Good question. I would not say there is a “conflict” per se between staying disciplined and taking chances when you see good ones because you, I hope, would not take chances if it wasn’t a good one in the first place. That would be like rolling a dice aka gambling.
I believe one needs to be disciplined enough to follow their trading plan/ strategy, which, I hope, includes taking chances when you see good ones.
True, some chances are riskier than others but all trades are risky. Ever read the mandatory disclaimer that trading is a “risky business”?
I’m going to answer your question in two ways…
- Yes. In plain, straightforward terms, like many have said, there is a conflict. Trading on a whim, hunch, or emotion and quickly lead to bad results. Don’t do it.
- You want the flexibility to trade opportunities when you see them. Then make that part of your overall trading plan. That is, trade 90% of your account with a reliable strategy. For example, let’s say it has a 60% win rate with 1:1 to 1:2 return. With the remaining 10%, have one or more strategies that are high risk:reward but with lower win rate. For instance, win rate of 30% but R:R’s are 1:4 or better (or whatever the numbers are for a winning plan overall). The “catch” to his approach is that your 10% strategies must still be well-defined. Otherwise, you are just trading emotions, not proven results.
With this 10% high risk allocation, you can have a bit more fun with your trading. The 90% allocation could be on the 4H or higher time frames while the 10% trading is on the lower time frames where you’re scalping a couple of times a week.
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theres a thin line between these two. discipline according to me means the calculated risk and know when tio enter and exit. whereas risk means to get into trouble knowing the fact it will go in loss.