I realize that my greatest weakness in trading is riding my winners… Like I mentioned multiple times before, I am extremely risk-averse…. Thus, I never had problems cutting my losses… in fact, when I recently read in a forum that a lot of people do not use stop loss… I was totally beyond words… Couldn’t believe it… to me, that’s insane… But well, to each his own… I guess as long as it works for you, it’s fine…
Anyway, back to topic… though I always cut my losses… I never ride my winners… out of fear and greed… I normally close my positions for a small win, only to see the trend continue for a substantial period of time…
I always know that the adage “You can never go broke taking profits” is wrong… Many successful traders had explained how silly this concept is… because you need your big winners to cover your losses and your trading overhead… so, it is important to have many small wins and a few big wins… Nonetheless, I always freak out when I see a profitable trade turn against me… and choose to take whatever profits is left or even to close at breakeven (or a small loss)…
Therefore, I’ve decided to work on my exit strategy… I do have a ‘well thought out’ exit plan… but I need discipline in implementing it… I need to convince myself that my exit plan works… As a result, I’ve decided to “collect evidence” (screenshots)… and post them on my blog… (check it out here)…. that way, I can refer to them whenever my fear kicks in… hope this works….
