Are you Victim of “Out of Control Trading”

By | February 19, 2013 3:21 pm

Patience is a virtue which many talk about but few have

The most common trait of successful and profitable trader, they are patient and wait for right trading opportunity as per their trading system. Many amateur trading never reach the professional level because they “Over Trade” . Most of newbie traders fell more they trade more money they will make which is grossly incorrect statement. Trading is all about probabilities and its also a negative sum game so more you trade more will be probability of losing money not gaining.



Below we have discussed few ways which will help you to diagnose, if you are victim of Out of Control Trading:

1) Over trading:  This is a very common problem for an out of control trader. Over trading can happen when you are  trading with more open positions than you can  handle at a particular point of time and second is the risking of most of the capital on a single trade (bad position sizing).

2)  Trading for adrenaline rush: Many traders look for action, they trades because they cannot resist themselves seeing the trading screen.Most of trades are based on hunches and have no statical edge.The more trades they do the better they feel. Behavioral psychologists refer to this as compulsive behavior and it’s a serious weakness in any profession or activity.

3) Comfort in bigger losses:  When I hear a trader feeling comfortable about larger than usual losses that scares me.  This comfort tells me that the trader is not thinking rationally as losses should never be tolerated and especially outsized losses.

4) Trading new securities:  If a trader deviates at all from the strategy that made him successful, especially when he is a down streak, this concerns me.

5) One sided trading:  This sign is correlated to having an opinion on the market.  If I see a trader constantly focused on one side, regardless of what the broad market is doing, this person is so focused on being right that nothing else matters.  It is so important to be right that even if they make up 20% of what they lost it will seem like a victory to them.


Fact of matter is Out of Control Trader have existed and will exist till the markets are present.  There traders feeds the successful traders. So get you act together and try to control the urge to trade without any confirmation from trading system.


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