Mindset vs. reality

[The Cryptovator]

Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

Whether you agree or not, trading is always riskier for time than holding. Because I am not a good trader at all, I just do trading with small funds; otherwise, I like to hold and take profit on time. But taking profits from the holding isn't smooth always. It's hard to understand when we need to sell; even accumulating is quite easier for me.

However, a few people would be experts on the trading, and they could make more money from the trading than holding. Logic won't be applicable for everyone; each would have different logic. All the people won't think how I think actually. Some people felt safe on the plane, but some people would feel safe in the car. Because if a plane crashes, then there is a very low chance of staying alive. But from the car accident you can expect highly that you may stay alive, though there is a chance of death.

[Big Dirams]

Traders who thinks it's all easy to make profit have not started trading yet because through the learning process alone they will be made to understand that real trading is different from using a demo account and when they have graduated from learning to becoming real traders the idea of profit making always will be reduced because huge profits are not easy to get but if you are a long term investor with time you could land yourself a very good profit compared to the one you make in trading.

A lot of new traders and many people who ain’t into trading always feels trading is less risky and in trading one can make profits at any given time. To them it just opening positions and making profits that how they see it, they misunderstood the concepts of trading and think of it  as place to make quick money without no risk at all just free money flying around the air with no owners.
 Trading is much more complicated than all this their thinkings. Using demo account is just a minor trading and with demo account emotions don’t fall in or triggers at all that why we can open so many positions with bigger lot size but as soon as we shift to real money account then the emotions fall in place and cautions begins to occur.

[Arenga pinnata]

Imagine that you are on a plane and the plane is taking off or landing. Suddenly the plane shakes a lot, your heart starts beating fast and you feel like you are going to die. But then you get off the plane safely and get into your car. Finally, you reach your home through the crowd and traffic. During the time you were in the car, you never once thought that an accident could happen. Statistically, your chances of dying in a car accident were much higher than your chances of dying in a plane. But we are afraid of planes, but we are not afraid of cars. It is quite interesting that our brain is afraid of things that are logically safe, but at the same time it is not afraid of things that are logically risky.

 Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

Flying on a plane is actually like trading futures. Because if there’s an accident, the chances of survival are very low. Just like in futures trading, where if we make a mistake, having our position liquidated is quite common. Whereas with a car, even if we might lose, no position gets liquidated unless it’s due to a rug pull.

But yeah, regarding long-term investments, they’re much safer, so the answer is indeed correct. But remember, this only applies to Bitcoin.

So I hope what you mean is holding Bitcoin, right? Because aside from Bitcoin, I think it’s not safe at all. In fact, I’d rather trade it if it’s anything other than Bitcoin.

[BitMaxz]

Traders who thinks it's all easy to make profit have not started trading yet because through the learning process alone they will be made to understand that real trading is different from using a demo account and when they have graduated from learning to becoming real traders the idea of profit making always will be reduced because huge profits are not easy to get but if you are a long term investor with time you could land yourself a very good profit compared to the one you make in trading.

Demo accounts can still be useful, but they will never help you remember the mistakes you made while using them.
There is no emotion involved in a demo account, whether you win or lose any trades.
In my experience the demo accounts are just used to familiarize yourself with how to trade, but it won't help you improve.
That's why after I got into live trading I have a mix of eagerness and fear when executing a trade.
What I learn is when I trade in a live market, all mistakes are unforgettable compared to when you trade demo.
Even a small capital still will give you a bit of impact when you lose or win a trade.

So, before you invest large sums of money, I recommend that you start with a small amount to train your brain in live trading. Practice with real money can help you perform better. Just like what happened to me, I lost all of my capital in a single trade. My mistake was holding a position with no SL and thinking that it might reverse, which is a bad mindset.

However, I start with demo and paper money; it helps only to familiarize and to test some strategies, but it will never teach you how to handle your emotions when trading.

[justdimin]

Both trading and long-term investment are actually risky especially if you trade or invest blindly. But the risk level differs. There is higher risk with trading because you are trading in such an unpredictable market that creates unpredictable outcome, unlike with long-term investing where it prioritizes compounding growth and allow time for investments to recover from downturns.

However, a good trader can eventually minimize the risk in trading, through learning from the past mistakes and losses, and learning from the experiences of reliable traders in the market.

