Learn from Losses

Learn from LossesLesson 7 of 94 min read

Review the wins

The same two questions asked after a winning trade, and why a win taken outside the plan is worth more attention than a loss inside it.

Reviews usually happen only after losses. That leaves half the record unread.

A win can be badly executed

A winning trade can contain every mistake a losing one does. The entry can be early, the stop can be in the wrong place, the size can be wrong.

It made money anyway, which is the reason nobody looks. The mistake survives because the result hid it.

Profit is not proof that the trade was taken correctly.

Ask what could have been better

On every win, ask the same two questions. Could the entry have been better, and was more reward available than you took.

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