teach you something
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Yep, that's the spirit. Gotta stay positive and learn from failures.