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Why do some people lose money in trading?
There are few reasons why People lose money in trading:
They don’t learn firstSome jump into trading without really knowing how it works. If you don’t understand the basics, it’s easy to make mistakes.They let emotions take overFear and greed can mess with your decisions. You might panic and sell too soon or get greedy and hold on too long.They don’t manage riskNot setting limits on how much you’re willing to lose can lead to big losses. It’s like driving without brakes.They trade too muchTrading too often or without a plan can lead to bad calls and extra costs.They follow the crowdJust copying what others are doing—especially without research—can backfire.They expect quick moneyMany think trading will make them rich fast, but it takes patience, practice, and smart planning.
People lose money because they don't back test before going live. Without a profitable back test (not over-optimized!) there is absolutely no way to know if the live trading will be profitable of not.
Mdraghib posted:There are few reasons why People lose money in trading:
They don’t learn firstSome jump into trading without really knowing how it works. If you don’t understand the basics, it’s easy to make mistakes.They let emotions take overFear and greed can mess with your decisions. You might panic and sell too soon or get greedy and hold on too long.They don’t manage riskNot setting limits on how much you’re willing to lose can lead to big losses. It’s like driving without brakes.They trade too muchTrading too often or without a plan can lead to bad calls and extra costs.They follow the crowdJust copying what others are doing—especially without research—can backfire.They expect quick moneyMany think trading will make them rich fast, but it takes patience, practice, and smart planning.
Because for somebody to profit, others must lose. Currency markets trading is a mostly zero sum game, hence extremely large returns for some traders is a result of a small or medium or large loss of another group of traders.
