Loosing money, is it the best way to learn?

[dmt257]

Its about 65% from that stats released by various brokers that I saw posted up here a few days ago.

 

[brettus]

Re: Losing money, is it the best way to learn?

So here is may 2 cents coming from someone not very experienced about learning to trade.

To start you trading have to read up trading and read books to learn about trading. However if you want to be a footballer like David Beckham reading books about football and not actually kicking a ball ain't going to make you a good trader.

So you use a demo account to practise you learn a little bit more and you learn the basics, but there is no real emotion involved in demo money, you also make silly mistakes which might loose you a few quid but again you don't take it seriously cos it ain't real. This is like being an army soldier, he practises and practises on friendly soil using blank rounds and trying to work out what to do in different situations. However this isn't real, he isn't scared he knows he's safe and won't die. It's not real combat zone, the real thing will be different.

You then use a real account which is where I'm at today, this is where the reading and practising comes into play. Those silly mistakes you make when using a demo account come into play, your emotions come into play a lot more and if you are that army soldier this is what might cost you your life. I have found that this is where I have learnt the most, however I have not really learnt much from a trade has gone right but I have learnt a lot lot more from when a trade goes wrong. I carry out a post mortem on the trade to find out what went wrong and most of the time I find it's down to really simple mistakes I have been making. These were simple mistakes I knew about and I had done in a demo but when you loose real money on these mistakes you get your finger a little burnt and become more disciplined.

This is my philosophy on becoming a good trader to really learn how to trade you need to get your fingers burnt a little of amounts you can afford to loose, learn from these mistakes and progress. Therefore as strange as it sounds loosing money is actually a good thing, we learn from making mistakes.

I welcome people to tell me what they think about my views

Yea lose money, hopefully you'll get fed of losing and want to learn, but there's always a chance you get lucky at the start and gamble it up to a meaningful balance then do it all in one day.

I pretty much never demo'd or read a book to start off with. Started with £100. Turned it into £300. Took my £100 out. Then gambled it up to £1k, then lost it all in one day, pretty much. At least 80% of it. That put me off trading for a few months. That might not be a good idea. You need to stick to some sort of plan.

 

[cstrader22]

You can't be afraid to lose, but you don't want to do it much. Years of experience helps you figure out when the trade is worthwhile and likely to work.. I completely agree with others that you have to work at it over a long period of time.

 

[HAL 9000]

Seems like some sort of flawed logic here. With the majority of (fx)traders consistently losing, their rate of learning must be almost exponential. :smart:

If it is the best way to learn then why aren't they getting better at it?

My suggestion for what it's worth is to try and improve your ability to learn rather than your ability to trade. You don't need to keep hurting yourself or your wallet to learn that something's not working.

You don't need to crash a car to learn to drive, you don't need to get burned to understand fire is hot. The idea that behavioural change comes about only through pain seems a bit extreme to me. Not many people would beat a dog to instill discipline.

So you use a demo account to practise you learn a little bit more and you learn the basics, but there is no real emotion involved in demo money, you also make silly mistakes which might loose you a few quid but again you don't take it seriously cos it ain't real.

Why aren't you taking it seriously? Trading is all about performance right? even from the word go. Your not going to see Hamilton going out to qualify thinking "ah f*ck it I'll get it together for the real race"

If you need to lose money to get serious I'd start questioning my motives for trading.

My tuppence worth.