Why do traders lose money in trading?

[milewilda]

It is undeniable that if we follow our ambitions, we will always want to get high profits in a short time. Well, this is what we should actually avoid, because if we have that mindset, it will actually make our risk even greater, because we will rush into making decisions and it is based on wanting to quickly see and take advantage. If so, instead of the profits we get, losses will come to us. The market is not something that is easy to analyze, it definitely takes time to find the right point for us to enter. Sometimes when we have found the right time there are other factors that can suddenly change market conditions, that is also something we must be aware of.

In addition to being able to analyze when is the right time to enter the market for trading purposes, every trader must also be able to determine the time to exit when they have made a profit from trading. Because market trends that always change differently will force every trader to monitor and also learn new things that happen through unexpected conditions in order to be saved from losses. Because in a job like trading which is always close to risk, of course we should not make hasty decisions if we can still wait and hope for better market conditions.

Indeed, both side should be learned not just your entry but more on the exit side, where both profits and loses are being determined, you need to continue learning the process if you want to succeed from this venue of business, the industry most of the time change its directions whether you already have a good glampse of potentials but in some reason changes can be done.

With good grasp of every knowledge that you learned you'll be able to work on it and keep improving your strategy, you need to established your own patterns to anticipate how the market works for you to make some decent benefits.

Its common sense that you should really be also thinking about your exit because there would really be a time that we would really be having those considerations on when we would really be taking profits
on which i would say that it would be that a common approach to have. It will really be just that be basing up on how you would be applying up your analysis. Do traders lose money? Of course we could
and its the part of the risks specially into those people or traders who do actively deal up with market volatility on which we know that its not something simple on making yourself that profitable.
This is why it would really be that important that you should really know on what you are dealing with so that you could be able to handle out basing on whats are the things gets involved and the best
approach and things to be done.

This is why its really that important that you should be having that kind of realistic approach towards it and dont make yourself that being too optimistic or something that been expecting about positive results
on the time or moment that you do make out trades. Come to think that there would really be tons of factors on which it would be affecting the overall outcome of price movement on which it will really be that
affecting the result of your trading position on which it could neither be losing or a winning one. If you dont make yourself that versatile or good when it comes to handling emotions then you would
simply get stressed out on such manner.

[Jody.Drummer]

In addition to being able to analyze when is the right time to enter the market for trading purposes, every trader must also be able to determine the time to exit when they have made a profit from trading. Because market trends that always change differently will force every trader to monitor and also learn new things that happen through unexpected conditions in order to be saved from losses. Because in a job like trading which is always close to risk, of course we should not make hasty decisions if we can still wait and hope for better market conditions.

Indeed, both side should be learned not just your entry but more on the exit side, where both profits and loses are being determined, you need to continue learning the process if you want to succeed from this venue of business, the industry most of the time change its directions whether you already have a good glampse of potentials but in some reason changes can be done.

With good grasp of every knowledge that you learned you'll be able to work on it and keep improving your strategy, you need to established your own patterns to anticipate how the market works for you to make some decent benefits.

Yes, you are right, not only when we enter we have to analyze, but when is the right time to exit must also be analyzed properly, so that we can get optimal results. Trading is not as easy as it seems, we are required to always be aware of the market. Because the market moves sometimes very quickly and it could be not like what we believe because it is influenced by other things. Also prepare mentally before trading, just assume that the loss is in front of our eyes so that we can be more careful in making decisions. Sometimes it is difficult to distinguish between being careful and afraid, well in this case our courage in taking risks will also work, there must be a risk taken and that is through courage.

[Dewi Aries]

I think you have put all the lists correctly regarding the reasons why someone experiences significant losses in trading, and in my case usually the first point is always difficult for me to avoid where it is very difficult for me to maintain discipline regarding planning and risk management rules that I have made so that in the end I often fall and get carried away where I walk outside the path that I should.

But in most cases I see that point number four is always a problem experienced by traders where the majority of traders, especially beginners, always find it difficult to avoid greed and excessive worry, and of course that is one of the factors that can affect decision making, because when greed or excessive worry is involved then it will really make it difficult for you to make wise considerations to make the right decision that is in accordance with market conditions.

[Fredomago]

In addition to being able to analyze when is the right time to enter the market for trading purposes, every trader must also be able to determine the time to exit when they have made a profit from trading. Because market trends that always change differently will force every trader to monitor and also learn new things that happen through unexpected conditions in order to be saved from losses. Because in a job like trading which is always close to risk, of course we should not make hasty decisions if we can still wait and hope for better market conditions.

