The Best Loser is the Long Term Winner
There is an old saying, “The best loser is the long term winner“.
I completely agree.
Professional traders have the ability to cope with losses and deal with periods of equity decline whilst amateur traders don’t.
Amateurs believe professional traders rarely have losses. This is not the case. Professional traders simply know how to minimise losses.
Cut your losses and let your profits run.
The Best Loser
I get asked a lot about dealing with losses. If traders made money all the time, everyone would do it. So we must get into the right mindset; the mindset of the professional trader.
My mantra is “Next 1000 trades”. When I have a loss, I…
- Acknowledge the loss and record it in my trading diary (my ‘diary’ is a spreadsheet called Share Trade Tracker that our members get free access to.)
- Ensure I followed the strategy and took my exit signals. That is, ensure I didn’t override the system.
- Take the next signal, place the trade and move on.
Avoid Attachment to Money
There’s another well-known saying, “Only trade with money you can afford to lose“.
I agree with this statement as well, yet it’s often misunderstood. It’s taken literally when it shouldn’t be.
It’s not about losing money, rather about not being emotionally attached to the money.
When you become detached from the money you’re more likely to follow the trading process, follow your trading plan.
A funny thing happens when you follow your trading plan. You tend to make money.
So…will you become the best loser?
