Stop loss, the parameter that the majority of the traders ”hate” the most.
Even though such an exit criterion, which is critical and equally important as the take profit, is not preferred, the professional traders have it as their key to success.
Trading without a stop loss is like ”going to the battle without a shield”. Making profitable trades is awesome, but minimizing your losses is the key.
When going to the ‘’battle’’ with just your ‘’sword’ you will be definitely in danger, but by taking your shield you will be protected from the unexpected consequences.
The majority of the traders fail to implement their stop loss right, and therefore, one losing trade could vanish the account balance.
Is it better to have an account to trade with, the next day, or have no funds and stay stagnant?
Stop loss is a must at all times
It is hard to explain the importance that the stop loss has in one’s trading activity. Nobody likes losing, but this is part of life, especially when it comes to investments.
You strategy, therefore, should always have a stop loss in place, and you should never let enthusiasm captivate your mindset, thus, aiming to be conservative in minimizing your losses when they appear.
Why do you think the majority of the traders get anxious and stressed?
Anxiety, stress, and fear are the factors that stop traders from managing their risk wisely, failing to cut loss and let profit run.
Furthermore, it couldn’t be made simpler but to just implement a proper risk management, thus placing your stop loss, and take profit targets, at all times.
As a professional trader, and a long-term investor, who possesses a strategy that looks promising, your should never forget to protect your funds.
Trade, think big, and always aim to minimize your losses without any limitations.