#TradersLeague

In contract trading, how to overcome the urge to run when making a profit and to stubbornly hold on when facing losses?

As a rookie currently in this situation, this topic resonates deeply with me, and I would like to share some insights.

Usually, when I make a small profit, I immediately secure it, as I have often seen my gains turn into losses in an instant due to market fluctuations. This approach is not necessarily wrong, but the decision to close a position should be based on the circumstances; if the trend is moving in a favorable direction, it might be worth waiting a bit longer.

The issue of stubbornly holding on to losses seems to stem from psychological factors; it's about overcoming one’s own mental barriers. One must convince oneself to set stop-loss limits; at a certain point, one should cut losses, as holding on can be very risky, leading to a potential liquidation. Furthermore, being cautious about averaging down is crucial; you are already at a loss, and adding more positions brings you closer to the liquidation line. I've tried this many times; while stubbornly holding on isn't necessarily a problem, after averaging down several times without improvement in the trend, I ended up being liquidated.