If you were a doctor and in 50% of the cases you got diagnosis and treatment wrong , you are unlikely to survive the profession. If you were a architect and 50% of your buildings fell down , you would be a total failure. If you were a software developer and 50% of your software was as disastrous as the Obamacare software launch , your software company would not survive. If you were fixing cars and 50% of them broke down immediately after your fixed them you will need to close shop.
Most profession have very low failure rate in their decision making . In trading chances of you proven wrong are very high. That makes the profession difficult for people being used to being always right. Trading is a humbling experience , you can be proven wrong inspite of all your analysis and backtests and years of experience.
Good traders have learned very important thing , you will be wrong often in this business. They learn to live with it . They learn to quickly cut losses when they realise they are wrong . As against that struggling traders often have not come to appreciate the fact that it is best to acknowledge quickly when you are wrong and move on. They hold on to losing trades longer , they add to losing trades.
The harder part of trading is when you are wrong 8 times in a row and get stopped out and you still need to put in the 9th trade which might work and recover the losses from those 8 trades. these are some of the unique challenges of trading and as you prosper and survive in this business you learn to manage your own emotions to face these challenges.
Trading makes you humble as you learn to accept limitations of your own decision making and learn to live with 50% or less of your trades working . That is big challenge for many who are used to be always right. they don't survive the game long.
Most profession have very low failure rate in their decision making . In trading chances of you proven wrong are very high. That makes the profession difficult for people being used to being always right. Trading is a humbling experience , you can be proven wrong inspite of all your analysis and backtests and years of experience.
Good traders have learned very important thing , you will be wrong often in this business. They learn to live with it . They learn to quickly cut losses when they realise they are wrong . As against that struggling traders often have not come to appreciate the fact that it is best to acknowledge quickly when you are wrong and move on. They hold on to losing trades longer , they add to losing trades.
The harder part of trading is when you are wrong 8 times in a row and get stopped out and you still need to put in the 9th trade which might work and recover the losses from those 8 trades. these are some of the unique challenges of trading and as you prosper and survive in this business you learn to manage your own emotions to face these challenges.
Trading makes you humble as you learn to accept limitations of your own decision making and learn to live with 50% or less of your trades working . That is big challenge for many who are used to be always right. they don't survive the game long.
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