Why do traders lose money in trading?

[Fredomago]

Its very simple. Most people do not know about the stop loss order, this stop loss order is a directive that is submitted to a broker to purchase or sell a particular stock at a predetermined price. It is intended to mitigate an investor's loss on a security position. This stop loss orders are an important part of managing risk in the stock market. Traders who don't set and follow stop loss or who take on too much risk can lose a lot of money when the market goes against them. So be careful

This is a very important thing that every trader must know while trading but I don’t think this is the major cause of traders to lose money amongst the many others that are prevalent. I think only a novice trader who has not undergone any mentorship of deep self learning by themselves will not be able to know about the stop loss order in the market. Greed and FOMO is one of the major reasons traders lost money. When you’re too greedy and want to win more when your target is already achieved or on its way to achieve it, you can lose all of your money when the market consolidates. Also, a missed trade should not be entered again because it’ll only give you the impression to go in higher than what you can sacrifice and when it countertrends, you’ll lose more money than intended. There are lot more to this, but this two are among the prominent ones traders always fall victim to lose money more often.

Yeah, I agree to that if this kind of practices continue then the end outcome mostly against your favor, if you allow greed without proper adjustments then you might lose your investment, though there are greed that can be use if you really pay attention with your research, there are traders who manage to continue making money after setting up their target and adjust things when they see open opportunities,

but not all can do that as greed also leads you to be drunk with that earn success thinking that it will continue to push thru and eventually corrections will trigger and lead you to lose that particular opportunities.

[Lanatsa]

Its very simple. Most people do not know about the stop loss order, this stop loss order is a directive that is submitted to a broker to purchase or sell a particular stock at a predetermined price. It is intended to mitigate an investor's loss on a security position. This stop loss orders are an important part of managing risk in the stock market. Traders who don't set and follow stop loss or who take on too much risk can lose a lot of money when the market goes against them. So be careful

This is a very important thing that every trader must know while trading but I don’t think this is the major cause of traders to lose money amongst the many others that are prevalent. I think only a novice trader who has not undergone any mentorship of deep self learning by themselves will not be able to know about the stop loss order in the market. Greed and FOMO is one of the major reasons traders lost money. When you’re too greedy and want to win more when your target is already achieved or on its way to achieve it, you can lose all of your money when the market consolidates. Also, a missed trade should not be entered again because it’ll only give you the impression to go in higher than what you can sacrifice and when it countertrends, you’ll lose more money than intended. There are lot more to this, but this two are among the prominent ones traders always fall victim to lose money more often.

Yeah, I agree to that if this kind of practices continue then the end outcome mostly against your favor, if you allow greed without proper adjustments then you might lose your investment, though there are greed that can be use if you really pay attention with your research, there are traders who manage to continue making money after setting up their target and adjust things when they see open opportunities,

but not all can do that as greed also leads you to be drunk with that earn success thinking that it will continue to push thru and eventually corrections will trigger and lead you to lose that particular opportunities.

Self control is something that would really be relevant on the moment that you do deal up with trading on which this is something that you should really be mindful on taking up such consideration because on the time or moment that you do lose up control then it would really be ending up on a disaster on the time or moment that you do make out trades. Control and discipline in terms of emotion isnt really just that relevant on gambling but also in other things as well such as investment,gambling and even into those simple decisions in life on which you would really be needing up such moderation and control, so that you wont really be ending up on a messy situation just because you do find yourself become that impulsive. This is why it would really be that important on having these considerations.

Losing money in trading is really just that normal and this is something that it is really that part on this kind of career that you would really be taking. This is why on the time or moment that you do consider
out on doing trading then you should really anticipate for these things to happen so that you wont really be getting disappointed.It is really that important that you should really be having
back up plans whenever you do have a losing trade. Never ever act as a gambler because on the moment that you do chase your loses then it would really be that bringing out more problems.

[rhodelmabanal]

From my experience, here are 4 reasons I discovered:

1/ Lack of Discipline— a) Not sticking to one strategy, b) not respecting your trading rules, c) not sticking to your plan.

