Trading Mistakes

C

Cutten

What are the most common, damaging, and avoidable mistakes you can make in trading? Let's start a list - I'll throw in a few to begin.

1) Taking too much risk/trading too much size
2) Letting a loser get out of hand
3) Failing to have a stop
4) Not having a trading plan
5) Going "on tilt" e.g. revenge trading
6) Getting married to a position
7) Thinking "it's different this time"
8) Trading on tips, rumours etc
9) Taking profits just because you have them
10) Being inadequately capitalized
 
I can think of two off the top of my head:

1. Improper backtesting & curvefitting of data.

2. Overtrading or trading when your system/plan is flat.
 
Quote from Cutten:

What are the most common, damaging, and avoidable mistakes you can make in trading? Let's start a list - I'll throw in a few to begin.

1) Taking too much risk/trading too much size Only trade profits; remove your original capital when you have doubled original capital
2) Letting a loser get out of handOnly trade on the right side of the market; you know this by the fractal's trend.
3) Failing to have a stopSee 2 and always reverse as right side of market changes and before price heads to where the stop was on the other side of the former trendline that endedTrends overlap; get on the new one when and where it begins.
4) Not having a trading planthere is only one plan. Use all market principles only and 'know that you know" at all times from these principles.
5) Going "on tilt" e.g. revenge tradingUse emwave pc to assure all trading is parasympathetic and NOT sympathetic. Go green.revenge trading is at 50% of 0-2 minimums.
6) Getting married to a position{color=red]Marriage is commitment to the trend; divorce is the beginning of overlap in the next trend marriage. Always be married and know you know why[/color]
7) Thinking "it's different this time"It is never different. Sequences of the market are the rock foundation and they never vary.
8) Trading on tips, rumours etcThe market is always right and always speaking
9) Taking profits just because you have themHold as long as you are on the right side of the market. See 2, 3 and 4.
10) Being inadequately capitalizedAll traders start at the same capital value: 1 contract or 1 lot. Profits made determine the right to trade. See 1.
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Knowing the market and seeing the market are requirements. In a partnership with the market, the market offers (speaks) and you obey.

The principles are few and complete.

1. Price change is how money is made,

2. You have to be in the market to make money.

3. You have to be on the right side of the market to make money.

4. The variables of the market, P and V must be regarded and the market follows the P, V relationship.
 
Quote from Mike805:
I can think of two off the top of my head:
1. Improper backtesting & curvefitting of data.
2. Overtrading or trading when your system/plan is flat.
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Good ones Mike. How about:
1. Not using market volatility metrics in trade size calculations.
2. Not enough system diversification.
 
Quote from nazzdack:

11) Spending too much time at message board sites. :cool:
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12) Surfing porn on the net - especially during the trading day
13) Posting *anything* on *any* "chat" or "politics" or "religion" forum, *anywhere*, *ever*.
14) Following "gurus"
15) Not paying much attention to mistakes, thinking about big winners, success etc.
 
I have to say hands down it's not hitting your out and averaging into a trade...

Surfing the web is a bad habit I have. I'll be surfing, I'll see something from the corner of my eye, jump in and !wham! get nailed

Quote from GermanTrader:

16) Leaving the workstation unlocked and at risk to cat paws. Can you say hotkeys?
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Not taking a loss quick enough, not being patient enough before entering a trade

Then there are also stupid fat finger mistakes I make occasionally, buying instead of selling for instance.
 
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