Friday, June 21

Are you Victim of Greed and Fear in trading?

Greed is one of the main contributors to trading loss. Greed mangles the mind by distracting the trader from what matters most in the trade, which is quite frankly to protect your capital by prudent planning and following rules. Once a trader starts doing profitable trades, overconfidence creeps in and trader wants more and more profits. Go back in past and try to remember how many times have you lost a big chunk of your profits because you got greedy and did not slicked to your trading plan.
Greed can arguably be thought of as a fear of not having “enough.”
Fear is again a major contributor of reducing your profits. Again try to remember trades where you have exited early thinking its cannot go up more and stock just kept on going up.
Now, the question is what do you do about those bouts with fear/greed emotions that takes your trading effectiveness and lead to major losses?  The important thing of course,

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