You Can't Go Broke Making A Profit

Well I can tell you for sure that you can...

And one of the biggest challenges traders face, but don’t always realise, is being able to hold onto trades.

And simply not bailing on a trade too soon!

Most new and aspiring traders get the importance of this, however holding a position for a day, a week or much longer, isn’t always an easy thing to do…

The ability to hold a trade ISN'T something most traders are simply born with.

And as a trading coach, this is an area so many traders fall short on - trade after trade!

And how do I know this?

Well at my workshops I often ask the group...

“How many of you had a clear target on a recent trade, and DESPITE this you  chose to cut the trade short?"

And plenty there DO admit to doing this.

Then it gets WORSE, as I then ask...

"How many of you ACTUALLY felt good about it in the moment, and felt a sense of relief?"

And again, the honest ones amongst the group admit to feeling that feeling.

Now you might be thinking...

"It's only a couple of points Ali and you can't go broke banking a profit"

You see the two major problems with this are...

1. Yes you can go broke banking too smaller profits as then very often your losers are way bigger as a ratio.

2. You are CULTIVATING the wrong behaviour if you feel any positive feeling after breaking your rules.

Now you might ALSO be thinking....

"You just need to be more disciplined"

Well as I say to all the traders I work with....

No trader ever wakes up and says...

"My goal today is to BREAK my rules and get out of my trades early!"

But the longer a trade is in profit, the more a traders expectations along with their wants and desires get amplified.
So how do you get better at holding trades for longer?

1. Awareness. Be clear and honest with yourself that this is something you do.

2. Tracking. Log when and how much you are getting out of trades too soon. Very often it's more than you think!

3. Accountability. Work with other traders who are hyper disciplined and have mastered the attribute of patience.

So many of traders I work closely with, say to me that despite their technical skill level they have acquired.

"If it wasn't for the fact that I KNEW you and other traders in the group were sticking with that trade, I know I would have bailed on it early."

4. Start Small. Get consistent with clear and proven smaller reward to risk trades.

Now I am NOT talking about taking trades for 1:1 or less, but so many traders, despite their lack of current trade discipline.

Get all excited about the thought of running very high reward trades,

But brush over the accompanying lower win loss ratios.

So don't let hindsight bias on a few trades blasting past your target, be the reason to then start trying to hit massive winners.

If you cultivate patience consistently, it just becomes the norm and regardless of the trades duration it's then never an issue.

Then you are ahead of 80% of traders out there!

Until next time

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