10 – Accept the Fact that you were Wrong
One of the hardest things to do during the first 2 years is to accept that you will be wrong sometimes, and you’ll be wrong more often than you’ll be right. Most successful traders have more losing trades than winning trades. However, winning trades usually come with heavy gains and losing trades with minor losses and thus as a result traders make profits. Some people tell themselves that as long as they don’t sell their stock they haven’t lost anything. If they do have the chance of seeing their stock actually bounce back up, they will usually sell at a point where they will be at par with their losses. Many times the stock will actually continue its increase and you will then start having regrets and tell yourself that you should have kept the stock as you could have end up with a profit. But more often than none you may just find yourself holding on to a losing stock that may never recuperate from its losses.
“Do not try to correct your mistakes. Accept the fact that you did a mistake, that you were wrong, and then move on.”
It is too late now to correct your mistakes; there will be other opportunities in the future that may lead you to better and bigger things. One strong advice is for you to stop feeling bad about your past mistakes and remove the words “should” and “could” from your vocabulary. People who buy stocks and hold on to them as they lose more and more money are doing what we call “Buy and Hope.” You may have heard of the famous investors’ phrase of “Buy and Hold”; but keep in mind that you should only “Buy and Hold” when your stocks are moving up. Think about it, if you buy a stock and it starts moving up and doing exactly what you want, why shouldn’t you “Buy and Hold”? There is no logic in “Buy and Hope” as you’re stock is doing exactly what you don’t want by making you lose money, and that is why you should cut it off the moment you incur a loss of ideally no more than -8.00%.
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