Why Good Forex Traders are really the Biggest Losers you will ever find.

Many new Forex traders think that successful traders have positive deals all the time. Most
successful traders, in fact, trade with success rates between 50% to 75%. Because of this it
also means that they also lose 50% to 25% of the time. If you add up all the losses made by
a successful trader (in dollar terms) the losses are much bigger than the gains or losses
made by an unsuccessful trader. Therefore Good Forex traders are not only the biggest
winners but also the biggest losers (in dollar terms).

There are many reasons for this. Good traders have accepted the fact that losing is part of
Forex trading. They therefore process and accept loses in a very positive way. They are not
distracted by loses or become emotionally upset. They view their losses as learning
experiences and therefore get great value from loses. They also know that a trader’s
success rate is only one of the components to a financially rewarding trading career. They
know that to succeed it take a balance between many trading skills and factors. These
factors include good money management, a positive and objective trading psychology, how
much profit you make on winners, how much you lose on losers.

This positive approach allows them to trade more often (Not talking about over trading) as
they are not distracted by trading psychology problems such as depression and paralysis.
They are also more confident at increasing the number of lots traded based on their past
successes.

Successful traders therefore trade more and use more lots. Not only do they make more (in
dollar terms) on their winning trades but at the same time they lose more on their losing
trades because their numbers of lots are slowly increased.

Unsuccessful traders don’t risk as much on their trading or don’t trade as much due to their
inability to deal with losses positively. This increases their insecurity and gives them a
trading inferiority complex. Most unsuccessful traders are so distracted by their losses that
they start their quest for the Holy Grail over and over again every week.

If you can process your losses positively you can save so much energy and time by
improving what you already have as a trading technique. Almost all trading techniques can
be made to be profitable by adding a few filters anyway (or reversing the trading direction
on unsuccessful systems) so the trading system is the easy part.

Poor traders lose money due to poor (or no) money management and having an
inappropriate trading psychology (which includes how losses are accepted by the trader).

Good traders lose money because it is part of trading (the market will always do what the
market will do) and they don’t lose any sleep about these loses.

The ability to deal with losses positively is one of the biggest differences between successful
traders and those who are not so successful.

How well do you deal with your trading losses?