Why do most traders blow their first account

[jossiel]

I'll say a meme.

Because when they are in profit, what they do is not taking profit in actuality.

But just uses the screenshot feature of their phones and computers and saves the supposedly profit that they should have. 

[Sanitough]

Personally, I often see it as a normal thing for new traders in the market. Know that they still lack the knowledge and experience with trading in the market, so its already expected that they will be blowing their first or even the next account.

But mastery will be built in time. Losses will be minimize, and they will start to trade for profits, and maximize their goal target. It may take years before seeing that finally happen, but the important thing is, traders have built their skills and trading strategies after all those losses.

[Sammysmart001]

Many traders abandon a system after just a few losses, even though every strategy goes through losing streaks.

That's spot on. Until a trader gets to that point where they realize that to become profitable doesn't mean an absence of losses. Rather what it means is that losses don't outweigh wins. This is why it's profitable to go for trades with great Risk to Reward. A 1:3 R:R makes a better trade than a 1:1.

Social media doesn't help either. It's filled with screenshots of huge wins, making beginners believe they should double their account every week. That mindset often leads to taking unnecessary risks instead of focusing on consistency.

I lost a great deal as a beginner trader following that mindset from social media traders and mentors. It's pure deceit.

Was there a lesson that completely changed the way you trade?

Yes, for me that's understanding Risk and Money Management. Again, find a strategy and stick to it once it makes you more wins than losses. Don't overtune it to finding a 90% –100% win rate. Anything that gives you above 60% win rate is a winner. Have that mindset and grow from there.

Right on point i so much agree with this point profitable doesn’t mean never taking losses. The very lesson most of our beginners tends not to understand is that they tend to judge some strategy after one or two loss of trades.

Good risk management gives trader opportunity and benefit from different strategies. This because even a strategy having a positive expectation won’t be of help if you go on risking 30 to 50 percent of ur account on just on a trade. Some emotional decisions is enough to wipe month of discipline trades.

Personally I would say we won’t just be saying consistency is the key, but rather be consistent following a trading plan. Not trying to predict ever market correctly but having to accept the loss because this are part of the journey those who survive face. Allot of users can’t face all this and they end up blowing their accounts early

[BlackBoss_]

Right on point i so much agree with this point profitable doesn’t mean never taking losses. The very lesson most of our beginners tends not to understand is that they tend to judge some strategy after one or two loss of trades.

Good risk management gives trader opportunity and benefit from different strategies. This because even a strategy having a positive expectation won’t be of help if you go on risking 30 to 50 percent of ur account on just on a trade. Some emotional decisions is enough to wipe month of discipline trades.

Traders can try to learn, use and test many strategies in order to find which strategies work best for them. Practically, with any trading strategy, the common principle is protecting initial trading capital as best as you can, because with traders losing initial trading capital is most terrible result.

The market is lively 24/7 and opportunities always exist in this market, so it's very important to exit the market for closing a trading position, protecting capital and waiting for other chances in the future. Chances will appear again but traders only can take advantage of good entries if they still have money for trading. Don't be too stubborn by holding a bad position and hoping that something good will come.

The market does not mind about that and bad trading positions, especially with leverages, will mostly not end with profit.

[Franctoshi]

From my personal experience, most of the traders blow their first account due to emotional trading.

Let's be honest here, no one enters trading without the goal of making instant money, so expect that every new trader will often take leverage because they think that's the quickest means they know, until they start to experience devastating losses and wiped out their funds in just a short period of time.

Add to it is that there is no trading plan. They only managed to make one after incurring huge, unacceptable losses.

Trading isn't all about what your mentor teach you online or during a physical class, Trading is a practical experience based skill, that's you learn by experience.
Therefore, in this case, majority of the newbies that found themselves in this hole, goes into trading with the impression they've learnt it all, and then enter trading and that they're about to milk the market according to what they've heard from their respective mentors as regards to earning money immediately They're trading.

[Webetcoins]

What do you think is the biggest reason most new traders blow their first account?

