Struggling with Losing Trades? Try This Unusual Yet Effective Trading Tip

Online Trading: A Challenging Endeavor Online trading is an arduous, laborious activity in which achieving success is difficult. This is a truth that all traders know, and beginners learn the hard way - unless they have become aware of it beforehand. Of course, for those who win, the potential reward is immense and enables reaching a level of wealth that is precluded by the classic work approach. Only a small percentage of traders find themselves with a positive balance at the end of the year. If you fall into the category of losers, rather than taking solace in shared misery, think about how to escape the quicksand. Theoretically, there are answers for every need and solutions for every problem. They may be difficult to implement, but not impossible. In this article, we will do just that: we will discuss some causes that make an online trading activity a losing one and list possible solutions. Finally, we will offer a "smart" but unusual solution to what is, most likely, the biggest obstacle that traders must face.

Losing Traders: An Unpleasant Truth

First of all, we need to delve into what we defined at the beginning of the article as "truth." That is, the real dimension of the loser category. Here, it is obvious that the term "loser" should not be understood in the common sense, with a derogatory meaning. A losing trader is not an incompetent trader; they are simply a trader whose activity is not profitable. There can be various reasons for this to happen, not necessarily related to any technical error. Moreover, as can be seen from the first paragraph (and from the experience of most market operators), defeat is far from a rare event when it comes to online trading. So, what does this truth really consist of? The numbers explain it clearly and unequivocally. Actually, just one number: 85% of traders end the year with a negative balance. In other words, they lose money from their activity. An astonishing, alarming figure that can discourage anyone. However, if you look at the corollary, you can understand why online trading attracts and continues to attract more and more people: those who win, that 15%, take the whole pie. Those who become aware of this fact, rather than throwing in the towel, should aim to achieve a goal: to transform the hope of making a profit (i.e., being part of the 15%) into a real possibility. To do this, it is necessary to investigate the causes of defeat. Above all, it is necessary to implement effective solutions, better yet if they are rarely used and intelligent as a result of lateral thinking. We will discuss the latter at the end of the article. In any case, there is another element that tends to mitigate the severity of the 85% figure. Within it, in fact, beginner traders are included, who in most cases are improvised and have started "investing" because they were encouraged by a well-placed advertising campaign. Hopeful people, maybe willing, but who entered the market without real attendance. Generally, the market makes the necessary selections, but in the meantime, they contribute to the statistics, adding substance to the 85% figure.

Why Online Traders Lose

We said that the first step to making online trading activity profitable and moving from one category to another is to understand the causes of defeat. It's a less easy step than it might seem, also because the reasons (especially one, we'll talk about it later) are obvious only up to a certain point. A small preview: the reasoning about the causes concerns a bit of everything and goes far beyond the question, albeit important, of technique. This gives an idea of the complexity of online trading, of its ability to propose various layers of interpretation, each of which brings its own pitfalls and risks to the table. So, here are the main reasons why a trader is a loser.

False Illusions

This is the main problem among beginners. To tell the truth, it only closely concerns them. Also because those who have been in online trading for a few months or even a few years have already gone beyond the infatuation phase and approach speculative investment activity perhaps without much profit but still with seriousness and realism. The problem of false illusions is a serious one, but it is not a problem attributable only to traders. Some advertising campaigns, in fact, are misleading and aggressive. The fact is that if a beginner approaches with the conviction of being able to earn easily, they are destined to crash immediately and badly.

Lack of Training

This is a problem that apparently only afflicts beginners, but which is actually more common than you might think. Let's start with the beginners. They should enter the market only after several months of study, therefore after having completed a specific and arduous training course. Online trading, as we have now understood, is an incredibly complex activity, because the dynamics (technical and otherwise) that regulate the market are complex. Those who cannot manage this complexity are destined to lose badly. The problem, however, also concerns fairly experienced traders, although in this case it takes on different connotations and results in the simple but inevitable need for updating. As much as it is driven by some "evergreen" rules, online trading, and the market in general, is a constantly evolving entity. Therefore, it is necessary to keep up with it.

