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Remedy for big losses?


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Remedy for big losses?

  #1 (permalink)
fxSOL
Belgrade Serbia
 
Posts: 60 since Mar 2020
Thanks Given: 37
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Greetings to all warriors out there !

I have a problem (well I have many) but one big when it comes to money management. I can be the best trader in the world with insane record profits, but as often when times are good I increase positions and risk and doing all madness, which is a built in behaviour I can not get rid of since my days as a rookie trader.
Don't know if its a greed issue or just bad behaviour or both?

This results in unnecessary big losses making it hard to hit profit target each year. And adding to this I have lost a screw or two in brain when it comes to big loses - I just become emotionless caring little that I lost just 20K which is real madness.

And I always repeat same bad behaviour when it comes to big losers - I keep holding positions because I KNOW I AM RIGHT, and when the losses are to big I have troubles closing because brain say "you are right".

Anyone with a remedy for this bad behaviour or a strategy for this?
Think I am not alone doing this but I can not figure out what is the best way to get rid of this bad behaviour.

Cheers to all

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  #2 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
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fxSOL View Post
Greetings to all warriors out there !

I have a problem (well I have many) but one big when it comes to money management. I can be the best trader in the world with insane record profits, but as often when times are good I increase positions and risk and doing all madness, which is a built in behaviour I can not get rid of since my days as a rookie trader.
Don't know if its a greed issue or just bad behaviour or both?

This results in unnecessary big losses making it hard to hit profit target each year. And adding to this I have lost a screw or two in brain when it comes to big loses - I just become emotionless caring little that I lost just 20K which is real madness.

And I always repeat same bad behaviour when it comes to big losers - I keep holding positions because I KNOW I AM RIGHT, and when the losses are to big I have troubles closing because brain say "you are right".

Anyone with a remedy for this bad behaviour or a strategy for this?
Think I am not alone doing this but I can not figure out what is the best way to get rid of this bad behaviour.

Cheers to all

Sorry to hear that, loses is a really uncomfortable side in trading. Like many professional traders, you need a head trader, or if you want, you can call him a "Boss". Why? Because it will take you years and a tremendous effort to control this behavior. There are many options you can do, like ask your broker to put you a daily limit loss, or like NinjaTrader has, few options to block some emotional behaviors. There are a few add-ons, if you are using NinjaTrader, that can help you in that also, management risk tools.

Another option is going to a professional trading psychologist and trying to find your relationship with money and why you are auto-sabotaging yourself. It is not an easy task but is very typical. If you see money trading, and this is probably what you are doing now, this will destroy your dreams, because losses are against them. What I think about your behavior is that money for you is a drug. Don't take it wrong. If you get profit, you want more, and more, hard to stop, because your mind likes to get money. If all goes well, is also a problem, because you want to continue trading, because if you have 1k, wait...2k is better. A never ends history. Limit your time. Limit your losses and your wins. Have every day a plan, related to wins and losses. Don't work with surprises, be prepared.

One thing I do is every day I know in advance how much will lose in my trading plan and how much will win. No surprises. I trade supply and demand zones, and this helps me to know in advance in which areas I will work the risk and the profit. No surprises. The worst you can do is get surprised with something in your trading. Your subconscious mind will kill you, for sure.

Sorry if something sounds hard, is not the intention, really feel your skin and hope you find some value in this little advice.

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  #3 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
Thanks Given: 883
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Here is a little example of a trading plan. Planned losses: -304$ Planned wins: +1108$
I can move around those levels, but there are no surprises in my trading


2023-04-03_19h00_36

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  #4 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
Thanks Given: 883
Thanks Received: 346

Here you can see a trade example. The important thing is not the result, more than I know in advance exactly the expectation and agree with it, no room for getting more or fear to get less, only the trade and running it alone. Manage risk If I see the price action is not too much in line, but nothing more.


2023-04-03_19h10_24


2023-04-03_19h11_04

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  #5 (permalink)
fxSOL
Belgrade Serbia
 
Posts: 60 since Mar 2020
Thanks Given: 37
Thanks Received: 25


ignacio90 View Post
Sorry to hear that, loses is a really uncomfortable side in trading. Like many professional traders, you need a head trader, or if you want, you can call him a "Boss". Why? Because it will take you years and a tremendous effort to control this behavior. There are many options you can do, like ask your broker to put you a daily limit loss, or like NinjaTrader has, few options to block some emotional behaviors. There are a few add-ons, if you are using NinjaTrader, that can help you in that also, management risk tools.

Another option is going to a professional trading psychologist and trying to find your relationship with money and why you are auto-sabotaging yourself. It is not an easy task but is very typical. If you see money trading, and this is probably what you are doing now, this will destroy your dreams, because losses are against them. What I think about your behavior is that money for you is a drug. Don't take it wrong. If you get profit, you want more, and more, hard to stop, because your mind likes to get money. If all goes well, is also a problem, because you want to continue trading, because if you have 1k, wait...2k is better. A never ends history. Limit your time. Limit your losses and your wins. Have every day a plan, related to wins and losses. Don't work with surprises, be prepared.

One thing I do is every day I know in advance how much will lose in my trading plan and how much will win. No surprises. I trade supply and demand zones, and this helps me to know in advance in which areas I will work the risk and the profit. No surprises. The worst you can do is get surprised with something in your trading. Your subconscious mind will kill you, for sure.

Sorry if something sounds hard, is not the intention, really feel your skin and hope you find some value in this little advice.

