Quitters Sometimes Win and Winners Know When to Quit

11 Nov
November 11, 2012

 

 

 
 

 

“It’s not the daily increase but daily decrease. Hack away at the unessential.” -Bruce Lee

Quitting is not always the wrong thing to do. There is a time when you have to decide what you want and go get it, you do not stop your journey to your destination but there are times to stop if you hit a dead end or you are heading in the wrong direction. People that eventually win learn to know the difference. There is a time to press through temporary pain to achieve long term success and a time to quit wasting your time with diminishing returns.

Sometimes a marriage can not be saved through counseling it is just not going to work for many reasons. Sometimes a restaurant owner has worked 70 hour weeks for three years for the privilege of losing money and in debt six figures and still no improvement, they are better to go get a job and at least get paid. No matter how much Ford believed in the Edsel or the federal government believes in the Chevrolet Volt it is making a mistake by continuing to produce them.

Cutting losses short is smart in all areas of life because it frees up resources to be used more wisely whether it is time, money, or energy.

Here are ten things that traders should stop doing where perseverance is the wrong thing to do.

  1. Quit letting trades go through your original stop loss, you were wrong, get out. When you start hoping and stop managing your stops you are losing money.

  2. Quit over trading, only take the very best entries and trade the very best stocks in your system.

  3. Quit making up stories about why you decided to hold your position instead of taking your stop when it was hit. trade your plan.

  4. Stop trading your opinions and start trading what the price action is saying.

  5. Stop following people in social media that cause you to trade badly and lose money.

  6. Stop looking at CNBC for trading and investing advice.

  7. Stop trading so big that you emotions are more involved in your trades than your mind.

  8. Disconnect your ego from your trading. You determine your risk size and entry the market chooses whether you win or lose.

  9. Quit riding an emotional roller coaster, your emotions should stay level when winning and losing. If not trade smaller.

  10. Quit buying falling knives and shorting rocket stocks, wait for confirmation and reversal before entering.

Sometimes in life what you stop is more important than what you start.


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