Let's talk about the most critical lesson in trading — Stop Loss (It's really important, and I have always emphasized this to my followers)
Many beginners can strictly implement stop losses at the beginning, decisively exiting after a 10%-20% loss. But once losses exceed 50%, their mindset starts to change — "It's already dropped this much, why not add to the position to lower the cost?" As a result, the more they add, the more it falls, ultimately leading to a deep loss of 80% or even going to zero.
It's not that they can't understand the trend, but rather that when losses become significant, they start to gamble against the market: clearly the position has broken but they stubbornly hold on, and as soon as there’s a slight rebound, they rush to exit. In the end, it becomes "losing big when losing, and winning small when winning."
My trading discipline is very simple:
1. Let profits run when in profit; take profit if a 15% gain retraces to 10%.
2. Immediately stop loss if losses exceed 5%; never add to the position to lower the cost.
3. As long as I maintain a 2:1 risk-reward ratio (gain 10%, lose 5%), even if the win rate is only 50%, I can achieve stable profits in the long run.
The hardest part is not the method, but controlling your hands and heart. The market is specialized in treating all forms of disobedience; remember: as long as you are alive, you have the chance to turn things around.