2/ Lack of knowledge—Inadequate understanding of the market, trading strategy, financial instruments, and fundamentals can lead to poor decision-making.

3/ Not having a mechanical trading system—This leads to emotional trading. Decisions driven by emotions like fear and greed rather than rational analysis result in significant losses.

4/ Overtrading—Taking many trades will affect your decision-making ability and lead to poor decisions.

If there are other reasons why traders lose money, share them with me.

There's a lot of reason but i think the number one reason is the emotion, if traders cant control the emotion the greed will follow and if the greed follow it will affect the decision that we make and it will end up losing, this is normal we can all experience this kind of trouble that is why traders that has so many experience mostly earn than the new trader because they can already control thier emotion above the market condition.

[uswa56]

From my experience, here are 4 reasons I discovered:

1/ Lack of Discipline— a) Not sticking to one strategy, b) not respecting your trading rules, c) not sticking to your plan.

2/ Lack of knowledge—Inadequate understanding of the market, trading strategy, financial instruments, and fundamentals can lead to poor decision-making.

3/ Not having a mechanical trading system—This leads to emotional trading. Decisions driven by emotions like fear and greed rather than rational analysis result in significant losses.

4/ Overtrading—Taking many trades will affect your decision-making ability and lead to poor decisions.

If there are other reasons why traders lose money, share them with me.

There's a lot of reason but i think the number one reason is the emotion, if traders cant control the emotion the greed will follow and if the greed follow it will affect the decision that we make and it will end up losing, this is normal we can all experience this kind of trouble that is why traders that has so many experience mostly earn than the new trader because they can already control thier emotion above the market condition.

When someone trades with emotions, it is very difficult for them to trade based on their knowledge because when someone does with emotions, of course it will make them no longer do any analysis on the trades they make, and it is true as you said when they cannot control their emotions when trading, of course they will do it with greed which can pass the profits that have been made. They get it and only regret it when they don't leave a little capital used to trade because of their greed.
If a trader has been able to control their emotions, then when trading, of course, will first do an analysis before deciding on something and this will of course give them good results on the trades they make, and for those who are just starting to trade, of course, they must continue to study well so that they can succeed as a trader.

[Dewi Aries]

From my experience, here are 4 reasons I discovered:

1/ Lack of Discipline— a) Not sticking to one strategy, b) not respecting your trading rules, c) not sticking to your plan.

2/ Lack of knowledge—Inadequate understanding of the market, trading strategy, financial instruments, and fundamentals can lead to poor decision-making.

3/ Not having a mechanical trading system—This leads to emotional trading. Decisions driven by emotions like fear and greed rather than rational analysis result in significant losses.

4/ Overtrading—Taking many trades will affect your decision-making ability and lead to poor decisions.

If there are other reasons why traders lose money, share them with me.

There's a lot of reason but i think the number one reason is the emotion, if traders cant control the emotion the greed will follow and if the greed follow it will affect the decision that we make and it will end up losing, this is normal we can all experience this kind of trouble that is why traders that has so many experience mostly earn than the new trader because they can already control thier emotion above the market condition.

Yes, in most cases, the most common factor that triggers losses is usually emotions, especially for novice traders who do not know many things to avoid and also especially for traders who do have slightly different personalities, such as being easily provoked when things do not always go according to plan or expectations.
Emotions can lead a trader to two possible impulsive decisions, such as greed when they succeed in making a profit and continuing it based on thoughts such as "this is the right time to be an opportunity" to cover the amount of losses they have previously experienced.

Or continuing to trade after experiencing a loss due to being unable to accept the fact that they lost money based on despair and emotions to take revenge on the market, and in the end both scenarios will only lead a trader to greater losses until they experience MC, and for the problem of whether they will be able to overcome such problems or not I think it comes back to each of them, simply if they want to learn from the experiences and mistakes they have made then they should not repeat the same mistakes in the future.