I would beg to differ here. Even long-term investors can have massive profits as seen in the past. We have seen people making fortune while holding a few coins which skyrocketed due to their use case. Even people holding bitcoins for more than 7 years have made huge profits while minimizing risks. Yes, even a trader can make good profits, but the risk remains at a larger scale which in most cases erases the profits off books. That is the reason why long-term holders preferrable play safe while traders always have a hanging knife above their head.

I would say good skills can make you minimize risks which will come after years of practice. Expecting profits in the first year might be foolishness and you would need to invest good amount of time in order to learn trading.

[Alpen]

Imagine that you are on a plane and the plane is taking off or landing. Suddenly the plane shakes a lot, your heart starts beating fast and you feel like you are going to die. But then you get off the plane safely and get into your car. Finally, you reach your home through the crowd and traffic. During the time you were in the car, you never once thought that an accident could happen. Statistically, your chances of dying in a car accident were much higher than your chances of dying in a plane. But we are afraid of planes, but we are not afraid of cars. It is quite interesting that our brain is afraid of things that are logically safe, but at the same time it is not afraid of things that are logically risky.

 Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

People are right to fear planes. They aren't looking at the probability of a crash, but at their survival rate if one happens—which is zero. In a train, however, you can walk away without a scratch even after a bombing; we’re seeing plenty of examples of that lately.

I believe there’s always room for compromise. You can mix train and air travel to diversify your risks. If airships were still in style, having a parachute would bring the risk of losing your life down to almost zero.

In trading, you can also reduce the probability of losing funds to zero. To do this, you simply trade spot and avoid leverage. If the position goes into the red, you can just weather the storm and become a long-term investor.

If I do want to speculate with leverage, I only use the profits from my staking rewards. For instance, the 20% APY I get on Cryptomus is enough to trade with 5x leverage, giving me the same profit potential as my staked spot assets without risking the principal.

[AVE5]

Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

If you know that safety has to do with the defeats of risks and threats and you also understands how risky trading maybe and what it requires to be profitable as an investor, then you should never compare the risks of trading which involves technical studies and same time, prediction of volatilities remains unpredictable with NON of the strategies to be reliable on in taking the risks of trading, you'll understand that the risks of investments which basically requires investors patients with the insight of holding for a long term goals will be very common to be defeated than trading.
Accumulation strategies such as the Dca for the investment is an added opportunity to acquire more Bitcoins.

[bitgolden]

Traders who thinks it's all easy to make profit have not started trading yet because through the learning process alone they will be made to understand that real trading is different from using a demo account and when they have graduated from learning to becoming real traders the idea of profit making always will be reduced because huge profits are not easy to get but if you are a long term investor with time you could land yourself a very good profit compared to the one you make in trading.

Yeah, if you are a trader then you know that making money from trading is very difficult, this is why I think that my situation looks to be a lot different situation and we should be considering how this could be very different situation at hand.

I think we should be considering how this could be different situation and if we are careful about it then we could definitely consider this to be something that will mean a lot with time, and in reality we are seeing it being very tough thing to do.

[macson]

The mistake most people make when they first get into trading is that they only see others’ success stories and fail to realize that trading is far riskier than they imagine. They think that once they start trading, they’ll be as successful as what they see online.

But because of their short-sighted mindset, and only focused solely on profit, they don’t prepare themselves properly and trade as if they already possess extensive knowledge. It’s no surprise that they end up suffering heavy losses because of their mindset, which from the very beginning has led them to believe that trading is so easy.

[ZAINmalik75]

Imagine that you are on a plane and the plane is taking off or landing. Suddenly the plane shakes a lot, your heart starts beating fast and you feel like you are going to die. But then you get off the plane safely and get into your car. Finally, you reach your home through the crowd and traffic. During the time you were in the car, you never once thought that an accident could happen. Statistically, your chances of dying in a car accident were much higher than your chances of dying in a plane. But we are afraid of planes, but we are not afraid of cars. It is quite interesting that our brain is afraid of things that are logically safe, but at the same time it is not afraid of things that are logically risky.

I thought you were trying to say something else and wrote it by mistake, but no, you actually wrote it intentionally. By the way, there is quite a lot of risk on an airplane too, and the experience during takeoff and landing can be nerve-racking. Because of that, a person naturally feels scared at that moment. But as soon as they get off the airplane and sit in a car, they feel like they have come out of a major risk, so smaller risks do not bother them as much anymore. There are other reasons behind this as well, including psychological and natural factors, but I have understood your point to some extent.

