WHAT ARE THE MAIN EMOTIONS WE FACE WHEN TRADING?
1- FEAR: “The mortal enemies of the speculator are: ignorance, greed, fear and hope. (Jesse Lauriston Livermore) "
-Do not open a position out of fear: it is a common mistake in trading, and it is something that we have to learn to eliminate from our operations. When we sit in front of the screen to carry out our operations we have to put aside all our emotions and focus on what is really important.
Therefore we have to learn to overcome that fear that hurts us daily in our operations.
Fear is something that is not lost, it is an emotion that accompanies us all our lives, but what we can achieve is to replace that feeling with another, such as security.
How can we overcome fear?
In order to overcome fear, apart from working on it every day, we have to have very clear rules of our operations (when to buy, when to sell, what securities to buy, where to invest, etc.)
It is important to be properly trained, to be able to understand everything that happens in the market, to be able to understand why market movements happen, it will make us gain a lot of confidence in ourselves and will reduce our fear of not understanding why this action / index / pair of currency has moved like this.
It is very important to have a trading plan, and to follow it without breaking any rules.
Trust yourself:
The fear of losing can be counterproductive, causing more losses; And it comes from a lack of confidence in your own abilities.
If you constantly prepare, have a well-defined strategy and master market sentiment: it is time to trust yourself more.
Practice a lot:
Practice makes perfect, and the more you practice, your fear will gradually disappear.
The more operations you have in your career as a trader, the more you will learn to accept that it is inevitable to lose money in this career. The market is a fluctuating environment, any operation can go wrong, due to factors beyond your control. Don't let this discourage you, proper risk management and practice will help you overcome this fear and cope with it.
When you no longer sweat or your emotions make the decisions for you when you are in front of the monitor, you will know that you are on the right path
2- GREED: "Greed is of such an evil and perverse nature that it never satisfies its voracious appetite, and after eating it is hungrier than before (Dante Alighieri" *
Greed is a very important emotion in trading, but it is a very dangerous emotion. Most of the people when starting in this sector want to earn more and more money, with minimal effort and as soon as possible.
It is very important before operating in real, to control our greed, since otherwise it will make us trade excessively and take high risks, which instead of helping us, will burn our trading accounts. Greed will make you enter the market to open positions without control, and without having the patience to wait for the best opportunities.
Greed will only make us have more positions than we can open, that we try to double and triple our accounts in a short time, that we are always changing our strategy, because the one we currently have does not give us enough operations to win in a short time, etc. ..
If you feel identified with any of the cases that I have commented above, it means that you are not controlling your greed.
How can we control greed?
The most advisable thing is to identify the feeling of greed, making the decision that you do not have to earn a little more. We must continue with a rational trading plan, since greed can lead to excesses in trading, something similar to the famous addiction to gambling that we must avoid
-Realistic targets
-Control leverage
-Resist the temptation
-Probabilities in your favor
-Forget about easy money
Thank you, I hope it helps you to understand many of the emotions that you feel daily in your operation, remember that nobody gets rich overnight, it is a long road based on perseverance and perseverance.
1- FEAR: “The mortal enemies of the speculator are: ignorance, greed, fear and hope. (Jesse Lauriston Livermore) "
-Do not open a position out of fear: it is a common mistake in trading, and it is something that we have to learn to eliminate from our operations. When we sit in front of the screen to carry out our operations we have to put aside all our emotions and focus on what is really important.
Therefore we have to learn to overcome that fear that hurts us daily in our operations.
Fear is something that is not lost, it is an emotion that accompanies us all our lives, but what we can achieve is to replace that feeling with another, such as security.
How can we overcome fear?
In order to overcome fear, apart from working on it every day, we have to have very clear rules of our operations (when to buy, when to sell, what securities to buy, where to invest, etc.)
It is important to be properly trained, to be able to understand everything that happens in the market, to be able to understand why market movements happen, it will make us gain a lot of confidence in ourselves and will reduce our fear of not understanding why this action / index / pair of currency has moved like this.
It is very important to have a trading plan, and to follow it without breaking any rules.
Trust yourself:
The fear of losing can be counterproductive, causing more losses; And it comes from a lack of confidence in your own abilities.
If you constantly prepare, have a well-defined strategy and master market sentiment: it is time to trust yourself more.
Practice a lot:
Practice makes perfect, and the more you practice, your fear will gradually disappear.
The more operations you have in your career as a trader, the more you will learn to accept that it is inevitable to lose money in this career. The market is a fluctuating environment, any operation can go wrong, due to factors beyond your control. Don't let this discourage you, proper risk management and practice will help you overcome this fear and cope with it.
When you no longer sweat or your emotions make the decisions for you when you are in front of the monitor, you will know that you are on the right path
2- GREED: "Greed is of such an evil and perverse nature that it never satisfies its voracious appetite, and after eating it is hungrier than before (Dante Alighieri" *
Greed is a very important emotion in trading, but it is a very dangerous emotion. Most of the people when starting in this sector want to earn more and more money, with minimal effort and as soon as possible.
It is very important before operating in real, to control our greed, since otherwise it will make us trade excessively and take high risks, which instead of helping us, will burn our trading accounts. Greed will make you enter the market to open positions without control, and without having the patience to wait for the best opportunities.
Greed will only make us have more positions than we can open, that we try to double and triple our accounts in a short time, that we are always changing our strategy, because the one we currently have does not give us enough operations to win in a short time, etc. ..
If you feel identified with any of the cases that I have commented above, it means that you are not controlling your greed.
How can we control greed?
The most advisable thing is to identify the feeling of greed, making the decision that you do not have to earn a little more. We must continue with a rational trading plan, since greed can lead to excesses in trading, something similar to the famous addiction to gambling that we must avoid
-Realistic targets
-Control leverage
-Resist the temptation
-Probabilities in your favor
-Forget about easy money
Thank you, I hope it helps you to understand many of the emotions that you feel daily in your operation, remember that nobody gets rich overnight, it is a long road based on perseverance and perseverance.