My honest advice for traders losing more than they win (Unfiltered)

Summary

The speaker candidly shares their trading journey, emphasizing the importance of patience and discipline in trading. They recount a personal experience where rushing led to significant losses, underscoring the need for a systematic approach and backtesting to build confidence. The video dispels the myth of chasing 'pips' and highlights the significance of risk-reward ratios over win rates, advocating for a data-driven strategy to ensure consistent profitability.

Takeaways

• 📈 Consistency is key: The speaker emphasizes that having a system in place for consistent profitability is crucial, rather than making money every single month.
• 📱 Social proof: The speaker posts daily trades on Instagram as evidence of their trading success and to back up their claims.
• 🚫 Avoiding rush: One of the main reasons for not making money is the rush to trade, which can lead to poor decisions and losses.
• 📉 Learning from failure: The speaker shares a personal story of a significant trading loss to illustrate the importance of learning from mistakes.
• 🛑 Importance of discipline: The speaker warns against breaking trading rules, especially when emotionally driven, as it can lead to substantial losses.
• 🔢 Data-driven trading: Trusting one's trading edge is built on having data to back up the strategy, which instills confidence in trading decisions.
• 📊 Backtesting is essential: The speaker stresses the importance of backtesting a trading strategy over several months to ensure its viability before live trading.
• 🚫 Avoiding pip obsession: The focus should be on risk-reward ratios rather than the number of pips gained or lost in a trade.
• 🤔 Questioning high win rates: The speaker suggests that high win rates promoted by some trading groups may be misleading and not indicative of profitability.
• 📉 Accepting losses: It's normal to have losing trades and weeks; what matters is the overall profitability at the end of the month or year.
• 📝 Keeping records: Maintaining a record of trades, both wins and losses, is crucial for accountability and improvement in trading strategies.

Q & A

What is the main issue the speaker addresses regarding trading?

The main issue addressed is the rush and impatience that traders often experience, which can lead to poor decision-making and losses.

How does the speaker describe their trading system?

The speaker describes their trading system as having a set of consistent rules that, when followed, ensure profitability over time.

What mistake did the speaker make during the prop challenge that led to a significant loss?

The speaker manually closed a trade too early, thinking they had hit their profit target, but after commissions and other deductions, they fell short and ended up blowing the account by breaking their own rules in a rush to recover.

Why does the speaker emphasize the importance of backtesting in trading?

Backtesting provides data that supports the trader's strategy, builds confidence, and helps identify potential pitfalls or patterns in trading behavior that can be improved upon.

What role does the speaker believe emotions play in trading decisions?

The speaker believes that emotions can significantly impact trading decisions, often leading to hasty and unprofitable choices, especially when traders are under pressure or feeling rushed.

What is the speaker's view on the importance of risk-reward ratio in trading?

The speaker emphasizes that the risk-reward ratio is crucial in trading, as it determines the profitability of each trade and should be the primary focus rather than the number of pips gained.

Why does the speaker discourage focusing on win rates in trading?

The speaker discourages focusing on win rates because they can be misleading; a high win rate does not necessarily equate to profitability if the trades are not properly risk-managed.

What is the speaker's advice on the frequency of trades taken by successful traders?

The speaker advises taking fewer trades, as successful traders often trade less, which can lead to higher overall profitability.

How does the speaker suggest traders should approach the learning process in trading?

The speaker suggests that traders should be patient, allow themselves at least a year to fail and learn, and not rush the process.

What is the speaker's recommendation for traders who want to improve their trading skills?

The speaker recommends backtesting extensively, focusing on risk-reward, avoiding bad habits, and following a systematic trading style that has been proven through data.

How does the speaker demonstrate accountability and transparency in their own trading?

The speaker posts their daily trades, including wins and losses, on Instagram, allowing followers to see their track record and hold them accountable.