At the start of our trading journey, it is a very common problem that newer traders use too much leverage.
They are excited, they are new, they don’t know what they don’t know, and they just want to make a lot of money. They want the kind of returns people with 5, 10, 15 years of experience are making – and they want it TODAY!
So they trade big, and inevitably run into a bad trade…. Often just one single one… and lose a large part of their trading account.
They are shocked! They are stunned – they become fearful, and become paralyzed by risk. Then immediately cut down their trading size to the lowest amount possible.
But the returns are now SO SMALL – that it will take them 50 years to earn back their one trade loss.
This really crushes your confidence.
So today I want to discuss a few scenarios that could indicate you’re trading too small:
- You are moving your stops to increase risk when a trade goes against you
- You are moving your take profit orders when price gets close to them
- You get into a trade expecting to lose, to get your stop hit
- Your winners are small, but your losses are huge
- You are trading money you cannot afford to learn with
- You turn a day trade into a warren Buffet investment
These are the 6 signs we go deeper into, and explain how each one may be impacting your trading and what you can learn from it.
I hope you enjoy the show.
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