Pip Mavens Principle #3
Forget the money.
The more you care about the money, the less of it you end up with.
This applies to many areas in life, and especially to trading.
When money becomes the primary focus, it's easy to lose objectivity.
This is how many traders end up breaking their rules, revenge trading, and generally making poor decisions.
Keeping emotions in check
The best way to avoid emotional trading is to make all decisions before entering the market.
Once you have a trade on, no new decisions should be made until the trade is closed. If you have to, walk away from the computer after the trade is placed. This measure is simple, but effective.
Other measures to think/trade more objectively:
- Use a small lot size
- Hide the profit/loss display on the trading platform (with tape if necessary)
- Avoid looking at other traders' performance
And don't just stop there. Come up with your own measures to stop yourself from worrying about the money.
You know you're on the right track when you:
- Feel light and loose when trading
- Care very little about the result of a single trade
- Don't know how much you made on or lost that week
Forget the money
When you stop obsessing over the money, you free yourself form the emotional chains that suppress your rationality.
Paraoxcially, this will help you perform better.
To trade well, let go of your desire for the prize.