Common Trading Mistakes: Run When You Profit, Hold On When You Lose

As a rookie currently in this state, I can deeply relate to this topic and would like to share some insights.

Usually, when I make a small profit, I quickly secure it, as I have experienced many times how quickly a favorable situation can turn into a loss. It's not that this approach is wrong, but whether to close a position should be judged based on the circumstances. If the trend is moving in a favorable direction, it's still worth waiting a bit longer.

The issue of holding on to losses feels more like a psychological problem; it's about overcoming one's own mental barriers. You must convince yourself to set stop-losses; at a certain point, you need to cut your losses. Holding on too long is too dangerous, and one misstep could lead to a liquidation. Additionally, being cautious about averaging down is crucial; if you are already at a loss and you average down, you are getting closer to the liquidation line. I have tried this many times; holding on is not a problem in itself, but after averaging down a few times, if the trend doesn’t improve, the result can lead to a liquidation.