Revenge Trading

Revenge trading like all emotional trading is something that you need to avoid. It is simply when you say, “take my money, I’ll show you.”

The two big signs that you have been revenge trading are.

1. You say, “if only I win this trade I will make my money back” or

2. You say “I have go back in to recoup my losses”

I believe everyone has done this at 1 point or another. So how do you get around it? The biggest thing you can do to avoid it is to have a set of trading rules in place that you cannot break.

If you don’t have rules for when to buy and when to sell, make them, if you have rules follow them. There is no better way to trade unemotionally in the stock market.

Aside from that you can avoid trading with your emotions by

1. Creating a stop loss, if you limit the amount you can lose it will be easier to resist the urge to get back in to make up what you have lost.

2. Stick to your rules. Yes I’ve already said it and I’ll say it again it is important.

3. Don’t be in all the time. The more you watch the market the more stressed out you can become. Take a break every now and then.

4. Accept your losses. You will not be right all the time, and neither will the rest of us. Be happy that you are making money on average and don’t worry about getting out of losers.

5. Learn From Your Losses. In fact learn your mistakes. This will encourage you not to go back into the market in an emotional rage trying to make your money back, but take a step back and learn why you lost money. It will help you increase your performance and get stressed way less.

All of these are important to help you trade the market with a clear mind every time and not to help you fall into an emotional trap that can wipe out your trading account. If you can follow your rules (I told you I’d say it again) strictly you will be ahead of 90% of the traders out there.

I hope you enjoyed my page Now I want to hear from you.

Avoid Revenge Trading

How Do you help to avoid getting caught up in revenge trading? Any tips or experiences will be helpful.

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