Letting losing trades ride as bets

SportingX Staff - 14 Aug 2009

To be a successful trader you must be taking profits and losses of roughly the same size, but having more profits than losses, the scratch trade taking the place of the losses.
 
As soon as you start to let your losses get bigger than your profits you're creating an uphill battle for yourself because then you have to have lots more profits than losses just to break even.

The absolute worst thing you can do is hold on to a trade because it went against you and let it ride as the race runs. Risking your whole bank because you couldn't accept a small one or two tick loss is stupid. This is gambling at its worst. If you want to gamble then gamble but at least do it properly. Don't do a hybrid mix of trading and gambling where you're doing each one badly. You know that in the long run it's going to end in tears so why do it?

There's no point in winning nine times and losing once if your loss is 50 times the size of your profit. Anyone with such a complete lack of discipline not only will lose but deserves to lose.



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