Risk Management Trading Strategy with Robb Reinhold
Replace Your Income with Options
Navigating Trading Decisions and Emotional Management
Long-term trading positions often face the challenge of price pullbacks, which force traders to decide whether to secure profits or risk turning a winner into a loser. Implementing a trailing stop can mitigate this issue, though it may lead to feelings of disappointment when profits diminish unexpectedly. To manage trading decisions and emotional stress, it is recommended to avoid binary trading approaches that categorize outcomes as simply win or lose. Instead, adopting a 'block trading' strategy enables traders to evaluate performance over a series of trades (e.g., 10 or 20) rather than individual positions. This shift reduces psychological pressure by reframing outcomes as part of a broader set, thus promoting a healthier mindset towards trading results.
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