What according to you is an effective way to deal with losses when you have a bad week/month ?

[adonisperry]

Big facts!

Thank You. Being neutral is the key.

 

[kroxobor]

It may be useful to reduce lot size and recover slowly rather than betting on luck and try to revenge market.

 

[nickiewinters]

It is easy to find an excuse for the loss but it is very difficult to repair the mental damage that usually happens after several losses or just one big loss. Traders begin to question themselves and lose their self confidence but it is important to bounce back even stronger than before.
The first step to deal with the losses is to accept the responsibility and start with the basics again. Make adjustments to your trading plan, build strategy, practice and rebuild your confidence.

 

[kroxobor]

It is easy to find an excuse for the loss but it is very difficult to repair the mental damage that usually happens after several losses or just one big loss. Traders begin to question themselves and lose their self confidence but it is important to bounce back even stronger than before.
The first step to deal with the losses is to accept the responsibility and start with the basics again. Make adjustments to your trading plan, build strategy, practice and rebuild your confidence.

Yeah and it is crucial to avoid large losses because our mind tends to make decisions that attempt to get rid of pain as quickly as possible and it's often not the best way to recover because this often implies taking unreasonable risk

 

[Handle123]

Trading is one business that takes a lot more discipline and emotional strength than anything else
after gaining some experience in this industry you realize losses are inevitable,
then comes the real deal on how you handle them and keep moving consistently.

Series of losses can create self doubts, stress and causes emotions to take the wheel
and this is just a part of the journey...
How you overcome that and stay consistent defines your edge in the market.
that being said, what do you feel is the best way to deal and overcomes such days ?

I often read where someone's backtesting was a few months, I may over do mine, but mine is often over ten years for intraday and up to 35 years on stocks, this way you can experience when markets going in different major trends or at ends of trends. I do know whatever I test, the highs/lows will be exceeded at some point.

Intraday, if tested far enough, one day or week does not mean system has stopped working, but market not cycling to your system as usually does, take few days off and test, perhaps slightly larger or smaller timeframe needed.

 

[murray t turtle]

It may be useful to reduce lot size and recover slowly rather than betting on luck and try to revenge market.

%%
GOOD;
trend follower John H said what some call luck/ he calls a small sample size.
Losses are a business expense + NO such thing as a business without expenses.

 

[kroxobor]

I often read where someone's backtesting was a few months, I may over do mine, but mine is often over ten years for intraday and up to 35 years on stocks, this way you can experience when markets going in different major trends or at ends of trends. I do know whatever I test, the highs/lows will be exceeded at some point.

Intraday, if tested far enough, one day or week does not mean system has stopped working, but market not cycling to your system as usually does, take few days off and test, perhaps slightly larger or smaller timeframe needed.

Unfortunately it's very difficult to tell if your system don't have an edge or trades in just wrong market regime, or proper "market regime" was just some luck however comparisons with buy-and-hold may give some valuable insights.

 

[murray t turtle]

I believe that the best way to deal with your losses is to regard them as an opportunity to learn.
First of all, you should admit that your trading strategy has some drawbacks which prevent you from making profits. This step is the key one because without admitting the problem, there is no chance that you'll ever correct your mistakes. After admitting it, you've got to start looking for the exact place in your methodology that lacks something. I would advise to forget about real trading and concentrate on finding the weak chain of your strategy. You'd better decompose the decision making process that you've got and see, what causes your losses.
So, if you have a long streak of losses, you should understand that the problem lies in your strategy and you should change your systematic approach to trading.

%%
Good/education.
Depends on the seasons also. IF i lost on SEPT seasons, with inverse ETFs\ that would not bother me much, because SEPT sells in stocks is one of the most common patterns. ONE week is almost NEVER enough time to confirm a good trend. ............

 

[Raheel Shaikh]

%%
Good/education.
Depends on the seasons also. IF i lost on SEPT seasons, with inverse ETFs\ that would not bother me much, because SEPT sells in stocks is one of the most common patterns. ONE week is almost NEVER enough time to confirm a good trend. ............

well said

 

[nickiewinters]

Yeah and it is crucial to avoid large losses because our mind tends to make decisions that attempt to get rid of pain as quickly as possible and it's often not the best way to recover because this often implies taking unreasonable risk

I agree and the only way to avoid big losses is by working on risk management and capital preservation.