Peter Brandt’s 50 Rules — Day 21

Rule #21: Emotional Drawdowns Are Exponential

“A 10% drawdown doesn’t feel twice as bad as 5% – it feels 5x worse.” – Peter Brandt

Lesson:
Drawdowns aren’t just numbers — they’re emotional weights. The psychological pain grows disproportionately as losses deepen, often leading to bad decisions.

Key Takeaway:
Control your risk to keep drawdowns shallow. Smaller losses protect not just your capital, but also your mental state and discipline.

Today’s Market Reflection:
In crypto, rapid 20–30% swings can break traders emotionally, even more than financially. Position sizing and disciplined stops keep you steady when volatility strikes. Protect your psychology as much as your portfolio.

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