You are right on everything you have written for sure and no it does not sound hard =) I am just trying to fix bad issues and get rid of the bad and I had a reality check with myself a few days ago. I know my weaknesses and what I am good at, but its the weaknesses that is the hardest to fix. Auto-sabotage indeed - spot on!
All because stupidity and games of the mind. I use RRR but since my ego is bigger than my head the SL is tampered with when I know I am right =) BAD and stupid behaviour!
I also use Supply And Demand =)

Thanks for input m8!

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  #6 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
Thanks Given: 883
Thanks Received: 346

Let me talk to you about something that can be a factor in your issue. Let's say, how do you feel when you take your first trade? the first one in the day? Which is your emotional state, and your thoughts? How do you feel? You will probably be more neutral than others states. You have been out of trading for hours, enough to delete your stories. There are no results, that can build your story, let's say I'm close to my objective or I'm far...or I lost the last 3 trades, I was happy with my 3k and now I'm down 2k...If you continue trading, you start to be your own story. You are trapped for your results, and now you are trading your wins and your losses, nothing more. Money is in your head in every trade you will take, probably ruining your day or your account. Nothing bad, btw your head is doing what you want, money...

Cut the story...go out of your "money Extasis". Basically, you showed your mind your potential wins and this is what he wants. Give you space between trades and cut stories.

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  #7 (permalink)
 
blackgrey45's Avatar
 blackgrey45 
Marco Island, FL
Legendary Market Wizard
 
Experience: Beginner
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Yes I have problems with large losses as well. I would have a plan before getting into a trade. I would execute a trade to enter a position and tell myself "okay, I am getting out 10 ticks lower if it goes down". The market would go down 10 ticks in the blink of an eye and I would think "wow, I did not get enough excitement from that trade, so I am staying in it". Then the price would go 10 ticks lower in the next 30 seconds and I would have the same thoughts. Before I know it the price is 40 ticks against me and I would still be holding the loser. My solution is just implement shear will power and a broker enforced daily loss limit if I can't get out on my own. Good luck with your trading! Thanks,
-Blackgrey45

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  #8 (permalink)
fxSOL
Belgrade Serbia
 
Posts: 60 since Mar 2020
Thanks Given: 37
Thanks Received: 25


blackgrey45 View Post
Yes I have problems with large losses as well. I would have a plan before getting into a trade. I would execute a trade to enter a position and tell myself "okay, I am getting out 10 ticks lower if it goes down". The market would go down 10 ticks in the blink of an eye and I would think "wow, I did not get enough excitement from that trade, so I am staying in it". Then the price would go 10 ticks lower in the next 30 seconds and I would have the same thoughts. Before I know it the price is 40 ticks against me and I would still be holding the loser. My solution is just implement shear will power and a broker enforced daily loss limit if I can't get out on my own. Good luck with your trading! Thanks,
-Blackgrey45

This was exactly what I did on my last trade today. Was 100% accurate during the whole day. +6K and then the last one I messed up by moving the SL...and kept moving until almost all profits of today was gone.
So what is the point being best in class and then be the little fool at the end of day?
Nah will sit down now and do some calculations and thinking because this is not good what I am doing.


::EDIT::

Think move away from terminal for a while can be good to avoid trigger happiness and emotions. Just walk away can do the trick and if SL hit - FINE but at least it was a calculated loss based on numbers and not emotions.

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  #9 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
Thanks Given: 883
Thanks Received: 346


fxSOL View Post
This was exactly what I did on my last trade today. Was 100% accurate during the whole day. +6K and then the last one I messed up by moving the SL...and kept moving until almost all profits of today was gone.
So what is the point being best in class and then be the little fool at the end of day?
Nah will sit down now and do some calculations and thinking because this is not good what I am doing.


::EDIT::

Think move away from terminal for a while can be good to avoid trigger happiness and emotions. Just walk away can do the trick and if SL hit - FINE but at least it was a calculated loss based on numbers and not emotions.

Hi, I'm sorry to hear that again. Don't vaste your time thinking. You know what you need to do. This is not the problem. The problem is you are not able to do it. Easy and fast solution, take a boss. Broker (limit daily loss...) or use a risk management tool. Much more than less People, need enforcement to do things. Called boss or coach, like you prefer, but every elite player has one.

Other solution. You have a problem with money. Every time you get money, you like it. Losing money is a pain in your mind. Every time you are wining you are fixing the quantity in your mind. If in a loser trade (open or closed) you are closely to the fix it quantity your mind begin to be in "alert state", but you will try to recoup this loss. If you recover the loss, no problem. You will do the same, mind quiet, happy and you will continuing trading. If you are far away from it, the disaster is coming. You will not stop till goes again at the same level or more, and of course with one trade. Doesn't matter if you win 200$, is far away from your fix it quantity, your mind don't like 200$, your mind like 6k. Spend 5 minutes before every trade, to convince your mind about trading and money. Speaking with her about your relation, how do you feel, wich is the pain in the next trade. Where is the extasis. Be mentally aware about it. Before every trade, see mentally your loss. Close your eyes and take the trade. Force your mental process to be focused in warning your conscious mind about anything can happens. Use your imagination to train your mind. See you in advance doing something, being calm taking a loss, stoping if you go down "x" dollars, closing your trading day, desktop. Do it regulary and you will fix it. Convince your mind about what you know. Put emotions is what you know and you will change your believes. Your problem is only believes, actually they are wrong.

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  #10 (permalink)
 
Kaimu's Avatar
 Kaimu 
Madrid - Spain
 
Experience: Advanced
Platform: Ninja
Trading: ES,NQ
Posts: 315 since Mar 2012
Thanks Given: 883
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Remember, money is a relation. You need to build this relation. If you never trained it is time to start. Try to run a marathon without training. About money is probably that your mind will get the moon, limits in trading are not there. A relation without limits is dead. Train your mind to understand limits, to accept them and grow your relationship with money.

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