Forget P&L (profit and loss) – it is a common phrase, but many traders have a real understanding for why we act the P & L in the first place, what’s causing this negative behavior and how we can avoid it. The popular and trivial, the hint ”do not look at your P & L” is not enough, because it is not capable of the underlying emotional problems as we will see. To trade P & L is slightly deeper and there are a lot of things we can do. What is the meaning of ”trade P & L”?
4 common mistakes every trader makes
Before we get into the details, let us take a brief look at what the trading with P & L means. First is the P & L for profit and loss (profit and loss) and, therefore, this means that the merchant can view their account balances and / or unrealized gains in their business. To trade the P & L means that traders are making trading decisions, for example, exiterade business, choose positionsstorlek that are not necessarily based on the graph’s context.
I just want to go out for break-even
A common example is when the trader is in a losing position and then adds to the loss or extend the stoppförlustordern while they repeat themselves. ”I just want to go out for break-even”. But at this point in time, the merchant is completely separate from the chart and prisåtgärden and focus just on the money he did not want to lose. Big mistake as we all surely know.
I need to recover my recent loss quickly
Another common pattern is when the merchant has a series of losing trades and trying to push their next trade beyond what he could reasonably have expected. To try to compensate for the losses by playing with your next business and profits is another classic sign of trading with P & L.
I just need a single win to reach my goal
This is something that the majority of traders will be wrong, and I’m sure many will disagree but is my opinion. Performance targets or prestandaanalyser in pre-defined periods must be avoided, and it creates many problems. For example, if you have a monthly returmål and you do not have beaten it, you may be compelled to trade a bad trade just because your P & L may need a little extra push. When a trade fails, and you find yourself farther away from your return goal, it could easily end in a disaster. Trading is a continuous activity, and variance plays a big role. It is a great mistake to set random goals for each week, month or year because you can’t control how many deals you will get.
Oh no, I do not want this rebound going to eat up all my profits.
A trader is in a profitable trade, amounts to 100 dollars, but suddenly, he sees a rebound and his unrealised profit goes down to $ 70, may then fear that his trade ends up in danger. This is a common problem and mikrohantering and inconsistent vinsttagning is a big problem for many traders.
10 tips to stop trading your P & L and be a more emotionally stable trader
A separate survey from the trade
This is my favoritspets and I have seen that it works for many traders. I use tradingview.com for mapping and analysis. When I want to execute a trade do I open my mäklareplattform and goes into trade there. When I close my mäklareplattform again. In this way, I avoid looking at my P & L but also an obstacle for me when I can’t touch myself with my business later.
Hide the P & L column
On many platforms, you can hide the P & L column. This is not the perfect solution but it is a starting point. You should try to eliminate as much information on the P & L from your trading platform as possible.
Have a clear plan before you start
Before you enter a trade, you must know where your stop loss goes, TP is going and what needs to happen in order to trigger an early exit. Write it down in your trading plan. It will reduce the probability of gains when you trade emotionally.
When you constantly trade your P & L and focusing too much on the money, it means usually that your trade size is too big for you personally. If a normal loss on a trade seems very meaningful for you, reduce your size. Anxiety is always a sign that something is wrong.
Analyze your handelshantering
You can do it yourself or choose a professional solution that evaluates decisions on the handelshantering and the impact on your P & L.
Do not look at performance when it comes to periods
I mentioned it before. Not separating your trading in random and arbitrary periods. There is no reason why you need a weekly, and monthly goals. It is just stress. Funds and professional pengarchefer have their performance linked to annual benchmarks, and creates a lot of pressure.
Do not set performance targets
You can’t control how much you can take out of the markets. You can only check the quality of the deals you take and your risk. Profits can not be controlled. To set your goal where you don’t have any control over, does not help …
Focus on the process
Try to become the best trader by implementing a fixed handelsrutin, have rules for your trades and have a goal to make the best deal. The best deals are to be defined in this context by how well you follow your plan and your system.
Do not trade on your mobile
Traders who trade on their phone will stop trading P & L. You can’t really see the chart and make a decent prissatsanalys. You must have your plan ready before you enter the trade.
Build trust and confidence
Lack of confidence in their trading system, create doubt, and then causes a series of emotional problems (FOMO is one of them). Many traders change their trading system regularly and have no understanding of their system. This creates a lot of doubt and uncertainty, and when a trader does not fully understand how to perform and handle their business, he will return to the trading P & L.
To overcome this, make a conscious decision to stick with a system and learn everything about it. No system will work right from the beginning and it is a trader’s job is to seek continuous improvement.
I hope this helps you understand what trading your P & L means, how it manifests itself in trading behavior, and how to overcome it.