A trader's weird thought about capital management

[boyptc]

It's bs to blame that we're losing for how low our capital is with our trades. A good trader can go a small growth and eventually continue to profit and have some losses along way but will still survive and make that small into significant amount.

While that's a factor for how long they can survive the market with their trades, it makes sense for them to blame that if they lose immediately.

If it's me, I won't blame having lesser capital why I lose. A lose is a loss and that means that the market isn't in my favor and I am no good. No need to find other factors but to take accountability for my losses.

[Jatiluhung]

So, what do my fellow traders think about this? Don't mind the title if you don't think it's weird; it's just my opinion.

What I personally think is that if a trader lacks discipline or proper risk management in managing a small account, that indisciplined attitude and poor risk management will still affect them even if it is a big account they are trading. I think one should be able to manage even a $100 account very well before they can handle a $1k or bigger account.

I also know someone who has a mindset of making a big deal out of the difference between small and large capital, using the excuse that it’s their small capital that prevents them from making consistent profits or something like that.

But that doesn’t matter at all. Because if someone is truly disciplined in risk management and also disciplined in managing their emotions while trading, they will definitely be able to generate profitable results in trading.

And someone who uses their small capital as an excuse has likely never experienced the heavier mental pressure that comes with using much larger capital, which sometimes leads us to reduce leverage in the futures market and even become more selective in choosing trading pairs in the spot market.

[bangjoe]

How is it that a trader would think that the reason he is blowing accounts is because he only has a small capital and so doesn't make it a priority to protect that capital, the reason being that it's an amount that he can afford to lose? Is it not weird that someone who cannot manage a small capital trading account would think that if he gets hold of an account with big capital, he can manage it very well and make profits consistently without blowing the account? Do you also think capital is your problems and reason why you are not profitable?

This is an argument that sparked among traders arguing why each of them is not yet profitable. While others gave meaningful and agreeable reasons why they are not profitable, one of them insisted that he is not profitable because his capital is so small and he doesn't care if he loses it or not, and that's why he is not profitable. He said that if he is trading a big capital account like $1k, he can consistently make profits without blowing the account. Note that $1k is considered big, because he is trading with very small capital, not even up to $100.

So, what do my fellow traders think about this? Don't mind the title if you don't think it's weird; it's just my opinion.

What I personally think is that if a trader lacks discipline or proper risk management in managing a small account, that indisciplined attitude and poor risk management will still affect them even if it is a big account they are trading. I think one should be able to manage even a $100 account very well before they can handle a $1k or bigger account.

The traders were doing nonsense, he argued irrational things, obviously he was fantasizing over his mind "if holding more capital" which I think if he was given the money he would lose the money given to him, I can guarantee people like that.
The correct logic is that if a person can make consistent profits then it can snowball, even $10 money can become $30 at the end of the month if he manages to get an average profit of 10% ($1/day) of his capital every day, even if it is calculated until the end of the year it will definitely be very large and he can have large capital at the beginning of next year.

However trading is about the efficacy of strategies, money management settings, emotional management or self-control, if someone is able to trade very well and consistently profit with small capital, when having big money he will even be much better.

[bitLeap]

So, what do my fellow traders think about this? Don't mind the title if you don't think it's weird; it's just my opinion.

What I personally think is that if a trader lacks discipline or proper risk management in managing a small account, that indisciplined attitude and poor risk management will still affect them even if it is a big account they are trading. I think one should be able to manage even a $100 account very well before they can handle a $1k or bigger account.

Most of my personal opinion is 70% agree about capital being an obstacle when we want to really trade. After some theories about how to trade well and learn how to manage finances in trading cannot be tested if not practiced directly. Al results traders with passive capital put too much expectation of big profits and end up taking risky trading options in order to pursue unrealistic results.

[Cgrexp]

So, what do my fellow traders think about this? Don't mind the title if you don't think it's weird; it's just my opinion.

What I personally think is that if a trader lacks discipline or proper risk management in managing a small account, that indisciplined attitude and poor risk management will still affect them even if it is a big account they are trading. I think one should be able to manage even a $100 account very well before they can handle a $1k or bigger account.

I also know someone who has a mindset of making a big deal out of the difference between small and large capital, using the excuse that it’s their small capital that prevents them from making consistent profits or something like that.

But that doesn’t matter at all. Because if someone is truly disciplined in risk management and also disciplined in managing their emotions while trading, they will definitely be able to generate profitable results in trading.

And someone who uses their small capital as an excuse has likely never experienced the heavier mental pressure that comes with using much larger capital, which sometimes leads us to reduce leverage in the futures market and even become more selective in choosing trading pairs in the spot market.

Whether the capital is small or large does not guarantee the trader profit and does not determine the ability to be profitable. In both cases, the   more important in strategy and risk management. If a trader cannot consistently make profits even with a small amount of capital, then even if the capital is large, he will make the same mistakes and the difference will be only in the amount of loss. If someone increases the capital as an alternative to skill, then it can increase both the amount of profit and loss. But  losing $ 100 and losing $ 10,000 are different feelings. After losing $ 100, a trader can invest $ 100 again, but after losing $ 10,000, a trader usually gets disappointed and it takes time and research to invest $ 10,000 again later. In fact, many do not value small losses, but when a large loss occurs, it shakes the conscience. So if a trader can see positive results with small amounts and maintain consistency, over time he can increase the amount of his capital and this can be a sustainable method.