[shawonngp]

Basically, risk management is not something that will completely prevent you from the risk of loss, or in other words, no matter how good the risk management you have designed, the risk of loss will always be something that may happen at any time without any indication, but of course one of the reasons why having the discipline to always apply risk management is because the possibility of loss that you will face will be less frequent than if you trade without having any prevention plan.

Profit is nothing more than probability and it also depends on how much knowledge you have to execute the market correctly at the right time, we must remember that our goal here is to seek profit, meaning this is the reason why focusing on various risk management plans that lead to prevention must also always be maintained and do not just focus on various ways to get the benefits.

Risk management is to minimize risk, it does not mean that when we are able to learn risk management, the risk will disappear, in trading the risk is very large so it is important for us to learn to minimize risk.
It is true as you said that everything comes back to yourself to learn everything before deciding to trade and wherever we seek profit will be comparable to the risk we face, it cannot be denied.

And regarding the many traders who experience losses, I think it is common, everyone must experience something like that, but it can be used as a lesson to be a turning point for us to learn better to be able to turn things around, namely getting profit like our initial goal in trading.

Trading is always full of risk, we cannot trade risk free in trading. We must accept the risk. But trading cannot be done without knowing anything, because when we learn about trading, it is possible to reduce the risk of trading by various strategies, which greatly reduces the amount of our losses. So we need to learn trading, and fully understand trading and then trade.

No way; trading will never risk free if you ask about in experienced traders they are also always taking risk in trading but they have proper knowledge in trading and they following their own strategies like risk management, control emotion and greed, at least they can control their money in any bad condition in the market but that is impossible to new traders.

[superman22]

From my experience, traders make decisions based on emotions, ignorance, and poor strategies to manage risks resulting to losers. Some always let their emotions dictate the course of trading for them and rarely employ a stop loss order. Daily learning and a rational approach are essential to achieve a goal. In addition, other benefits of investment diversification include managing risks or reducing on them.

[Akbarkoe]

From my experience, traders make decisions based on emotions, ignorance, and poor strategies to manage risks resulting to losers. Some always let their emotions dictate the course of trading for them and rarely employ a stop loss order. Daily learning and a rational approach are essential to achieve a goal. In addition, other benefits of investment diversification include managing risks or reducing on them.

That is what is difficult to control in trading, managing emotions often makes us have the wrong trading decisions, and even more impulsive which ends in large losses on the trade, It is very natural for traders to lose money at low levels of emotional control, I have also experienced it.

The thing that can help control emotions is to have a lot of understanding of how good and correct trading strategies, have targets and limits in trading so that our logic will warn our emotions to stay on the right path and not be easily influenced to make a decision that is not relevant to the analysis and strategies that has been made.

[nara1892]

Trading is always full of risk, we cannot trade risk free in trading. We must accept the risk. But trading cannot be done without knowing anything, because when we learn about trading, it is possible to reduce the risk of trading by various strategies, which greatly reduces the amount of our losses. So we need to learn trading, and fully understand trading and then trade.

No way; trading will never risk free if you ask about in experienced traders they are also always taking risk in trading but they have proper knowledge in trading and they following their own strategies like risk management, control emotion and greed, at least they can control their money in any bad condition in the market but that is impossible to new traders.

Of course, from the beginning it is clear that trading is an activity that involves money, opportunities and risks, meaning that there are only two possibilities in trading, namely profit or loss, profit depends on how smart you are in executing the market and loss is something that occurs due to market fluctuations. One of the reasons why a trader is always advised to only use the amount of money they can afford to lose is because there is no strategy that is 100% accurate, meaning that losses will always be very possible to happen to you, but when you have a lot of knowledge along with good risk management, the possibility of risk can be minimized.
The market will continue to move and fluctuate, you will never experience a loss if you can know what will happen in the future, but that is impossible, and that is why risk cannot always be avoided.

[kawetsriyanto]

From my experience, traders make decisions based on emotions, ignorance, and poor strategies to manage risks resulting to losers. Some always let their emotions dictate the course of trading for them and rarely employ a stop loss order.

