Your Worst Trading Enemy.. You Message Board

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Strategies & Market Trends : Your Worst Trading Enemy.. You

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To: Northspoon who wrote (210)	2/7/2001 4:33:35 AM
From: shawnwolff	Read Replies (1) of 223

Re: In The Aftermath of a Large Loss I see a few common pit-falls that people fall into after a large loss. One is a "deer in the headlights syndrome" where they become so gripped with fear of that happening again that they can't seem to enter a trade at all. Another is a "revenge syndrome" where they go on a mission to get their money back asap. The problem with this is that they wind up taking unusual risk. Large fast gains are usually accompanied with large risk. I understand wanting the money back, but I see that syndrome too often lead to a snowballing of the losses. In my opinion(and that's all it is), it is much better to take a little reflection time and figure out first how and why you took that loss. If you don't know why you are losing, those losing patterns are not going to change by continuing on the same path. Then take small cautious steps to rebuilding. You aren't simply rebuilding your portfolio, you are rebuilding your confidence, your skills, your strategies and habits. And that rebuilding can be a wonderful experience and serve for a lifetime of trading to come. The turtle won the race. - Shawn

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