Losses are part of trading

Pelvell

Private
Messages
39
But can't losses lead to a lack of absence of money??
Definetely losses can lead to the abscence of money, however we shouldn't forget such fundamental things in trading as money and risk managements. In the very beginning of your trading path you have to master these two things, otherwise you will leak your deposit. I tend to suppose that every novice would better use demo account for a couple of months before trading, and what is more important is that he/she has to trade on demo the same amount of money which he/she consider to trade on a real account. It will prepare them for everything including money losing and can also prevent other serious mistakes.
 

Anakelv

Private
Messages
35
I tend to suppose that losses is a real part of trading, because even professional traders from time to time lose a particular part of their deposit. You know that sometimes it's almost impossible to foresee the market movement even if you're a professional with lots of experience, even if you're checking news, there are some situations which depend on nothing. What is more important is that you have to adjust yourself that losses sometimes can be even good, just because they bring you experience and make you to think twice before open a position. Remember that there is no success without losses.
 

Gholis

Recruit
Messages
41
So true, you have to have losses in order to be able to learn. Also, if the market was perfect to read then everyone would be doing it. There's only so much analysis you can do, you will always have some losses. The important thing is to work with a stop loss and keep a tight risk management strategy.
Absolutely. I personally think that losses make traders stronger, not only beginners but professionals too. Professional traders sometimes face losses and it's okey mainly because it's an inevitable part of trading activity, you know. Hence the main thing novices have to learn is emotions control and ability to take losses for granted. It teaches them how to turn off the emotional component of their organism while trading and concentrate all the energy only on it. I wish all traders mastered these techniques in order to prevent further losses. Moreover, I'd recommend novices take a break after a string of losses, take a day-off and then dedicate some time to analyze of the mistakes on demo.
 

Keithstyles1

Private
Messages
143
I think no matter how good you are as a trader, you will not always get every trade right and you will face a trading loss every so often. In my opinion that is perfectly normal and part of trading and risk management prevents that loss from having a big impact on your overall portfolio.

No trader likes to record a loss, at least I never met a happy loser. I did come across an article on the Paxforex blog which made me think about it (Losses As Inevitable Part of Forex Trading). I guess everyone has a different measure for success and failure, so I was wondering what you classify as a good strategy for yourself? Do you look at how much money you generate, the percentage of your trades you got right, etc.?

I ultimately measure it by how much money I have earned and if the returns are consistent.
Win some loose some part of trading
 

bigdolly

2nd Lieutenant
Messages
1,194
Yes, losses are a part and parcel of trading. None can skip this part, especially in the starting months. Losing is what makes us more known to our mistakes and we get an idea of where we are exactly going wrong. So instead of cribbing over losses and becoming demotivated, we all should learn from our mistakes and try to become better.
 

Michael Daecher

Recruit
Messages
3
There is no trader who doesn't have any losses. We should understand that the market is unpredictable and the prices can move in any direction in spite of our expectations. That is why we have to follow money and risk management principles in order to secure our deposits from serious losses.
 

HeavenLeighRob

Corporal
Messages
116
I think a big goal for beginners would be to make more than you lose, even if your gains aren't a lot at first. Everyone is going to lose at times, it's totally normal. The best traders can manage their emotions at those times and learn from their mistakes.
 

sebking1986

Recruit
Messages
369
The thing that many find hard to wrap their heads around is you can have a trade that is excellent in it's setup and execution that still loses. It's just part and parcel of the process. But these are focussed on far more than the bad trades that ended up winning as we are predisposed as humans to experience loss aversion.
 
Messages
155
There is no trader who doesn't have any losses. We should understand that the market is unpredictable and the prices can move in any direction in spite of our expectations. That is why we have to follow money and risk management principles in order to secure our deposits from serious losses.
This is a good way to look at it. We can't avoid losses, but there is a lot that we can do to make sure we don't lose too much.
 

Enayess

Recruit
Messages
119
Trading is definetely not for perfectionists.
Every trader has some losses and there is no way to avoid them completely, Even if you know the markets perfectly well, they will always give you 'surprises' from time to time. I believe that it is very importnt for everyone to realise that the markets are unpredictable. That is why the data scientists haven't come up with the algorithm which would predict all the price movements with high percent of success. However, many traders have a kind of perfectionalism in their personality and wjen they observe the deal to be red, they are ready to wait until it becomes positive. That is one of the biggest mistakes made by the traders who cannot control their emotions. Surely, everyone wants their trade history to be all in green, but it is a wild goose chase and you'd better to be more down-to-earth. Trading is for realists and if you want to make any consistent and decent profits, you've got to accept the markets the way they are, otherwise you'll be punished by the incredible losses.
 
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