Indeed, both side should be learned not just your entry but more on the exit side, where both profits and loses are being determined, you need to continue learning the process if you want to succeed from this venue of business, the industry most of the time change its directions whether you already have a good glampse of potentials but in some reason changes can be done.

With good grasp of every knowledge that you learned you'll be able to work on it and keep improving your strategy, you need to established your own patterns to anticipate how the market works for you to make some decent benefits.

Yes, you are right, not only when we enter we have to analyze, but when is the right time to exit must also be analyzed properly, so that we can get optimal results. Trading is not as easy as it seems, we are required to always be aware of the market. Because the market moves sometimes very quickly and it could be not like what we believe because it is influenced by other things. Also prepare mentally before trading, just assume that the loss is in front of our eyes so that we can be more careful in making decisions. Sometimes it is difficult to distinguish between being careful and afraid, well in this case our courage in taking risks will also work, there must be a risk taken and that is through courage.

Yeah, correct anticipation is very important both entry and exit should be learn as you will be able to lessen your loses and maximize your potential benefits, It can be learn while working inside the market, expereinced also influence your anticipation as aside from good analysis and assessments there are other factors that you need to consider that may affect your emotions which also most of the time is the reason why you are losing money when you are inside and executing your trades.

[shawonngp]

Losing money in trading happens to many people.The main reason is not having enough knowledge about trading.Not being able to analyze the market.Trading without understanding the market situation.Too much leverage and repeated trading.Due to these reasons almost people lose money in trading.

Lose is happen for every traders; no matter experienced traders or beginners, but experienced traders will not losses in constantly, most of the time they are making profits but newbies traders losses in many reasons like lack of enough knowledge, not maintaining discipline and not analyzing market condition those  point is op mentioned.

[Woodie]

From my experience, here are 4 reasons I discovered:

Valid reasons you have put across, but I think  even if a trader developed these attributes many show signs of greed and emotions disguised  as gambling because they want to be overnight millionaires which never happens unless once in a million trades...

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

Having being on the trading table before, I can tell you that it's difficult to develop this skill because price doesn't immediately go into profits once your trade is triggered, and nobody wants to be in  losing position hence the indiscipline.

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

Having the knowledge should be priority one for one to develop a trading plan.

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.

Guess this comes with the knowledge you talked of above 

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.

The stats are there for all to see and profitable traders take a 2-3 trades in a month sometimes the motive is to make a 1% ROI and wait for next setup which is good for one's mental health.

[Gladitorcomeback]

Lose is happen for every traders; no matter experienced traders or beginners, but experienced traders will not losses in constantly, most of the time they are making profits but newbies traders losses in many reasons like lack of enough knowledge, not maintaining discipline and not analyzing market condition those  point is op mentioned.

And it's not only about losing constantly or not, it's all about learning from your mistakes and improving your skills so that you can reduce your losses over time. That is how a person becomes good at something. You can't be an expert right after you start doing something, but you master the art when you keep grinding and learning in the process so that one day, you become almost perfect in what you are doing.

Experienced traders incur losses as well, there is no doubt about that, but what they are good at is learning from their losses. They evaluate their mistakes and remove those mistakes from their practices for the next time, and the next time when they incur a loss, they do it again. This way, after some time, they start getting profit on most of the trades they make because they have been rectifying their mistakes and now they know the dos and don'ts of it.

[betswift]

Losing money in trading happens to many people.The main reason is not having enough knowledge about trading.Not being able to analyze the market.Trading without understanding the market situation.Too much leverage and repeated trading.Due to these reasons almost people lose money in trading.

Lose is happen for every traders; no matter experienced traders or beginners, but experienced traders will not losses in constantly, most of the time they are making profits but newbies traders losses in many reasons like lack of enough knowledge, not maintaining discipline and not analyzing market condition those  point is op mentioned.

I agree with you. Experience shapes your path and you should become more knowledgable and ready for different situations to come. Self-learning is a must and you should allocate enough of your time for it.

[tvplus006]

Despise all the strategy being applied, trading is not 100% guarantee but if proper analysis is being put in place at least your wins will be more than you lost, and you can be said to have made profit...

If you do not adhere to risk management, you will lose your money anyway, since you will not be able to open an order in the right direction every time with 100% probability. Thus, you should minimize the loss as much as possible if the price goes in the opposite direction to your expectations, so that this does not affect your deposit as a whole.

[Richkiedx]

because most of the traders seek a very large profit while others have no risk management and do revenge trades

[Dewi Aries]

Despise all the strategy being applied, trading is not 100% guarantee but if proper analysis is being put in place at least your wins will be more than you lost, and you can be said to have made profit...

