Trading 101: Exiting Is Harder Then Entering

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Entering a trade puts us in a world of near infinite possibilities. This is very exciting and enticing. It is what can change individual fortunes very quickly.

In this video I discuss how exiting a position makes it finite. It is the reverse of what was experienced going in.


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Summary:
In this video, the speaker discusses the challenges of entering and exiting trades in the trading world. He emphasizes that while technical aspects of trading can be straightforward, success in trading is more about the trader's emotions, outlook, confidence, and willingness to accept responsibility. The speaker highlights the difficulty in exiting trades due to the psychological aspects involved, such as fear, greed, and the desire to hold onto winners while cutting off winners prematurely. He stresses the importance of following trading indicators, making decisions based on rules, and analyzing trades objectively.

Detailed Article:
The speaker begins by acknowledging that technically, entering and exiting trades may seem simple, but the real challenge lies in the emotional and psychological aspects of trading. He emphasizes that a trader's success is not solely dependent on their trading strategy but also on their emotions, outlook, confidence, and accountability.

The speaker points out the psychological hurdles traders face when it comes to exiting trades. He discusses how the allure of infinite possibilities when entering a trade contrasts with the finality and psychological challenge of exiting a trade. The fear of missing out on potential gains and the fear of giving back profits play a significant role in traders' decision-making process.

The speaker delves into the common tendencies of traders to hold onto losing trades in hopes of a turnaround while being quick to lock in profits on winning trades. He highlights the importance of following trading indicators and sticking to predetermined exit strategies, even if it means overcoming the fear of missing out on potential gains.

Moreover, the speaker stresses the importance of approaching trading decisions in a methodical and rule-based manner. He advises traders to make entering and exiting trades a "brainless" process by relying on research, analysis, and predetermined rules. However, he also emphasizes the significance of post-trade analysis to learn from both successful and unsuccessful trades.

Furthermore, the speaker suggests that once a trade is exited, traders should detach emotionally from that stock or asset. By removing it from their watchlist and focusing on other opportunities, traders can avoid getting emotionally attached to past trades and stay disciplined in following their trading system.

In conclusion, the speaker reiterates the importance of following a trading system, making decisions based on rules, and remaining disciplined in entering and exiting trades. By emphasizing the need to navigate the psychological aspects of trading and approaching trades objectively, the speaker provides valuable insights for traders looking to enhance their trading strategies and decision-making processes.

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