Why Traders Fail (WTF) Series... My personal thoughts & experience!

I hope this can be made a sticky if worthy... Just some advise to those starting out to avoid doing these mistakes...

1) We do not have discipline, we create a plan to trade, that's good. But:
1.1) Keeping to the plan after entering the trade is quite a challenge, the longer you are in the trade, the more prone you are changing your initial plan.
1.2) Keeping to the same plan over and over again is also difficult. If you have executed Plan A over and over again, closing trade after trade in profit or in loss, you will get tired of it over the long run. You will suddenly trade Plan X and Y and that is when you lose all your money.

2) Over-leveraging:
2.1) We might over-leverage because of mindset. We have a mindset of getting rich quick, we really want to turn $100 to $1000 overnight, we really believe we can do it so when trade turns against us, we quickly lose our money.
2.2) We might over-leverage because of revenge, we lost trades over and over again, so we need to re-gain all that losses, so we risk more to gain more, and again, when our trade goes against us, we lose our money faster than expected.

3) Instant gratification:
If we are always right in trading, we might not have this problem, but the thing about trading, you can never be 100% correct, so you are bound to have losing trades. When you have too much of losses, you want to just be right at least once or a bit. So when our trades gets a little bit into profit, we will close it. As such, the profit will be a little bit. We do not do the same with losing trades, we try to wait it out, hoping that price will come back, or giving the trade "some room" before it will move in your direction. Over time, the losses will overcome the tiny profits and we will again lose our money.

4) Impatient:
It is good to trade according to what we see but we need to have a confirmation. Sometimes we see a seemingly obvious and outrageously big down candle and we jump in a SELL trade, we did not wait for any sort of confirmation like candle close. As such when we enter we are caught at the extreme low point and before the candle closes, it reverse and creates a obvious and outrageously big UP candle. We know we are doomed. We never expected nor could imagine it can ever be a UP candle, our eyes and impatience deceived us.

... more to come ...


Private, 1st Class
Too many people see some positive things in their trading accounts and assume whole wolrd will be now for them in that matter absolutely and possibly. I do not want to know what is what clearly and possibly anyway for many many reasons.


I agree with most of the reasons why traders fail. It's true that most of us don't have discipline, I know that some of us make a public journal where we record all our activities to become more disciplined in this way. Over-leveraging is also one of the problems, as we can take great risks and lose big sums in a moment. In fact, I'm not sure I agree on the point about instant gratification, so I won't talk about it. And as for impatient, I agree 100%. Many of us can't just wait for a successful deal closing. Thank you for your opinion, I liked what you wrote there :)