What do you do after a losing trade?

What do you do after a losing trade?

  • I move on to the next trade. I am 100% satisfied with my loss and don't look back

    Votes: 9 23.1%

  • I move on to the next trade but also look back to see if I could have made a better decision

    Votes: 22 56.4%

  • I shut the computer off and try to think about why my trade was a loss, with no looking back

    Votes: 0 0.0%

  • I stop trading for the day but keep looking at the chart I lost in to learn from it

    Votes: 1 2.6%

  • I don't get out of a losing position until the chart turns back in my favor. I am never wrong.

    Votes: 7 17.9%
  • Total voters
    39
soulfire said:
have your specific entry area, profit target price, and stop-loss price all determined in advance before you pull the trigger.
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soulfire,

I have notice in my trading when I do this, I am more calm rather than exiting at market orders, and deciding my stop loss after I enter the trade.
 
Trader Curt said:
I like to be 100% sure of my decision making. And when I exit a losing trade, I can't help but look back and see if I could have held longer. I also think this is a bad idea because it could affect me psycologicly. But then again I also think it could be a good idea because I could learn from it. What do you do after a losing trade?
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Depends upon the type of trader you are...scalping, day trading, swing trading or position trading.

For example, if you're swing trading 1 - 3 trades per month and you get a losing trade...you have time to reflect, review your trading plan and to make sure you have on your mental cap.

Yet, if you're scalping (+50 trades per day)...you don't have time to reflect and such because if you do that you'll miss trade opportunities.

Also, it depends on when the losing trade occur. If its your first trade of the day and the average time between your trades is 15 minutes...you have less time to think about the loser than someone that gets a trade loss in their last trade of the day.

Simply, there's a few variables involved that will psychologically impact what you do after a losing trade...just the same for a winning trade.

I myself hate getting a trade loss in my last trade of the week prior to a weekend break or prior to a long holiday that involves a 3 day weekend.

wrbtrader
 
Analyzing each individual trade is useless in the context of 50 or 100 trades. It means nothing. UNLESS you have one of those individual trades that ate your entire account, and that is a big risk management concern (and psychological).
 
MattZ said:
Analyzing each individual trade is useless in the context of 50 or 100 trades. It means nothing. UNLESS you have one of those individual trades that ate your entire account, and that is a big risk management concern (and psychological).
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Only by reviewing your trades you realize that you may have made a mistake. That is what a trading journal is for. Repeat the same mistake multiple times over the course of a year and it is not minimal! If you have say 20-30 trades that you could have avoided or handled differently, your bottom line is affected! Even at 2% risk per trade, you lose 5 trades and now, you are down 10% of your account value! Lose more, the bite goes even higher!
Reduce your mistakes, you improve your performance and increase your profits!
 
smallfil said:
Only by reviewing your trades you realize that you may have made a mistake. That is what a trading journal is for. Repeat the same mistake multiple times over the course of a year and it is not minimal! If you have say 20-30 trades that you could have avoided or handled differently, your bottom line is affected! Even at 2% risk per trade, you lose 5 trades and now, you are down 10% of your account value! Lose more, the bite goes even higher!
Reduce your mistakes, you improve your performance and increase your profits!
More...

Your math is off. If you risk 2% per trade, you do not add 2% as if you start over. So after five trades, you would be down less than 10%.

Second, I did not suggest not to analyze trading, and I am a big advocate for analyzing your data. But, I recommend having a macro view as opposed to analyzing each trade. The problem of analyzing each trade is you as a trader will fall into the "intuition" trap and will be prone to change your method which could be fine, but you tweaking it would make results worse.

Lastly, a trading journal purpose is not to analyze each trade. It is to gather more extensive statistics and detect anomalies in your trading that you would not be able to recognize intuitively. Examine something like https://optimusfutures.com/tradeblog/archives/edgwonk-trading-analysis-software-futures-traders
 
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