If you do not adhere to risk management, you will lose your money anyway, since you will not be able to open an order in the right direction every time with 100% probability. Thus, you should minimize the loss as much as possible if the price goes in the opposite direction to your expectations, so that this does not affect your deposit as a whole.

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.

[Xcode7]

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.

[TatsuyaJemi]

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.

[tvplus006]

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...

That's right, the topic can be closed) In fact, when I lose 2-3% of my deposit, the beginner will lose it completely. And this is determined by the leverage, the amount for which the order is open and, of course, the stop loss, which, if necessary, will limit my losses. Now all that remains is to follow strategy exactly)

[Dewi Aries]

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.

Yes, that's right, and in trading there are two things that can trigger risks, the first is caused by a trader's uncontrolled emotions (which is usually what often leads a trader to greater losses) and the second is caused by market fluctuations (a reasonable risk that cannot be completely avoided), so when you want to become a trader, you must first know about what can cause risks, whether it's a reasonable risk or a risk that occurs due to something unnecessary such as emotions, and this second point is what a trader really must be able to maximize, or in the sense that in any way they must try to control themselves.

As you said, that's absolutely right, where losses are something that is common in the world of trading and are experienced by all traders, or simply put, there is not a single trader who has never experienced a loss, and this is why a trader is always advised to have a strong intention and determination to learn, because only by learning will they get development by gaining various new knowledge that will make them a little more protected from the possibility of significant losses, especially avoiding losses caused by emotions.

[Ndabagi01]

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.

[Septex]

As a trader or as a successful trader, no one can say that he has not faced losses while trading. Many newbies do not try to understand this fact. If you start a new business now, it won't be like you're just making a profit and never incurring a loss. Similarly, a trader will definitely face losses while trading. Because no matter how much market analysis is done here, still in some places he is not fully able to understand the future which results in loss by trading. Again after trading, when the market starts going down, many people get stressed and many times get emotional, not being able to reach the right decision and get hurt by the train. So by doing it slowly and over time it is also possible to get through the day.

[fikrett]

As a trader or as a successful trader, no one can say that he has not faced losses while trading. Many newbies do not try to understand this fact. If you start a new business now, it won't be like you're just making a profit and never incurring a loss. Similarly, a trader will definitely face losses while trading. Because no matter how much market analysis is done here, still in some places he is not fully able to understand the future which results in loss by trading. Again after trading, when the market starts going down, many people get stressed and many times get emotional, not being able to reach the right decision and get hurt by the train. So by doing it slowly and over time it is also possible to get through the day.

I totally agree with you here.
You should always consider the risks at hand and understand that not all days are going to be green, as you said.
Over time, traders learn how to control their emotions and look at the bigger picture. It just clicks.

[smelody]

As a trader or as a successful trader, no one can say that he has not faced losses while trading. Many newbies do not try to understand this fact. If you start a new business now, it won't be like you're just making a profit and never incurring a loss. Similarly, a trader will definitely face losses while trading. Because no matter how much market analysis is done here, still in some places he is not fully able to understand the future which results in loss by trading. Again after trading, when the market starts going down, many people get stressed and many times get emotional, not being able to reach the right decision and get hurt by the train. So by doing it slowly and over time it is also possible to get through the day.

I totally agree with you here.
You should always consider the risks at hand and understand that not all days are going to be green, as you said.
Over time, traders learn how to control their emotions and look at the bigger picture. It just clicks.

Most days are not green for a trader and he has to tailor his investment decisions accordingly.
Should buy more during red digits so as to sell during green ones.

[nara1892]

As a trader or as a successful trader, no one can say that he has not faced losses while trading. Many newbies do not try to understand this fact. If you start a new business now, it won't be like you're just making a profit and never incurring a loss. Similarly, a trader will definitely face losses while trading. Because no matter how much market analysis is done here, still in some places he is not fully able to understand the future which results in loss by trading. Again after trading, when the market starts going down, many people get stressed and many times get emotional, not being able to reach the right decision and get hurt by the train. So by doing it slowly and over time it is also possible to get through the day.

I totally agree with you here.
You should always consider the risks at hand and understand that not all days are going to be green, as you said.
Over time, traders learn how to control their emotions and look at the bigger picture. It just clicks.

Of course, knowledge and understanding related to potential risks must be possessed by a trader, because then various precautionary measures or other actions that lead to risk management such as money, time and emotion management will be in your mind, therefore this is why from the beginning a trader must first do research related to what and how the world of trading really is, do not only look at the side of the profit opportunities but the risk part must also be considered.

However and in any case losing money is a situation that no one will ever want to experience, therefore use a rational mindset so that from the start you know and understand that trading can not only be profitable but can also lose your money.