TRADING LESSON - Why Most Traders Lose Money and The Solution

There are hundreds and hundreds traders if not thousands of traders trade..., and over and over again we see smart people who have been intelligent enough to accumulate large sums of money in their non trading careers open a trading account and loose huge sums of money making what you would think are easily avoidable mistakes that one would think even the dumbest traders would avoid.

Those same traders are the ones that consider themselves too good or smart to make the same mistakes that so many others make, and that will skip over this section to get to what they feel is the “real meat” of trading, strategies for picking entry points. What these traders and so many others fail to realize is that what separates the winners from the losers in trading is not how good someone is at picking their entry points, but how well they factor in what they are going to do after they are in a trade into their trade entries and how well they stick to their trade management plan once they are in the trade.

For the few who do get that money management is far and away the most important aspect of trading, the large majority of these people don’t understand the large role that trading psychology plays in money management or consider themselves above having to work on channeling their emotions correctly when trading.

So we are going to first start with a look at the psychology of money management and the role that this plays in causing so many traders to lose their shirts and then move on to ways of managing this before finishing up with specific strategies for managing trades once you are in them.