10 Times Traders Lose Money

10 Times Traders Lose Money
10 Times Traders Lose Money
Bernard Goldbach

Profit making in trading is a function of the market matching your methodology. We trade with a philosophy and we profit when it correlates with the current market environment. We make money when our winning percentage is high and our losses are kept small, or when or wins are big and are losses are small. If we have the discipline to follow a system consistently and manage our risk, then the profits will come when the market is conducive to our method. Until then it is our job to keep our losses and drawdowns under control.

  1. Day traders have trouble making money in markets that lack intra-day volatility.
  2. Trend followers can’t make money when markets don’t trend in one direction for any length of time.
  3. Momentum traders lose money when stocks fail to breakout over resistance and trend.
  4. Traders that use chart patterns don’t make money when trend line breaks don’t lead to sustained trends.
  5. Swing traders don’t make money when support levels fail and stop losses are hit before a reversal.
  6. Dip buyers don’t make money when downtrends begin and lows get lower.
  7. Option trades lose money when markets fail to trend before the option expires.
  8. Option sellers lose money when parabolic moves put the sold options in the money.
  9. Investors lose money in bear markets.
  10. Perma-bears lose money in bull markets.