WHICH TYPES OF FEARS ARE PERSONALIZED BY EACH TRADER:
*When there is not enough necessary knowledge, fear of the unknown appears.
*The problem for perfectionists is the fear of making a mistake and being wrong
*Because of the desire to catch all market movements to the maximum, fear is created to miss the moment.
*The more trader losses in the past, the greater the fear of losing.
* Fear of making a losing trade or a series of such.
*Fear of not noticing a signal to enter / exit a transaction.
*Fear of losing a profitable deal.
*In addition, there are others that are not directly related to trading – to lose income, work and family.
How to overcome the fear
1 Less capital put stops and profits, control risks – this is your area of responsibility. Trade only your own money, do not get into debt. Take risks that are not scary and not sorry to lose. If the deposit size is too small, even a proven strategy will not save – if the account has less than $ 500, then set the goal to master trading, and not to increase capital. Start with $ 1,000, they should not be the last and even more borrowed. Psychologically, one must be prepared to lose this amount – this is a kind of tuition fee.
2.Lose a lossless is the norm. They can and should be controlled. Each transaction cannot be profitable, because the market cannot be calculated. Clearly indicate the margin of probable loss. Let’s say this is 20% of the capital with an account of $ 1,000. And if you lose 600 of them on one transaction, then you need to immediately exit the market and analyze the situation – most likely you did something wrong.
3 Make several unsuccessful transactions in a row. After 3 unsuccessful transactions, stop, exit the market and analyze the trade. It looks like you are making the same system error. Until you calculate it, do not trade further.
4.You need a trading strategy that will identify changes in the market and respond quickly. It’s hard to predict what the price will be over a period of time, but it’s many times easier to understand where it will go. Because trade is controlled by the market, and not vice versa. Remember the Pareto rule – of the total number of transactions, only 20% will bring profit, the rest will be unprofitable. And this is normal statistics.
5 Total self-doubt Learn to switch from negative to positive, otherwise, you will not bargain at all. Test and improve your trading strategy, track progress, notice even small victories.
6 Fail. Set goals that are realistically achievable, lower expectations, especially in the first year of trading. You are just learning. Major successes will be, but later. Be patient.
7 Lost profits; Control greed; do not open too many transactions; do not keep them open for too long. Do not hope that one potentially large transaction will cover all losses. Observe risk to reward ratio. Do not be greedy or seek thrills. If you want adrenaline, go skydiving or go safari to Africa.
8 Do not notice the signal to enter or exit the market quickly. Because of it, the trader enters too early, preventing the price from forming. To overcome emotions and focus on the trader helps trading on time or other small time frames – this is the only way not to hear the “noise” affecting the price, and objectively predict further movement. Add to this a strategy that is clearly outlined on paper and is in sight. This will reduce fear to a minimum.
9 Stuck on low returns Traders take profit too early and are unable to raise the bar due to inexperience, a chaotic change of strategies, blind faith in the forecasts of new “experts”, distrust of their strategy (if any). To overcome fear, you need to test the technique until you are convinced of its consistency.