Making mistakes in your trading is not cheap. Here are the ten most expensive things a trader can do. This does not apply only to new traders, even professionals with long track records can make these fatal flaws and cost themselves money.
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A big ego that wants to prove they are right by stubbornly staying with a position that is wrong becasue they want to be right eventually so bad.
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A trader that want to prove he is a hot shot by trading big position sizes especially in options or futures.
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Not wanting to take a stop loss and instead just hope the trade comes back.
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Trading with emotions instead of a trading plan can get very expensive very fast.
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Being a bear in a bull market.
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Being a bull in a bear market.
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Being overly eager to start trading with real money before fully testing out a trading system.
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Trading without doing adequate homework on how to win.
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Dollar cost averaging down in a trade is many time expensive to fight that trend.
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Ignoring the charts and just trading your opinion.
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Ignoring the probability of the risk of ruin based on your current position sizing.
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Not really understanding the true danger of ‘Black Swan’ and ‘Fat Tail’ events.