I have a good trading system which has been giving good returns. I am trading since last 6 months but i sometimes seems to break the rules and take unnecessary trades which result in losses and takes away my previous gains.
How do i discipline myself to take only trades according to my system and avoid taking unnecessary trades?
Discipline is about seeing the long term & understanding that you’re harming yourself by taking bad trades.
Next five you see a bad trade, just walk away.
Remind yourself of the above.
Count to 10
Trading is a reflection of one’s personality
Known this & work on more discipline in other aspects of life also.
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One option could be to move certain percentage of profits into some other account or invest in long term mutual funds or something like that.?
Restrict number of trades or amount of profit or loss a predetermined level.
If five or more continuous losing days then give break and do paper trading for few days. Here paper trading means buy one number in Equities whose price is below 500.
Also when having a bad day
Just walk away
Don’t try to make up losses immediately
This is what traders at Investment banks do
They have a guy who taps them on the shoulder of they’re having a bad day
Then they really stay away from trading for that day