When we are trading, it is highly risky, but sometimes we think it is not that risky. That is not completely true because everyone knows trading is risky. I have not seen a single person here who claims that trading is not risky, and I have also never seen anyone say they have met someone who thinks trading is not risky 🙂

[Dareo]

The mistake most people make when they first get into trading is that they only see others’ success stories and fail to realize that trading is far riskier than they imagine. They think that once they start trading, they’ll be as successful as what they see online.

But because of their short-sighted mindset, and only focused solely on profit, they don’t prepare themselves properly and trade as if they already possess extensive knowledge. It’s no surprise that they end up suffering heavy losses because of their mindset, which from the very beginning has led them to believe that trading is so easy.

I will add another aspect many people start trading as a shortcut to making quick money. So they skip the learning phase and run straight towards profit. In my opinion the real mistake is here. If you don’t see trading as a skill, but as luck or easy income, the mindset is wrong from the beginning. Then even small losses are not tolerated, and big mistakes are made, In reality trading is a very slow process. First you have to learn to lose, then gradually control comes. If you don’t understand this, most people get frustrated at the beginning.

[Rubuchi]

The mistake most people make when they first get into trading is that they only see others’ success stories and fail to realize that trading is far riskier than they imagine. They think that once they start trading, they’ll be as successful as what they see online.

other people’s success stories are meant to motivate you to go into trading and not for you to cancel out the reality that comes with trading. If you are the type of person that only things about wins and successes alone and you don’t give little room to the reality that you may also likely lose, you may endanger yourself to more lose because you will be overzealous about your actions without carefully considering the consequences of such actions.

But because of their short-sighted mindset, and only focused solely on profit, they don’t prepare themselves properly and trade as if they already possess extensive knowledge. It’s no surprise that they end up suffering heavy losses because of their mindset, which from the very beginning has led them to believe that trading is so easy.

mindset places a key role in trading. Your actions and reactions towards trading are most of the time measured based on your mindset towards trading. Every trader is supposed to have a good knowledge on how markets work in the cryptocurrency world before they should go into trading. When you trade with the mindset of winning big without factoring into your own considerations that you can also lose, you may end up taking decisions that will be of disadvantage to you.

[Odogwu-Blockchain]

Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

Trading is more risky than investment because it carries lots of emotions and tensions when dealing with it, no matter how experience a trader may think he is, the possibility of failing many times and losing money is assured, because sitting at the front of the screen thinking and strategizing with a global market chart is quite challenging.

Over time depression comes in, while the trader smiles in public and cry in silent, others think he's making profits by watching the only the successful testimony from the trader and never his failure. That's what makes it looks good at the surface but draining on the inside. The plain example is perfect for this.

[Pandorak]

The mistake most people make when they first get into trading is that they only see others’ success stories and fail to realize that trading is far riskier than they imagine. They think that once they start trading, they’ll be as successful as what they see online.

But because of their short-sighted mindset, and only focused solely on profit, they don’t prepare themselves properly and trade as if they already possess extensive knowledge. It’s no surprise that they end up suffering heavy losses because of their mindset, which from the very beginning has led them to believe that trading is so easy.

Yes, that happens because of a flawed mindset from the start, we only focus on the profits others make, so without realizing it, we only want to see the potential gains rather than the actual risks of loss, which should be recognized and studied first. If we had understood this from the beginning, we might have been able to minimize the risks once trading began.

On the other hand, it must be acknowledged that regardless of the circumstances, long term investment remains the best option, especially during volatile market conditions like those we’re experiencing now. You don’t need to worry about the risks because long term growth guarantees returns, as adoption continues to expand, prices will keep rising. Although no investment instrument is entirely risk free, every investment carries its own risks, but at least this is the most promising option in the long term.

[Peanutswar]

But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

First is people gets feed by fear by its environment its planted to their minds now if you do this regularly fear become lessen because you know already what to do such as your story in the plane, you arent go to ride a in plan so every movement you observe and sometimes you get overthink things, now because its now a norm to ride a car you think its safe the same way in trading if you dont know what you are doing you will get paranoid if this are still right or you are burning your money but afterwards once you already know how to handle like in the car its become now a basic thing once you understand.

