Trading

Top 10 Causes Of Your Loss In Financial Markets

You have to say to yourself, “If I’m right, how much am I going to make? If I’m wrong, how much am I going to lose?” That’s the risk/reward ratio.”

Peter Lynch
  1. You’re trading without any knowledge of the financial markets.
  2. Your risk to reward ratio is inappropriate.
  3. You don’t care about position sizing.
  4. Unconsciously, you treat trading as gambling.
  5. You don’t do any research of your own and rely on the opinion of others.
  6. You have low self-esteem and because of that, you make multiple mistakes after losing a trade.
  7. You hate losing money, hence you try to prove yourself right by overtrading.
  8. You don’t learn from your mistakes and rely on luck.
  9. You don’t think in terms of probabilities.
  10. Your present loss overwrites your past profit and in the future, you lose money because of your habit to lose.
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