Poor Money Management

This, on the other hand, is a problem that can potentially affect everyone. Also because its opposite, that is, good money management, is one of the many keys to success. It is obvious, almost trivial: those who manage their finances well have a greater probability of generating profits. Behind this simple statement lies another truth: the first step to earning money is... Not losing money. Too bad that following this indication in online trading is extremely difficult, precisely because it is a high-risk activity. Therefore, money management means first of all managing risk, understanding how much each single action risks compromising one's capital. It is no coincidence that Money Management and Risk Management are two sides of the same coin.

Lack of Strategy

This step is already more difficult to understand. Those who approach online trading are often convinced that some indications or formulas are necessary to be successful, or at least to avoid ending up at a loss. Nothing could be more wrong. Online trading, in order to be truly profitable, must be understood as a process, and a process always requires a strategy. Now, trading strategies are a very complex topic, but suffice it to know that, even before drafting a strategy (or adapting someone else's to oneself), it is necessary to understand two things: where you want to go, how you intend to get there.

Low Emotional Resistance

Here is the problem of problems. As strange as it may seem, it surpasses all the others in consequences and severity. Emotions are enemies of trading, they compromise lucidity and lead to wrong choices. Nevertheless, they represent an element that cannot be separated from trading. At most, one can hope for a painless management of them. Unless you put in place a sui generis solution, which shuffles the cards. We will discuss this solution at the end of the article. A solution, it is good to remember, strange but potentially very effective.

Solutions to the Problems

It is good to repeat it: there are solutions to these problems, and moreover, they are in the public domain. There is nothing strange or particular. Obviously, if we exclude the "creative" solution to the emotional problem, to which we will dedicate the final paragraph. In any case, the difficulty lies precisely in implementing these solutions. The first step, however, is to become aware of their existence. So, here is a list of "recipes" to stop losing. Illusions. The problem, to tell the truth, is soon resolved. There are two ways. One is brutal: crashing directly against the truth, perhaps losing one's capital but finally becoming aware of what trading really is. The second is less dramatic: understanding from the beginning that, after all, advertising is advertising, and should be taken with a grain of salt. Training. Here the solution is simple to understand but tiring to implement: study. If you are a beginner, embark on an all-encompassing journey. If you can, rely on a mentor. For the rest, anything goes: manuals, ebooks, webinars, online courses. How long should the training last? It depends on your cultural background. We are talking about several months. Money management. Here the money management techniques are complex, and we refer you to another article. However, know that the first question to ask yourself is: how much can I afford to lose? The rest is all consequential. Strategy. It includes various elements, such as the asset to trade, the analysis protocol, the choice of signals to consider for entry and exit, risk control measures. A piece of advice: do not copy strategies "as is" from others, but adapt them to your situation (in the hope that they are scalable). Emotionality. How to solve the problem of emotionality? It's very complicated. The most attempted solution is working on oneself. That is, the autogenic training that should lead to having more cold blood, resisting stress, experiencing emotions but at the same time detaching them from one's operation. Is that enough? Yes. But there is a but...

An Unusual Piece of Advice

We come to the "strange but effective" advice for solving the emotional problem. We said that emotions are a problem. Both negative and positive ones. Fear and anxiety make one impulsive and unclear. Euphoria makes one reckless. Excess of self-esteem does the same. Does working on oneself work? Yes, and it is absolutely necessary. However, it is a long and tiring process, which also requires good teachers and an iron willpower. In the meantime, what happens? Are you destined to lose? In the meantime, but also afterwards, it is possible to put a solution in place. Use tools that separate emotions from trading activity. These tools are automated trading software. That is, programs that are preset based on your strategy and carry out the operation automatically, without the need for human intervention. One of the best on the market is EvoForex, of which you can find a description here. Why are automated trading software effective in solving the problem of emotionality? Simple: they allow the trader to be absent precisely when emotions risk taking over, that is, during the operational phase, the one in which capital is committed. Fear, anxiety, stress are greatly reduced. Obviously, they are not easy tools to learn, but they can give enormous satisfaction. Therefore, regardless of the path of personal or emotional growth, consider using them.