Lack of experience is one of the biggest reasons why new traders blow their accounts easily. When someone lacks experience, they will hardly make proper decisions in trading because they are still new to trading.so due to lack of experience new traders do approach the market without calmness to carry out proper analysis to check certain factors before entering a trade.Another reason is the mindset of some new traders. They see trading as a way to get rich quickly, so they do approach market anyhow and try to carry right risks. And something that new traders should completely avoid at the beginning of their trading journey.

That is true, we end up with a lot of people who come here to be just traders and make a living and get rich, but that doesn't happen that easily and sometimes we are going to end up with bad losses.

If you are a newbie then trying to make a lot of money because you saw some people on tiktok that got rich, isn't the way to get rich, you are not going to get a good result. I understand the feeling and how they want to be richer, but that's not going to happen and we should be careful.

[nara1892]

From my personal experience, most of the traders blow their first account due to emotional trading.

Let's be honest here, no one enters trading without the goal of making instant money, so expect that every new trader will often take leverage because they think that's the quickest means they know, until they start to experience devastating losses and wiped out their funds in just a short period of time.

Add to it is that there is no trading plan. They only managed to make one after incurring huge, unacceptable losses.

Trading isn't all about what your mentor teach you online or during a physical class, Trading is a practical experience based skill, that's you learn by experience.
Therefore, in this case, majority of the newbies that found themselves in this hole, goes into trading with the impression they've learnt it all, and then enter trading and that they're about to milk the market according to what they've heard from their respective mentors as regards to earning money immediately They're trading.

I agree with you, this is the reason why there is a saying that "experience is the best teacher", the reason is because changes based on something we experience ourselves can be more influential than hearing from others such as mentors, feeling and hearing are two different things and this is also the reason why I prefer to learn on my own autodidactically, for the initial steps, maybe a mentor is helpful, especially in providing education regarding the basics of trading, but for the next steps, I think personal experience is much more influential.

[Achalugo BTC]

Personally, I often see it as a normal thing for new traders in the market. Know that they still lack the knowledge and experience with trading in the market, so its already expected that they will be blowing their first or even the next account.

But mastery will be built in time. Losses will be minimize, and they will start to trade for profits, and maximize their goal target. It may take years before seeing that finally happen, but the important thing is, traders have built their skills and trading strategies after all those losses.

That's right, practice makes perfect as they said, so one has to be always be ready to learn, they should not stop even when they feel there is no need in learning again, that doesn't mean they have to stop, as trading involves risks of losses which can cause financial or emotional damage, that is why self-control help in building strategy that helps and protect them. Remember markets change, which means your rules will have to change as well, but if one can withstand the emotional impulses its causing, it will better if they talk to someone they trust for help.

[jcojci]

Most beginners in trading fail because they thinking about making a big profit shortly. They don't think about learning trading and rely on signals from the group so they pick the wrong coins to trade. They don't know why they follow the signals, buying and waiting for the time to sell.

They just blow their account in shortly and if they still don't learn more their mistake, that will happens over and over time. They can change by starts learning trading so they know what they need to do before trading. They don't have to rely on the signal but trying to research more to find the coin.

[Oshio-man]

Some traders only believe in income but they don't know that there Is loss too in trading, once you understand how trading works and you know there is income and loss, you will not stop trading whenever you are experiencing loss or income because trading requires knowledge which is the major tool traders are using to maintain income earning from the market,  some of the talented traders you are seeing around the market they was a newbie before they got to this position they are today,  they lost in trading but they refused to quit trading but newbies these days any small loss they want to quit trading which is not a good decision than to search for those who are ahead of you to impact you more .

[JeffBrad12]

I'll say a meme.

Because when they are in profit, what they do is not taking profit in actuality.

But just uses the screenshot feature of their phones and computers and saves the supposedly profit that they should have.  

Apparently flexing is more important for some people lol, reminds me of some people who generated massive profit but don't realize the profit until it has gone down to 80% downturn from all time high.
There are handful of such people and i'm sure many of us here are one of them  . Exactly the beginners mistake that people need to avoid, those valuation won't be there forever.