If the people still can't control their emotion and decide everything based on the emotion, it means they aren't ready to be real traders. They need to learn again how to be proper traders, they need to know how to manage emotion. It will be too risky if we trade with uncontrolled emotion, this just increases the chance of possible losses.

Daily learning and a rational approach are essential to achieve a goal.

It is not necessary to learn every day but it is needed to learn continuously. We don't learn trading like we learn our subjects in schools. However, we must learn it seriously as we learn all the school subjects. 

In addition, other benefits of investment diversification include managing risks or reducing on them.

Diversification is surely needed. It is not only to reduce the risks, it also increases the chance of optimum profits. It allows us to get profits from some assets. However, we must be careful to diversify assets. Don't diversify into random assets!!

[GeorgeJohn]

In trading you need to understand that trading is all about precaution and if you fail to exercise patients and learn all the necessary procedures of trading, so what I know very that is the major problem that's happening to people in trading, is that a lot of them concentrate in making profits without considering factors that can make them to lose, its obvious that you can't be making profits subsequently in trading even though you have learnt all the necessary steps of trading at least we have to know that trading is all about risk...one of the reasons that is clear that makes traders to lose is lack of experience, so people lose money in trading very well they have not gotten enough experience of trading.

[FortuneFollower]

In trading you need to understand that trading is all about precaution and if you fail to exercise patients and learn all the necessary procedures of trading, so what I know very that is the major problem that's happening to people in trading, is that a lot of them concentrate in making profits without considering factors that can make them to lose, its obvious that you can't be making profits subsequently in trading even though you have learnt all the necessary steps of trading at least we have to know that trading is all about risk...one of the reasons that is clear that makes traders to lose is lack of experience, so people lose money in trading very well they have not gotten enough experience of trading.

Trading responsibly is essential, without thinking about the risks at stake you can lose yourself in the market.
By building up your knowledge, self-discipline, and experience, you will be able to not let the market dictate what you do. You will be your own master.

[Dr.Osh]

In trading you need to understand that trading is all about precaution and if you fail to exercise patients and learn all the necessary procedures of trading, so what I know very that is the major problem that's happening to people in trading, is that a lot of them concentrate in making profits without considering factors that can make them to lose, its obvious that you can't be making profits subsequently in trading even though you have learnt all the necessary steps of trading at least we have to know that trading is all about risk...one of the reasons that is clear that makes traders to lose is lack of experience, so people lose money in trading very well they have not gotten enough experience of trading.

I also think that a very important point in trading is patience. it leads many people to failure. even I also experienced failure because of lack of patience. However, choosing an asset to trade is quite easy. just choose a popular coin. however, in this case we need patience. many people fail because they are impatient to wait for the price increase or impatient because the price drop is quite deep.

[liasbaa]

In trading you need to understand that trading is all about precaution and if you fail to exercise patients and learn all the necessary procedures of trading, so what I know very that is the major problem that's happening to people in trading, is that a lot of them concentrate in making profits without considering factors that can make them to lose, its obvious that you can't be making profits subsequently in trading even though you have learnt all the necessary steps of trading at least we have to know that trading is all about risk...one of the reasons that is clear that makes traders to lose is lack of experience, so people lose money in trading very well they have not gotten enough experience of trading.

Trading responsibly is essential, without thinking about the risks at stake you can lose yourself in the market.
By building up your knowledge, self-discipline, and experience, you will be able to not let the market dictate what you do. You will be your own master.

To do this you need to be more disciplined in your investment and keep yourself in the holding trend. Patience should be introduced during buying and bullish periods during regular bearish periods and proceed with long-term trading methods. You should arrange the investment plan through experience and patience and coordination. Ownership of holdings depends on your disciplined investment.

