I was having a conversation with someone who was not in finance. Of course it went the direction that they believed trading to be gambling. After much explanation I finally got my point across.
The reasons I lose on a trade that I can control.
- I am not aware of a releases or speakers.
- Not maintaining my Trading Environment Equilibrium.
- Not following rules.
The reasons I lose on a trade that I cannot control.
- News happens.
- It is a new situation.
- Strategy is not working.
Those are really broad and over simplified. There are multiple levels to each of those bullet points. The reason why I have a bad day is because I lose money from not doing the things I can control and something I cannot control happens. Or in some cases I don’t need something I cannot control to happen because I am that bad.
If it was gambling I would not have the ability to improve. If it was gambling I would not have any control over an outcome. Don’t get me wrong some people are gamblers and from time to time I do gamble. When I do gamble I usually lose.
Why do you lose money?
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