Experienced Traders are Risk-averse, Why?

Respect people who have good experience in trading.
Experienced Traders are more of Risk averse. It’s not because they don’t like/ can’t make huge return. It’s because they have lived the market. They are still surviving and trading because they respect market, they respect risk.

Respect market, anything can happen at anytime.
No matter, how successful we have been, we should always keep in mind the " RISK " factor.

Many Traders like “Karen - the super trader” , "LJM Partners etc has lost their years of Profit in just one day, Cuz they were victim of half knowledge of Greeks. They didn’t respect risk!

Many traders believe they are great. They don’t think market crash can happen and if it happens it won’t affect them. Well, It’s not their mistake. It’s just because " they haven’t experienced market crash"
We always say " Only believe what you have experienced".

Earlier, When my Dad Kollam Anil Agarwal used to tell me to focus on RISK, In my mind, I was like " Why always RISK, RISK, let’s make BIG money!
But slowly understanding it’s importance. Even it was really difficult for me to understand it’s importance.
We can simply tell people, don’t take high risk. Don’t take high risk.
But, for them it’s just a statement. They won’t understand it untill they experience. Even I didn’t understand. It took me more than a year to understand to some extent. It’s not their mistake, neither mine, it’s jus cuz we haven’t experienced.

I have met many of Dad’ friend who are trading big Portfolio/ 10+ year experience. They have one thing in common "Safe return/ Return with very low risk ".

(Have you ever thought, why is that so? Why don’t they take risk, though they have huge portfolio. Even if they lose, it won’t affect them. But stil they don’t want to take high risk.
Beginners or Amateur Traders are always ready to take huge risk. They want lucrative return.
What if they lose? If they lose, then they are gone. Still they want to take high risk.

And yes, I agree Risk Profile varies from person to person. People with good risk appetite can take high risk, but they should also be confident enough to manage the risk. And even if they lose whole captial, it doesn’t matter, then it’s fine, they can continue.)

One should only take the risk, one can afford to take.
One should only take the risk, he/she can manage.
One should only risk small portion of their capital to survive the market for long term.

Focus on Risk, Not on Returns!


This is one of the most important things to be considered to becpme a successful trader in the long run with a bigger capital.
Sometimes even the experienced traders ask about monthly targets thinking about making regular income.

Also when the capital increases, risk management gains more importance