Is blowing accounts a necessary learning curve in ones trading journey?
Success is not possible if trading psychology is not managed properly. If you want to make a consistent profit, you must control your emotions.
Not all traders with blowed accounts managed to be successfull at the end, but all successful traders got one or several blown accounts
It is best to start with a demo account, create a trading plan after you succeed to earn on a regular basis, then start trading with a real account in small amounts and from there continue …
Many skills are required for trading successfully in the financial markets. They include the abilities to evaluate a company’s fundamentals and to determine the direction of a stock’s trend. But neither of these technical skills is as important as the trader’s mindset. Containing emotion, thinking quickly, and exercising discipline are components of what we might call trading psychology. There are two main emotions to understand and keep under control: fear and greed.
Unfortunately, I think it might be as there’s a learning curve. People tend to learn better from their mistakes.
If you’re interested in trading psychology, I recommend the Disciplined Trader and Trading in the Zone by Mark Douglas. He makes the case that most traders are their own worst enemy if they let greed or fear take control.
You’ll find book reviews here:
Thank you for sharing this. I’ll definitely give them a read
Of course, it is. Without making losses, you won’t get to learn what wrong you are doing and how you can make the most of the market. I agree that losses can dishearten you but that doesn’t mean they should stop you from trading.
Correct, we should learn to accept that some losses will occur. We can only try to minimise them but not eliminate them completely.
It is not necessary but it sure gives you a sense of responsibility. Good luck to you.
Whether yours is a small account or a big, blowing a forex account can never be enjoyable. However, an inevitable part of the trading world, every trader experiences this once before they start experiencing constant profits. What one should understand is that instead of feeling low, consider it as part of your learning process and mark what need not be done in the future.
If you can’t master emotions, you can never survive in trading. So you have to maintain negative psychology first.
It’s true that blowing accounts can teach a trader so much. But if it becomes a daily habit, you need to do something about it. Losses are an important part of your trading career but it doesn’t mean that you should not do anything about these losses. You must check what went wrong and try to improve in the next trade.
I do not think it in that way. Surely, blowing off the accounts will happen at times in a trader’s journey, but it does not necerssarily teaches them anything. The losses can be due to emotional decision or wrong reading of the market. But I also feel that a wrong decision should not create any pessimist environemt around the trader, it is so imporatnt to move on as quickly as possible.
It is not necessary but it is a part of trading. We all learn from the mistakes so in a way it gives us experience. Don’t give up, instead consider it a part of your learning process.
You might have heard “Sometimes we need to lose the small battles in order to win the war”. Same is the case with forex trading. Losses are part of the learning process. So, keep learning from your mistakes and don’t repeat those mistakes in future.
I read somewhere that, If a trader don’t accept the small losses then eventually he has to bear the mother of losses. So I think learning from the mistake only makes up the forex trades more worthy.
Psychology is a part where there is no place for exemptions. Psychology must be maintained no matter how many strategies I apply.
It is not necessary, however it is possible that during the learning process, even the most experienced traders might have blown up their accounts. And it is not a rule of thumb that you will be successful only if you make losses. Looking from a broader perspective, everyone has their own stories.
I have heard this many times - if you want to make a profit you need to learn how to control your emotions - and it is true. You cannot let your mind be controlled by your emotions as most likely your decisions will not be that good. If you are frightened you are going to keep back, while if you are greedy you are going to rush forwad and be hasty. So you need to be rational and stay in middle ground. Managing to do this is not that simple but you can manage with experience and a good strategy.