Actually basic selling and buying will be considered as trading I guess do you mean a short term trading such as lower time frames are riskier than long term hodling or investment.

[Primark]

But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

First is people gets feed by fear by its environment its planted to their minds now if you do this regularly fear become lessen because you know already what to do such as your story in the plane, you arent go to ride a in plan so every movement you observe and sometimes you get overthink things, now because its now a norm to ride a car you think its safe the same way in trading if you dont know what you are doing you will get paranoid if this are still right or you are burning your money but afterwards once you already know how to handle like in the car its become now a basic thing once you understand.

Actually basic selling and buying will be considered as trading I guess do you mean a short term trading such as lower time frames are riskier than long term hodling or investment.

No matter how experienced you are in regular trading, making a profit from trading is quite challenging. An experienced trader can never say that he has ever faced losses. A person can do anything, trade, invest or even gamble, it is everyone's personal choice. But I just want to say that compared to trading, long-term investment in Bitcoin seems to me the most open. Where the value of the investment increases over time. The main purpose of long-term investment is to buy Bitcoin regularly and build savings in the long term without any pressure. But trading seems quite stressful to me.

[Big Dirams]

No matter how experienced you are in regular trading, making a profit from trading is quite challenging. An experienced trader can never say that he has ever faced losses. A person can do anything, trade, invest or even gamble, it is everyone's personal choice.

You have a point mate, no matter how experienced a trader might be or how knowledgeable a trader turns out to be there is always some little challenges before one could make profits. But one thing is for sure, the more knowledgeable a trader is the higher chances of success one hits.
 Trading might be difficult at times but with the right experience and knowledge we can make it out successful. And also facing losses or part of the journey and as we all are aware losses are inevitable so no matter the experience nor knowledge losses will always fall in place.

[ASloveapg]

Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

Whether you agree or not, trading is always riskier for time than holding. Because I am not a good trader at all, I just do trading with small funds; otherwise, I like to hold and take profit on time. But taking profits from the holding isn't smooth always. It's hard to understand when we need to sell; even accumulating is quite easier for me.

However, a few people would be experts on the trading, and they could make more money from the trading than holding. Logic won't be applicable for everyone; each would have different logic. All the people won't think how I think actually. Some people felt safe on the plane, but some people would feel safe in the car. Because if a plane crashes, then there is a very low chance of staying alive. But from the car accident you can expect highly that you may stay alive, though there is a chance of death.

Some of the reasons why trading is called risky are that decisions have to be made based on market changes, due to which many people make wrong decisions. When greed and emotion interact, decisions are not logical. At the same time, if someone makes decisions beyond their financial capabilities without managing their own risk. Trading is more risky for most people due to lack of proper knowledge, management, planning, and analysis experience. However, it is not that no one is being harmed in the case of holding. Many people are also being harmed there due to lack of proper planning and management. And in the case of holding, many people accept defeat while being patient and maintaining discipline for a long time. However, holding is less risky than trading, but it is not completely safe. Success does not always depend on strategy but also on one's own mentality and discipline.

[Ishicryptic]

I know that a lot of young people who are looking for online jobs to make money will always fall for influencers hypes that trading is profitable just to direct them to register with money for tutorials, these newbies have the right mentality but the reality is opposite of what they were told. In theory trading seems easy but in practical it is a very risky job because you can lose your money very fast before you know what is happening. This is why people don't need to jump into trading because somebody somewhere said that it is a fast way to make quick money, if they researched first they will understand that trading is risky and it's not for everybody, also that it is not a get rich quick scheme.

[Hamza2424]

Interestingly, this mindset of the brain also occurs in trading. Many people, tempted by the stories of some people's trading profits, consider trading safe. But logically and statistically, trading is much riskier than long-term investment. But many people consider trading to be more safe, which in most cases can lead to losses.

Bro, the analogy is interesting, but it could be better. Anyway, the core point is valid and makes sense. Our brains are genuinely terrible at assessing risk accurately unless we have years of experience.

The survivorship bias problem is the main reason why trading feels safer than it actually is. The wins are loud and public, while the losses are quiet and private. That is because people do not want to share the reality with their followers. If they do share, most of them only show their profits. After seeing those profits again and again, our mind builds a completely distorted picture of what trading actually looks like statistically.