[Frankolala]

Whether trading with a big capital or not a poor trader will always blow up his capital. Moreover, running at loss is the nature of trading because you're trying to outsmart the price wave of the market which is impossible to do most times. It's better to learn trading with small capital and increase it than just rushing to trade with big capital because the outcome will be the same. If you trade with big capital,  it will only take time before losing it.

[Numan467]

It means you are saying “I would be a great driver if I had a faster car.” It is  not car's fault.    
Yes, self-control does not increase with size of the account, it increases with the person. If someone account is $50 and they lose it due to bad risk management, they will do the same with a $1k account because it is a larger "position" and feelings will be stronger.
Real sign is his own words, he doesn't care if he loses it. It is not a money problem, it is mindset problem. There is no money that can fix that.

[puloweh555]

What I personally think is that if a trader lacks discipline or proper risk management in managing a small account, that indisciplined attitude and poor risk management will still affect them even if it is a big account they are trading. I think one should be able to manage even a $100 account very well before they can handle a $1k or bigger account.

What you explained is very accurate and even makes sense. The main problem in trading isn't the size of your capital, but rather your discipline and mastery of risk management. Basically when someone trades haphazardly and doesn't protect their small capital, they usually do the same when they use larger capital, resulting in much greater losses.

$100 can still be wiped out quickly if risk management is poor, let alone with $1,000. This also applies vice versa because having large capital actually requires you to have tighter control, not looser. In most cases, large capital without discipline and risk management only accelerates your own destruction, but consistent traders are usually able to manage both small and large capital well.

[Royal Cap]

Do you also think capital is your problems and reason why you are not profitable?

I think the main problem here is not capital, but mentality. If someone cannot follow the rules in a small account, then it is difficult to break the same habit even if they get a big account. However these are usually not the main reasons for not being profitable.  If a trading strategy does not have its own edge, risk management is weak or the trader cannot control his emotions, then even a large capital will turn the same mistake into a big loss.

[Slow death]

How many trades are successful? The answer to this question isn't difficult to find because many articles provide that answer. We're talking about less than 10% of people who enter the market and make a profit. This is a very small number, showing the great difficulty most people face in the market. That's why it's not surprising that this trader says that if he had a lot of capital he would be profitable. When you reach that stage, it's because the person is already addicted to trading and can't see that the more money they have, the worse it will be for them, because they will lose it very quickly.

Last year I read about the case of the Ukrainian influencer and I looked up this article because it's something important we always need to remember when trading. He committed suicide in his car, shooting himself. He was a trader. His name is Konstantin Galich. At the time, it was suspected that he committed suicide because of trading. He was 32 years old and, mind you, he taught other people how to trade. Which means he wasn't an amateur. But even so, he faced financial difficulties and committed suicide.

[Josefjix]

This is an argument that sparked among traders arguing why each of them is not yet profitable. While others gave meaningful and agreeable reasons why they are not profitable, one of them insisted that he is not profitable because his capital is so small and he doesn't care if he loses it or not, and that's why he is not profitable. He said that if he is trading a big capital account like $1k, he can consistently make profits without blowing the account. Note that $1k is considered big, because he is trading with very small capital, not even up to $100.

They may both be right or wrong in their own perspective and view, but what I know is that, everything depends on the account management and discipline attached to it. I don't see any reason why a trader with smaller capital will joke with the trading because it's too small, that means, such trader is using real money inform of a demo account-Using real money to practice trading and not aiming for profits.

While a trader who has large capital is more serious with his trading habit, I haven't seen high capital trader who jokes with his money, always on guard and makes sure he protect every losses.

[freedomgo]

Losses do not mind the amount of your capital. If you set unrealistic trading position and trade blindly, you won't expect to make profitable trades later on, but expect real losses because you are incompetent, lack of knowledge and experience, and lack of discipline and poor risk management. Whether you have huge amount of capital or just minimal amount, if you've got no skills and working strategies to thrive in the market, then you'll definitely lose the rest of your trades.

However, having huge amount of capital may prolong trading in the market, but it will never create guarantees that you won't experience losses. Trading is risky, and anyone that is taking uncalculated risk like he is gambling, losses are more certain than winning and making profits.

[Alphakilo]

Not being able to manage small amount during trading activities and without the need or application of risk management practices is nothing more than just gambling.
A trader who thinks $100 is too small to manage won't be able to manage a $1000 capital or big ven know how to properly apply risk management practices and trading strategies to double their profit and retain capital. It's as simple as that.
Trading without discipline or thought of capital management and risk management is absolute gambling, and there's no better definition for that.

[stadus]

Regardless of the amount of capital, if a trader sticks to strict risk management and avoids trading with emotions, and has proven skills and strategies to work in the market, this kind of trader will surely be profitable trading in the market.

But if a trader takes leverage even with poor knowledge and skills, and poor risk management and discipline, this kind of trader will never be profitable in the market but is more expected to trade in failure and losses.

Capital management is still essential in trading, but capital management alone is useless if you are also trading like gambling.