Nowadays no matter how many trading system variations i make, one thing i always make sure is to take utmost care of my losses. What i realized in trading is " Managing loss is all we can/have to do , profits are just mere consequence of that ".
When i was making only losses few years ago, I just decided to take a look at my trading statement. It had no big loss in a single trade since i was very very strict at following stop loss and 1% risk per trade rule. But still i was in net loss. What i found as the main culprit here was that the profits were also very small and mostly 1R or less than that. This is what i call as "PREMATURE EXIT SYNDROME". I call it as syndrome because it has no one point cause but many factors which plays.
I got cured from this permanently. The cure which i found has two parts. Realizing what we lack and developing lots of patience to overcome it.
Realizing is totally different from just knowing.I had read many books and watched many videos about successful trading. But unfortunately none of them improved my performance.But realizing this simple concept which KPL sir had posted regarding POSSIBLE OUTCOME OF ANY TRADE just brought that magical moment.
It simply says for any profitable outcome one must never ever allow BIG LOSS scenario. Small loss and small profits gets cancelled against each other in long run. What is left is BIG PROFIT scenario, which to attain requires lots of patience.
My previous trading statements portrayed exactly opposite of this. So i started to take small steps to overcome it. Took very small positions in commodity market and held on to it patiently. I told to myself that price should hit either my stop loss or minimum of 3-4 times of my risk and traded as many times as i can till i was comfortable holding onto it.(Please note that it was just an exercise to overcome my urge of booking profits with very small gains). At present i donot fix any R multiples for any trade.
So this is how i overcame from my inefficiency. I am sure there are many people who suffer like i did and this is just one honest attempt to share my experience in hoping that it will help someone.
My profit statement from the day i started to write this blog.
When i was making only losses few years ago, I just decided to take a look at my trading statement. It had no big loss in a single trade since i was very very strict at following stop loss and 1% risk per trade rule. But still i was in net loss. What i found as the main culprit here was that the profits were also very small and mostly 1R or less than that. This is what i call as "PREMATURE EXIT SYNDROME". I call it as syndrome because it has no one point cause but many factors which plays.
I got cured from this permanently. The cure which i found has two parts. Realizing what we lack and developing lots of patience to overcome it.
Realizing is totally different from just knowing.I had read many books and watched many videos about successful trading. But unfortunately none of them improved my performance.But realizing this simple concept which KPL sir had posted regarding POSSIBLE OUTCOME OF ANY TRADE just brought that magical moment.
It simply says for any profitable outcome one must never ever allow BIG LOSS scenario. Small loss and small profits gets cancelled against each other in long run. What is left is BIG PROFIT scenario, which to attain requires lots of patience.
My previous trading statements portrayed exactly opposite of this. So i started to take small steps to overcome it. Took very small positions in commodity market and held on to it patiently. I told to myself that price should hit either my stop loss or minimum of 3-4 times of my risk and traded as many times as i can till i was comfortable holding onto it.(Please note that it was just an exercise to overcome my urge of booking profits with very small gains). At present i donot fix any R multiples for any trade.
So this is how i overcame from my inefficiency. I am sure there are many people who suffer like i did and this is just one honest attempt to share my experience in hoping that it will help someone.
My profit statement from the day i started to write this blog.
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