Trapped in to taking a bad trade.

I said I have never taken a bad trade. That post sparked a few conversations and the best imagery I can come up with is an animal trap. (excuse the photoshop)

Every trader puts themselves in a bad position at some point.  This position makes the reward look great no matter the risk.  Or they do not see the risk at all.  Easier said than done, but each trade should be taken independently of the previous one(s).

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  • Cyrus

    yeah well put dude. just fuckin’ did this today. managed to scratch (like your other post too hey. heh) at a small loss. Small price to pay for stupidity. 

    I’d say bet sizing matters alot in psychology and ability to “sit tight” too. 

    • The market has a way of reminding us where we are psychologically.

  • I think any trade that ignores downside potential is a bad one. Stop losses are so pivotal. If you go into a trade discounting the risk of loss because you feel it’s a guarantee – inevitably you’ll lose – Murphy’s law right?

    Should be an informed trader and that is why you should join Shmish.com (wink wink). A social news site that I started for finance. You can make sure your up to date on the latest and share news you believe to be relevant to help others.  

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5 Responses to Trapped in to taking a bad trade.

  1. Cyrus says:

    yeah well put dude. just fuckin’ did this today. managed to scratch (like your other post too hey. heh) at a small loss. Small price to pay for stupidity. 

    I’d say bet sizing matters alot in psychology and ability to “sit tight” too. 

  2. I think any trade that ignores downside potential is a bad one. Stop losses are so pivotal. If you go into a trade discounting the risk of loss because you feel it’s a guarantee – inevitably you’ll lose – Murphy’s law right?

    Should be an informed trader and that is why you should join Shmish.com (wink wink). A social news site that I started for finance. You can make sure your up to date on the latest and share news you believe to be relevant to help others.  

  3. […] equal. There are good risks and bad risks. There are risks that you want to take and risks that you are forced to take.  There is risk of not taking risk. The way you feel about risk is partially determined by when […]

  4. […] Bad risks do not just happen.  There is always something that leads to you believing that it is a good risk.  It could be that you have not prepared properly, that you have gotten away with that behavior previously, or there is something else going on with you that is more important than trading. […]

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