Many have heard hundreds of times the claim that 90% of operators (especially novices) lose much of their hard-earned money. But why is this? The main reasons are as follows:
Not everyone has the conditions to be a trader as we all do not have the skills to be doctors or lawyers. The reality is that trading requires above all discipline and patience, and does not occupy any special skills, however there are people who do not have these capabilities so the sensible thing is that they do not risk their money that way and look for another way to Invest your money.
90% of traders who have had the patience and discipline that has allowed them to survive in the game and make a profit eventually fail in any of the following:
Monetary and risk management : Many operators fail to establish risk patterns. Many even do not apply appropriate monetary management techniques, which are imperative and should be a fundamental part of any trading strategy.
Diversification: Rather than exposing your entire trading account to a few positions in a specific currency pair, it is best to open small positions in various pairs. What professionals do is choose a few currency pairs, study them and become experts in them.
Overtrading: There is nothing more dangerous than overtrading and is usually due to lack of planning. Many people are surprised by the fact that many of the most successful traders actually operate relatively little. In other words, they choose a few good opportunities and take advantage of them.
Loss of control of the situation: Do not let a position control you, always stay in control of the situation and yourself. It is a mistake to fall into a situation where you are not in complete control of a position and let it get out of hand. When this happens you will probably notice that the situation affects your reasoning and can lead you to make more mistakes.
Take small profits and let the losses run : Many traders end up losing everything by not applying a simple rule: Cut your losses and let your profits run. This makes that your profits never compensate and much less surpass your profits by but that it has a good strategy of trading.
All this may sound very simple but you need self-control and discipline to operate correctly and make steady gains over a long period of time because for many it is difficult to control the emotions and stick strictly to the plan, whether it is winning or losing.