[Fredomago]

In trading you need to understand that trading is all about precaution and if you fail to exercise patients and learn all the necessary procedures of trading, so what I know very that is the major problem that's happening to people in trading, is that a lot of them concentrate in making profits without considering factors that can make them to lose, its obvious that you can't be making profits subsequently in trading even though you have learnt all the necessary steps of trading at least we have to know that trading is all about risk...one of the reasons that is clear that makes traders to lose is lack of experience, so people lose money in trading very well they have not gotten enough experience of trading.

I also think that a very important point in trading is patience. it leads many people to failure. even I also experienced failure because of lack of patience. However, choosing an asset to trade is quite easy. just choose a popular coin. however, in this case we need patience. many people fail because they are impatient to wait for the price increase or impatient because the price drop is quite deep.

Most of the time, correction made those people who lack of patience lose their investments, thinking that everything is completely done and they need to act quickly to avoid heavy bleeding only to find out that recovering period is just around the corner, they already decide before they notice that market just playing around and sometimes it's just a manipulation especially those hype assets that traders mostly followed for quick outcome.

[add1ct3dd]

The thing that can help control emotions is to have a lot of understanding of how good and correct trading strategies, have targets and limits in trading so that our logic will warn our emotions to stay on the right path and not be easily influenced to make a decision that is not relevant to the analysis and strategies that has been made.

What's funny is that most traders these days don't have a strategy or the ability to do analysis. I'm talking about newbies here, those who get into the market with the mindset that they can make a lot of money from it in a short period if they have enough money, they don't realize it doesn't work that way, and having money alone isn't enough to make them reach the other side and achieve their goals in a financial market as volatile as this.

Misguided newbie traders are often driven by emotions and their decisions are mostly influenced by gut feelings and not analysis or research. They lack the basic understanding of the trading principles which include learning which is the very first step and it can't be skipped because if you skip the learning part, all other parts will fall apart at some point.

[CageMabok]

Trading responsibly is essential, without thinking about the risks at stake you can lose yourself in the market.
By building up your knowledge, self-discipline, and experience, you will be able to not let the market dictate what you do. You will be your own master.

What you said is very true even though every trader does not consider himself to be fighting the market, but only tries not to be dictated by the currents in the market with the level of change that continues to occur in it. Knowledge of the market and also experience in trading will always be a more useful initial foundation because with these two things every trader can apply self-discipline and build a good enough strategy when trading in the market. Because trading does not have to be done at every moment even though every moment needs to be known and utilized well by every trader.

[Nrcewker]

From my experience, traders make decisions based on emotions, ignorance, and poor strategies to manage risks resulting to losers. Some always let their emotions dictate the course of trading for them and rarely employ a stop loss order. Daily learning and a rational approach are essential to achieve a goal. In addition, other benefits of investment diversification include managing risks or reducing on them.

Trading is all about taking the right decision at the right time. Now how can one make the right decisions? It comes from experience only. Hence, the more you trade, the more you get acquainted with trading. Also, it’s important to gain theoretical knowledge. I have seen many new traders directly jump into trading without knowing the basics. Give time to yourself to learn about the market. Watch YouTube videos of other traders and see their trading styles. It’s better to learn from their mistakes than from your “own” mistakes.

[Easteregg69]

Short term you lose money. Long term you will see your pushing your old bags around.

I just got kicked of for posting. Some mental is after me. Bugging me. On this forum. An admin or something.

[Easteregg69]

From my experience, traders make decisions based on emotions, ignorance, and poor strategies to manage risks resulting to losers. Some always let their emotions dictate the course of trading for them and rarely employ a stop loss order. Daily learning and a rational approach are essential to achieve a goal. In addition, other benefits of investment diversification include managing risks or reducing on them.

Trading is all about taking the right decision at the right time. Now how can one make the right decisions? It comes from experience only. Hence, the more you trade, the more you get acquainted with trading. Also, it’s important to gain theoretical knowledge. I have seen many new traders directly jump into trading without knowing the basics. Give time to yourself to learn about the market. Watch YouTube videos of other traders and see their trading styles. It’s better to learn from their mistakes than from your “own” mistakes.

You thrive on bad mouthing people.