Post
Topic
Board Trading Discussion
Re: How do you handle losses in trading?
by
Bright_dhykseen
on 05/06/2020, 13:32:52 UTC
Not a very bright idea if you ask me. While it makes perfect sense in gambling (otherwise known as "roll and run"), with trading you are typically in for the long haul. It means reinvesting almost everything earned to unleash the full potential of compounding. Indeed, you may and in fact must switch between assets by selling overpriced and buying undervalued ones (known as "portfolio reshuffle"), but other than that, it is a never-ending game of making dough

And another key difference from gambling

Taking my profit without looking back helps me avoid FOMO

Taking your profit and running away is not what trading is typically about

As I had explained in the post you quoted, most people are engaged in trading for the sole purpose of making a living out of it, for the long haul, that is. In this manner, they are kinda stuck in the sell-buy routine (as in buy low, sell high), and that means going back and forth between fear and greed as prices go up and down. To sum up, it is far from "taking my profit and never looking back"

You don't get my point.
Once my trade hits my target, I take my profit and move on according to my trading plan.

If I plan to take another trade, I take it also.

"Taking my profit and never looking back" simply means not letting the behaviour of the market after hitting your target affect you.

That's where greed sets in and traders make irrational entries/decision.