I’ve been dabbling (ok, more than dabbling) in prop firm futures trading for a couple of years, now. I’ve had some success, but have consistently lost money. Every time I blow an account, I get down on myself for being so stupid. I mean, I have like an 80% success rate for my trades. But, inevitably, I get cocky and think I cannot lose. Then I take a trade that goes against me and I think it’ll turn around so I keep moving my stop and even adding to the position! And, of course, before you know it, my account is blown.
I know I’m not alone. We all do stupid things. I consider myself to be a smart guy, but still it happens. I don’t think the problem is taking a bad trade, but my inability to admit I was wrong and cut my losses. Sometimes, I do exit a bad trade. And, do you know what, it immediately reverses as I had hoped/expected! Or, it does come back to near break even, and then I get greedy and try for more profit only to have it reverse once again and blow my account.
I am creating this series of posts so that I can record my thoughts and ideas as I try – yet again – to solve the problem of me not having the discipline to exit a bad position.