Day 2: Divide Your Losses into Two Categories
【Today's Thought】 Some losses are a cost; others are waste. If you can't tell the difference, you'll stay stuck in the same hole forever.
【Main Text】
Review your last 10 trades and mark each one:
• Category A: Losses within the rules. You had a reason for entering, set a stop-loss, and used an appropriate position size. The loss was part of the probabilities.
• Category B: Losses outside the rules. Chasing a trade, holding on to a losing position, entering on impulse, or gambling with an oversized position.
Once you've marked them, you'll notice something: Category A losses are usually few, while Category B losses make up the majority.
This isn't a matter of luck. Category A losses are the cost of doing the right thing, and over the long term, the expected value can make up for them. Category B losses are pure waste; not a single one helps you build anything.
The difference between professionals and retail traders isn't their win rate. It's that almost all of professionals' losses are Category A.
【Today's Action】 List 10 trades, mark each A or B, and count the number of trades and total amount for each category.
【Check-in】 Day 2｜Category A: __ trades, __ yuan｜Category B: __ trades, __ yuan
【Today's Thought】 Some losses are a cost; others are waste. If you can't tell the difference, you'll stay stuck in the same hole forever.
【Main Text】
Review your last 10 trades and mark each one:
• Category A: Losses within the rules. You had a reason for entering, set a stop-loss, and used an appropriate position size. The loss was part of the probabilities.
• Category B: Losses outside the rules. Chasing a trade, holding on to a losing position, entering on impulse, or gambling with an oversized position.
Once you've marked them, you'll notice something: Category A losses are usually few, while Category B losses make up the majority.
This isn't a matter of luck. Category A losses are the cost of doing the right thing, and over the long term, the expected value can make up for them. Category B losses are pure waste; not a single one helps you build anything.
The difference between professionals and retail traders isn't their win rate. It's that almost all of professionals' losses are Category A.
【Today's Action】 List 10 trades, mark each A or B, and count the number of trades and total amount for each category.
【Check-in】 Day 2｜Category A: __ trades, __ yuan｜Category B: __ trades, __ yuan
