Top Ten Ways to Lose Money by: Kerry

Everyone has a Top Ten….. Here is top ten ways to lose money trading. Add some additional ways if you like.

1. No Specific Trade Plan or System, trading impulsively.
2. Trading a New System/Strategy without knowing its expectancy. Do not back test or forward test, trading on blind faith.
3. Un-realistic expectations, looking for get rich quick systems and searching for the Holy Grail. Looking to trade for the wrong reasons.
4. Trading too large a size for the account. (#3 feeds #4)
5. Making too many trades for the account size. Trading is boring many times and most people want to be entertained.
6. Trading on hope rather than accepting the markets actions. The market will do whatever it is going to do, regardless of your thoughts, hopes, and dreams.
7. Un-willingness to accept a small loss. All large losses begin as a small loss.
8. Letting winners turn into losers. Only believers in Buy and Hold strategy should never sell. A profit cannot be taken unless you are willing to potentially leave some money on the table.
9. Un-willing to scratch a trade when the trade is not working as planned, the trader switches to #6.
10. Not reviewing past performance and learn from mistakes. Do not expect different results if you keep doing the same mistakes over and over. Keep doing what you are doing and you will most likely keep getting what you are getting.