I'm losing money, when do I call it quits???
Successful daytrading is very difficult. The vast majority of those that try daytrading end up losing money. However, the few successful daytraders make huge sums of money once they gain the knowledge and experience to be successful.
During the inevitable 'learning curve' virtually all traders lose money. The tough decision is when to 'pull the plug' and give up daytrading if you are not successful. The following ideas may be worth considering:
1) Are you financially secure enough to trade without the anxiety of needing a 'paycheck' at the end of every day?
2) Does daytrading still interest you? Do you look forward to the open of the market every day? In short, do you enjoy trading. If not, you are likely not committed to the extent that is required. Most people cannot excel at something they don't enjoy. The most successful people are virtually immersed in their fields
3) Is your trading improving? If you have made several hundred trades, you should be seeing some improvement in your trading results. Keep detailed records of your trades in a spreadsheet. This will give you irrefutable data that shows your results in black and white. Don't argue with the facts.
4) In addition to the statistical data, do you feel you are avoiding many of the dumb mistakes that you made when you first began trading?
5) Are you trying to trade with some kind of plan, or are you just trading from the seat of your pants? Hopefully, after several weeks or months of trading, you are beginning to formulate some ideas on a personal trading strategy to guide your trading. Even if not successful with a particular strategy, you will gain knowledge by learning that the strategy was not successful. Then you can modify or refine your system to improve performance. If you trade by the seat of your pants, you have no reference point to what you were doing that was unsuccessful.
The decision to quit trading is a very difficult one. Over 90% of daytraders wish they had made this decision sooner. Do not let your ego prevent you from giving up trading. The odds are stacked extremely heavily against successful. People who lose money are in very good company. Not being a successful daytrader should be nothing to cause embarrassment or to be ashamed of.
It the end, it is a personal decision of when to stop daytrading if you cannot find success. I think an individual needs to very honestly review their situation and make their best decision. Note: Don't decide during market hours! |
